Dallas Office Report – Winter 2019
- Mar 12, 2019
Dallas’ economy continues to thrive, bolstered by solid employment and population gains. The office sector added more than 32,000 jobs year-over-year through October, as a number of major employers have expanded or relocated their operations to the metro’s business-friendly environment. For example, insurance company Liberty Mutual opened the doors of its new, 1 million-square-foot Legacy West regional campus in mid-2018. Meanwhile, San Francisco-based grocery distributor Core-Mark is one of several firms that announced plans to relocate to the area in 2019.
Despite new employers coming to the metro, the office vacancy rate stood at 20 percent as of December. Many corporate tenants currently in the Central Business District—where office inventory is dominated by outdated assets—are opting to relocate into modern, highly amenitized space in the suburbs. More than 4 million square feet was underway as of December, with 90 percent of the pipeline slated for delivery in 2019. The largest project under construction was Pioneer Natural Resources’ 1.1 million-square-foot new headquarters in Las Colinas.
Sales volume topped $2 billion in the 12 months ending in December. More than half of the assets sold during that period were Class B properties, with many buyers planning to reposition them in order to attract new tenants.