{"id":1004708444,"date":"2024-04-04T04:04:12","date_gmt":"2024-04-04T12:04:12","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004708444"},"modified":"2024-07-25T03:51:29","modified_gmt":"2024-07-25T11:51:29","slug":"dallas-office-market-sees-rise-in-development","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/","title":{"rendered":"Dallas Office Market Sees Rise in Development"},"content":{"rendered":"\n

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\"23Springs\"\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
The 23Springs tower expects completion in March 2025.
Image courtesy of Granite Properties<\/em><\/figcaption><\/figure><\/div>\n\n\n

The Dallas office market has seen relatively robust development activity in 2024\u2019s first two months, according to the latest CommercialEdge data. Despite economic headwinds, in January and February construction starts were up compared to the same period last year. In terms of transaction activity, there were a number of significant sales, although the average price per square foot considerably lagged many of its peers.<\/p>\n\n\n\n

The vacancy rate in the Metroplex was above the U.S. rate, but on par with other secondary markets. Additionally, several large leases were signed in the metro over the past few months, while the coworking sector maintained a steady hold.<\/p>\n\n\n\n

Dallas construction starts on the rise<\/h2>\n\n\n\n

As of February, nearly 6.7 million square feet of office space were under construction across 35 properties in the Dallas market, accounting for 2 percent of total stock. The construction rate was above the 1.6 percent national one, as the metro surpassed some secondary markets such as Phoenix (0.6 percent), Houston (0.9 percent) and Atlanta (1.8 percent). Austin (3.9 percent) and Nashville (4.3 percent) registered higher rates.<\/p>\n\n\n

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\"23Springs\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
Upon delivery, 23Springs will total 626,215 square feet of office space.
Image courtesy of Granite Properties<\/em><\/figcaption><\/figure><\/div>\n\n\n

One of the largest properties currently underway is 23Springs, a 626,215-square-foot project in Dallas’ Uptown. Developers Granite Properties and Highwoods Properties broke ground in June 2022, followed by Highlands acquiring a 50 percent stake in the development one month later for $130 million. Recently, Deloitte signed a lease for four full floors<\/a> totaling more than 100,000 square feet at the upcoming high-rise, and expects to move in by the spring of 2026.<\/p>\n\n\n\n

In 2024\u2019s first two months construction commenced on some 616,607 square feet of office space in Dallas, accounting for 0.2 percent of existing stock. This represents an increase from the figures registered during the same period in 2023, when four properties broke ground for a total of 428,500 square feet.<\/p>\n\n\n

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\"Bank\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
Bank of America Tower at Parkside is scheduled for delivery in 2027.
Image courtesy of KDC<\/em><\/figcaption><\/figure><\/div>\n\n\n

The largest property to break ground so far this year is Parkside, a 500,000-square-foot project developed by a joint venture of Pacific Elm Properties and KDC. Bank of America will occupy 248,000 square feet<\/a> at the 30-story high-rise, as the tenant is reducing its footprint in the metro by more than a half. Kohn Pedersen Fox is the architect in charge and completion is scheduled for 2027\u2019s second half.<\/p>\n\n\n\n

Only one property came online in Dallas year-to-date through February, spanning 100,000 square feet. Throughout last year, developers added some 4.2 million square feet to the market across 27 properties, representing 1.3 percent of stock. In terms of volume, the metro greatly surpassed most of its peers such as Houston (2.8 million square feet), Atlanta (2 million square feet), Charlotte (1.7 million square feet) and Phoenix (639,219 square feet).<\/p>\n\n\n\n

Dallas sales prices lower than in peer markets<\/h2>\n\n\n\n

As of February, more than 1.6 million square feet of office space changed hands in 14 deals in the Dallas market for a total investment volume of $46.7 million. Last year, investments totaled $322.8 million in the metro, as more than 10 million square feet traded.<\/p>\n\n\n

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\"Collins\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
Collins Crossing is LEED Silver certified.
Image courtesy of CommercialEdge<\/em><\/figcaption><\/figure><\/div>\n\n\n

As of the end of 2023, the price per square foot clocked in at $117.90. After 2024\u2019s first two months, it averaged $92.70, nearly on par with Houston\u2019s $93.80, but considerably lagging all other peer markets such as Atlanta ($140.20), Charlotte ($142.70), Nashville ($200.90) and Austin ($542.80).<\/p>\n\n\n\n

The largest deal so far this year is the sale of Collins Crossing<\/a>, a 300,887-square-foot office building in Richardson. The joint venture of Goldenrod Cos. and Reserve Capital Partners purchased the asset from Franklin Street Properties, along with an adjacent 3.6-acre parcel. It was 85 percent occupied at the time of the sale and it previously traded in 2003 for $46.6 million.<\/p>\n\n\n\n

