"Dallas is a victim of the outside. The fundamentals of this market remain more balanced than any other market in the country," says John Alvarado, Jones Lang LaSalle's managing director in Dallas. "We're at a standstill because we're in a moment of transition."

Zaya Younan, chairman and CEO of Los Angeles-based Younan Properties Inc., faults the Feds for not stepping in quicker to bail out the system so markets like Dallas, where fundamentals are still good, could keep moving. "They reacted very slowly to come up with policies to reverse the trends," Younan contends, "and to this day, they are reacting slower than they should be. That's why the confidence factor is lower."

Both pros have vested interest in Dallas: Alvarado as an investment sales broker and Younan as the owner of the largest class A office portfolio in the city.

Younan

Brokers are starting to whisper that more owners are offering free rent and higher tenant-improvement allowances to win or retain tenants, but they aren't finding cuts in face rents as yet. Greg Leisch, president and CEO of Washington, DC-based Delta Associates, expects rents to hold their present levels as long as Dallas/Fort Worth stays in its vacancy equilibrium zone of 17% to 19%. In 2009, he predicts rents will continue to hold the line and dip in 2010 by 1% in Dallas and 0.50% in Fort Worth.