DALLAS-A recent report released by Delta Associates, the research affiliate of Transwestern, offered the following highlights from 2012.
- The Dallas-Fort Worth economy expanded during the latter part of the year, even as the national and global economic climate remained somewhat volatile. Payroll employment in the Metroplex grew by 66,500 jobs and the unemployment rate fell to 6.2% in October 2012 (the latest data available).
In the office sector:
- Net absorption of office space totaled 1.8 million square feet during Q4, with net absorption totaling 3.2 million for the entire year.
- The area’s overall vacancy rate declined to 16.4% at year-end 2012, from 16.9% during Q3, 2012 and 17.3% one year ago. The trend of declining vacancy is expected to continue during the next two years.
- The limited amount of space in the construction pipeline (currently 1.2 million square feet) will continue to benefit the Metroplex’s office market recovery, as space under construction equates to just 0.4% of the market’s standing inventory.
- Asking rents rose approximately 1.9% during 2012 as a result of decreased available space and increased tenant demand.
The report notes the following trends in the industrial sector:
- The sector recorded steady net absorption of 2.2 million square feet in Q4 2012, with total year net absorption topping out at 8.3 million square feet.
- Vacancy edged down to 9.6% at year-end 2012, from 9.7% (Q3 2012) and 10.5% year over year.
- Construction activity rose during Q4, with 4.6 million square feet under in the pipeline, compared to 1.1 million square feet one year ago.
- Landlords pushed rents higher in 2012. The warehouse/distribution segment, the region’s largest, experienced rent growth of 4.4% with increases likely to continue in the near-term as demand remains strong and vacancy continues to decline.