Dallas-based Weitzman Group puts overall occupancy at 90.6% for a market inventory of more than 133.2 million sf for an area where one of the favorite pastimes is shopping. The record-setting year is mortared by 102,000 new jobs and some 95,000 new residents. Add that to the 80,000 existing home sales and 33,000 single-family housing starts and you have a region reaping the bounty from of one of the most vibrant retail real estate markets in the US, says Weitzman.
The DFW region seemingly has the balancing act between supply and demand under control, says Weitzman's research team. The bottom line is that the DFW markets aren't likely to get hit in the pocketbook nearly as hard as the rest of the nation in this year's slowdown, they say.
Power centers lead the region's occupancy level, coming in at 94%, up from 93.2% at yearend 1999. Community centers and malls are tied at 91.5% and neighborhood centers are posting an 87.5% occupancy. None of the numbers reflect the scores of "moms and pops" of less than 25,000 sf that dot the region. And, the numbers will continue to creep up again, predicts Weitzman, despite 10 area closings by Montgomery Ward, two JC Penney losses, two National Tire and Battery locations and a handful of Drug Emporium shutdowns. Re-leasing isn't predicted to present major problems, researchers say.
The boom is such that Weitzman has added three new submarkets to its overview, Rowlett, Rockwall and Allen, posting occupancies of 98.4%, 96.8% and 95.9%, respectively. The three markets are in the region's top five, keeping company with Plano at 95.9% and Ft. Worth's CBD at 95.8%. The high numbers from one end of the metroplex to the other come with record absorption--8.3 million sf, about double 1999's yearend accounting. Dallas absorption is riding at more than 5.9 million sf, up a little over 3.9 million sf from 1999. The Ft. Worth area had absorbed a bit over 2.4 million sf, an increase of 220,958 sf.
The opening of the 1.5-million sf Stonebriar Centre at the intersection of Frisco's Texas 121 and Preston Road had the distinction of being the first mall to come on line in four years. It carries a five-star anchor lineup with Sears, Foley's, Macy's, JC Penney and Nordstrom's. Major additions and expansions had occurred or are under way at North East Mall in Hurst, Ridgmar Mall, The Parks at Arlington and NorthPark. Meanwhile, Stonebriar's chief competitor--the Shops at Willow Bend--is on track for an August 2001 opening in west Plano. The high-end lineup will add metroplex stores for Neiman-Marcus, Foley's, Lord & Taylor and Saks. Over in Garland, Simon Property Co. is working hard on Firewheel Town Center, already signing Dillard's, Foley's and a multi-screen AMC for the mix.
The Dallas area had more than 6.3 million sf in new construction in comparison to a little over the 2.1 million sf that had been built in 1999. The Fort Worth area had added more than 2.5 million, up 427,630 sf from the 1999 tally. Leading the pack's popularity are community centers, which account for 50.4% of the new construction. Power centers dominate 28.5% of the new product, with super-regional projects, 20.3% and neighborhood centers, 0.9%.
Through it all, rental rates have remained steady. The largest jump has been in class-A space for the best locations and the emerging markets. DFW's across-the-board rent averages $12.30 per sf, up from $11.48 per sf in the prior year. Dallas outdistances Ft. Worth's $11.04 per sf average by $1.81 per sf. Frisco carries the highest ticket in the market, fetching an average of $28.50 per sf. In comparison, Dallas' CBD brings in $19.73 per sf and Ft. Worth's, $18.33 per sf. New in-line space is commanding an average rate of $16 per sf to $22 per sf, with prices spiking to $27 per sf to $32 per sf at regional malls.
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