DALLAS—What does a wave of construction mean for office tenants? In the short term, it could mean a bump in asking rents as top-tier blocks deliver, but many predict more opportunities for tenants. With office construction topping the 100 million-square-foot mark, values, concession packages, operating expenses and vacancy rates are all headed higher, according to a first quarter report by JLL.
Some other report takeaways: Entering the eighth year of this real estate cycle, Dallas-Fort Worth has shot to the top of the most in-demand office markets in the country. Case in point is Liberty Mutual adding 5,000 jobs and 1.1 million square feet to Far North Dallas, with several more large occupiers following suit.
Asking rents are up 1.6%, but that growth is being countered by higher concessions. Tenant improvement allowances increased by 3.5% during the first quarter and are now exceeding $75 in most gateway market, according to the report.
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Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
