Avison Young releases Third Quarter 2022 Market Reports for office and industrial sectors in Dallas-Fort Worth

Dallas, TX – Avison Young has released its Third Quarter 2022 Office and Industrial Market Reports for Dallas-Fort Worth (DFW). Overall, the region has fared far better than most markets in its recovery from the early 2020 economic slowdown. Jobs have expanded consistently and fully rebounded from the initial losses. Total employment hit another new peak at over 4.1 million, up 6.3% from its late 2019 watermark.  

The office market looks to be gradually stabilizing, although uncertainty remains a concern.  DFW has experienced a strong rebound in office jobs over the past three years with 154,000 new office jobs which is also a new peak. This translates into 14.5% growth, much of which was driven by ongoing organic local business expansions and relocations from out of the area. Even with this strong economic engine, we expect it will require several quarters to show meaningful recovery in office vacancy, sublet availability, and return to the office. The move towards quality office space, however, will continue and put pressure on lesser buildings as tenants seek better space prime locations for their workforce.
Greg Langston, Managing Director for Avison Young in Dallas noted, “While people talk about the low cost of doing business and our pro-business environment, the most significant driver for our region’s growth is its economic diversity. Growth is taking place across all the major office sectors – law, finance, banking, consulting, business services, health care, and especially technology – which is a driving force for most companies today and can be easily accommodated due to DFW’s longstanding tech foundation.” 
The fourth largest metro area in the U.S., DFW’s industrial sector has shown great resilience as the region continues to affirm its position as a key national logistics hub. Some of its competitive advantages over many other major markets include its central location between both coasts; proximity to Mexico for cross-border trade; superior interstate, rail, and air access; and comparatively affordable business costs.  
Like the office sector, industrial jobs are up almost 63,000 from its prior late 2019 peak – an increase of 8.5%.  With 138 million square feet of deliveries and 134 million square feet of absorption since 2018, industrial vacancy, currently running at 6.2%, remains tight. These strong demand dynamics have spurred a significant wave of new development as operators position to take advantage of emerging logistics and manufacturing opportunities.
Mike McElwee, Principal within Avison Young's Industrial Services Group said, “While jobs declined in early 2020, the DFW industrial market has been exceedingly strong for the past five years.  Deliveries and absorption are at historic highs and vacancies are at near historic lows, resulting in rapid rent gains across the region with average rent rates for warehouse and distribution space up 38% since the start of 2019. Overall, DFW remains an affordable market compared to many of the other nationally ranked logistics hubs across the U.S.”

For more information:
Download:   2022 Q3 DFW Office Market Report and 2022 Q2 DFW Industrial Market Report