Dallas office vacancy above U.S. rate<\/h2>\n\n\n\n

As of February, the vacancy rate in the Dallas office market reached 21.1 percent, up 430 basis points over 12 months, and above the U.S. rate of 17.9 percent. The metro fared better than some of its peers, such as Austin (22.1 percent), Denver (22.1 percent) and Houston (24.4 percent), but not as well as Phoenix (17.9 percent) and Nashville (16.5 percent).<\/p>\n\n\n

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\"The\n\t\t\t\n\t\t\t\t\n\t\t\t<\/svg>\n\t\t<\/button>
The Madison rises 12 stories in the Platinum Corridor South submarket.
Image courtesy of Cushman & Wakefield<\/em><\/figcaption><\/figure><\/div>\n\n\n

One of the largest deals that closed in Dallas this year is law firm Sidley Austin LLP inking an agreement<\/a> with Granite Properties and Highwoods Properties for 118,484 square feet at the aforementioned 23Springs development. The company is expanding its footprint in the metro as it is moving from the 80,000-square-foot space it currently occupies at another building owned by the same partners.<\/p>\n\n\n\n

Waste and sustainability operator CheckSammy has also expanded its commitment<\/a> in Dallas to 45,098 square feet. It signed a deal with landlord Property Advisers Realty for the space at The Madison, a 288,000-square-foot Class A office building within the Platinum Corridor South submarket. The tenant has doubled the space it previously occupied at the location.<\/p>\n\n\n\n

Coworking sector keeps steady<\/h2>\n\n\n\n

As of February, there were nearly 4.9 million square feet of shared office space in the Dallas-Fort Worth market, accounting for 1.7 percent of stock. The share of flexible space was on par with the national average and with many peers, including Houston and Austin, but behind Atlanta (2 percent), Denver (2 percent) and Nashville (2.7 percent).<\/p>\n\n\n\n

Regus has the largest coworking footprint in the Metroplex, comprising nearly 660,000 square feet across 38 properties. Other major players in the Dallas coworking market include WeWork, with some 418,000 square feet in seven locations, and Lucid Private Offices, which operates roughly the same amount of space in 17 locations.<\/p>\n","protected":false},"excerpt":{"rendered":"

The latest data from CommercialEdge on construction starts and other key trends in the Metroplex.<\/p>\n","protected":false},"author":3120,"featured_media":1004704708,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1586,21782,22251,21783,52420,21742,21747,51973],"tags":[51047,50674],"class_list":["post-1004708444","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-dallas","category-development","category-in-focus","category-investment","category-market-updates","category-latest","category-office","category-southwest","tag-marketupdate","tag-commercialedge"],"acf":[],"yoast_head":"\nDallas Office Market Sees Rise in Development - Commercial Property Executive<\/title>\n<meta name=\"description\" content=\"Read how the Dallas office market performed compared to its peers, according to the latest CommercialEdge data.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Dallas Office Market Sees Rise in Development\" \/>\n<meta property=\"og:description\" content=\"Read how the Dallas office market performed compared to its peers, according to the latest CommercialEdge data.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/\" \/>\n<meta property=\"og:site_name\" content=\"Commercial Property Executive\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/CPExecutive\" \/>\n<meta property=\"article:published_time\" content=\"2024-04-04T12:04:12+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-07-25T11:51:29+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/03\/23SPRINGS-e1709547177545.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1065\" \/>\n\t<meta property=\"og:image:height\" content=\"799\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Radu Corfus\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@cpexecutive\" \/>\n<meta name=\"twitter:site\" content=\"@cpexecutive\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/\",\"name\":\"Dallas Office Market Sees Rise in Development - Commercial Property Executive\",\"isPartOf\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/03\/23SPRINGS-e1709547177545.jpg\",\"datePublished\":\"2024-04-04T12:04:12+00:00\",\"dateModified\":\"2024-07-25T11:51:29+00:00\",\"author\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/#\/schema\/person\/a04f9fc8d7ed936167c8786eb77e39c2\"},\"description\":\"Read how the Dallas office market performed compared to its peers, according to the latest CommercialEdge data.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.commercialsearch.com\/news\/dallas-office-market-sees-rise-in-development\/#primaryimage\",\"url\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/03\/23SPRINGS-e1709547177545.jpg\",\"contentUrl\":\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2024\/03\/23SPRINGS-e1709547177545.jpg\",\"width\":1065,\"height\":799,\"caption\":\"23Springs expects completion in March 2025. 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