Occupancy Rates Give Developers Confidence

The area has a steady stream of expansions and relocations.

DALLAS—The DFW office market is showing no signs of slowdown from its growth mode, as large expansion and relocation announcements become more common. Verizon Corp. and KDC are planning a mixed-use development that would include three million square feet of office space at Las Colinas, JP Morgan Chase plans to begin construction on 1.4 million square feet at Legacy West, Charles Schwab is awaiting ground-breaking on its 1.2 million-square-foot campus at Circle T Ranch, and build-to-suits are in planning stages for Fannie Mae (330,000 square feet at Granite Park) and Interceramic USA (330,000 square feet at Austin Ranch), among others.

The DFW office market ended the quarter with a net 717,419 square  feet of direct absorption, bringing its trailing 12-month total to nearly 4.5 million square feet of space, according to a report by PMRG. Corporate expansions within the market were the driving force behind the demand witnessed during the quarter. Occupancy rates in DFW have been approaching the highest levels since 2002, which has given developers confidence in breaking ground on new product, while encouraging tenants to secure long-term leases as large space options dwindle.