DFW Industrial Market Vacancy Rolls to 10.6%

Overall direct vacancy is riding at 10.6% in the 345.6 million sf standing in the Dallas-Fort Worth region, where strategic positioning in the US and a highly marketed corporate-friendly climate are the tickets for success. Activity has picked up considerably in the past 60 days, Thomas O. Pearson, senior director, said at this week's press conference to release second-quarter numbers for office, industrial and investment sales. The first few months seemed slow by Texas standards, but many other markets would loved to have had just a fraction of the activity.

Pearson told the media that there are more requests for short-term leases and extensions in the industrial arena. But then that too is a product of the times as tenants wait to see what the economy is going to bring for their businesses before they make a long-term commitment at the closing table.

The region's highest vacancy, 23.5%, is sitting in the Pinnacle/Turnpike submarket, but it's also only one of three areas that posted to the positive at the second-quarter close. The submarket absorbed 561,892 sf in the quarter while stacking up leasing activity of 729,853 sf in the year-to-date column. The Irving/Coppell submarket pushed the thermometer higher than anyplace else, absorbing nearly 1.9 million sf while posting a year-to-date leasing activity of close to 2.1 million sf. The only other positive reading came from Garland/Mesquite, where Q2 absorption hit 696,132 sf and leasing activity was 735,195 in the first six months. The 15,000-acre AllianceTexas is not included in the report, but the Great Southwest/CentrePort area is. Its absorption number is a negative 434,245 sf, but it's a gain of 131,281 sf over last year's midyear deficit. Leasing activity, though, was more than 1.5 million sf so far this year.

New product is rising just four of the 11 submarkets surveyed: Great Southwest/CentrePort, Irving/Coppell, North Dallas and Richard/Plano. Likewise, only four submarkets showed rent increases across all product type: Garland/Mesquite, Valwood, Walnut Hill and Redbird.