Wednesday, February 18, 2015
2014 in Review: The Dallas Industrial Market
By: Greg Langston (Dallas)
This is the second post in our “2014 in Review” series. If you’d like to read the previous entry documenting the Dallas office real estate market, check back in the Avison Young blog archive.
Although we recently posted predictions for the future of the Dallas industrial real estate market, it’s equally important to look back and measure the year we just experienced. With strong leasing numbers, increased construction, and low vacancy rates, the Dallas industrial market had a decidedly strong year--one on par with the broad success of the Dallas commercial real estate market as a whole.
The most notable statistic for the Dallas industrial real estate market come in terms of construction. According to The Dallas Morning News, roughly 15.3 million sq-ft of industrial space were under construction during 2014--nearly double the amount under construction in 2013. What’s more, this impressive figure is the highest that the D-FW market has seen in over a decade.
These impressive construction numbers are balanced out by equally impressive vacancy rates. Vacancy rates remained relatively stable in 2014 at 5.8 percent--a solid number given the marked uptick in industrial construction over the course of the year. Similarly, according to the National Real Estate Investor, demand in the D-FW market is way up, which certainly bodes well for construction projects set to be completed over the next several years.
As touched on in a previous blog post, there is a bit of debate over how the market will fare over the coming years. On the surface, things remain positive: construction is on schedule, D-FW has a strong labor market, and businesses are increasingly interested in leasing industrial space. Regardless, demand is expected to remain steady or even fall slightly over 2015, which might place a damper on future construction opportunities as current projects come online.
Regardless, the industrial real estate market--as well as the Dallas real estate market as a whole--experienced a stellar 2014. With increased demand, low vacancy numbers, and a veritable boom in construction, the D-FW industrial market is widely considered one of the strongest in the country.
Posted by Greg Langston, AY Dallas at 4:31 PM