DALLAS—Dallas' office market has been one of the strongest inthe country due to its diversified economy and strong growth acrossall sectors. This level continued at the start of 2020 as vacancymoved down slightly, from 20.1 to 19.7%, according to the latestoffice report by JLL.

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This activity was driven by solid first quarter absorption ofalmost 1.2 million square feet. For context, Dallas absorbed anaverage of 2.8 million square feet annually during this last cycle,excluding the largest corporate campuses that delivered, says thereport.

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Its most popular suburban submarkets, Far North Dallas, LasColinas and US-75, drove first-quarter absorption, accounting for65% of demand. The downtown area, comprised of the CBD and Uptown,also contributed almost 250,000 square feet to the first quartertotals.

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In the last year, rent growth slowed in Dallas, coming in at2.6% for class-A and -B space. This is not a surprise given theextended period of rapid growth during this cycle.

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"We were encouraged by the overall leasing activity and believethe momentum will continue as Dallas continues to open up," TDBriggs, JLL Dallas agency leasing co-lead/managing director, tellsGlobeSt.com. "We have a very talented team, and we are leveragingnew and creative ways to stay connected with our clients andprospects in the post-COVID environment. Our technology partnershave put us out in front on virtual tours and other creativecollateral material. Our entire inventory is virtual- tour readyand being used daily to provide virtual tours for our clients andprospective tenants."

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Construction remains strong in the market, although at thisjuncture, there are no large corporate campuses under development.However, build-to-suits for JPMorgan Chase (540,000 square feet)and Uber (469,000 square feet) are underway.

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The JLL report says the US economic slowdown due to thecoronavirus will certainly be felt in Dallas. But overall, Dallashas performed well during recessionary periods, tending to falllater and recover faster than most markets.

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Lisa Brown

Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.