Logistics Demand Catapults DFW to Forefront
A wide array of companies have added major distribution facilities to the metroplex during the past year, and many investors are taking notice and responding accordingly in transactions large and small.
DALLAS—With one of the strongest US economies combined with rapid population growth, Dallas/Fort Worth has recorded significant business expansion that is driving demand for industrial space. And demand is motivating a wide array of firms to increase logistics footprints in the region, one of the nation’s key distribution hubs.
As a major distribution hub, what with Texas being the nation’s top exporter, Dallas/Fort Worth has a massive volume of goods flowing through it. To keep up with rising space needs, 29 million square feet was scheduled for delivery this year, more than any other metro, according to a recent industrial report by Marcus & Millichap.
However, even with the addition of more than 100 million square feet to the metroplex since 2013, the vacancy rate has remained on a downward trend, falling below 6% in the second quarter of this year. A variety of firms have fueled absorption, including consumer goods manufacturers such as Kohler and GE Appliances, third-party logistics firms UPS and FedEx, and e-commerce giants such as Amazon and Wayfair. These companies, along with others, have added major distribution facilities to the metroplex during the past year.
And investors are taking notice of this goods movement zeal and have responded accordingly in transactions large and small. A recent example is the sale of 13335 Floyd Circle, a 50,708-square-foot industrial/flex property located in Dallas. Both the buyer and seller were private investors, and the sales price was undisclosed, although the asset sold at list price very quickly after it was listed.
Due to the inventory of quality multi-tenant industrial for sale in Dallas, there were more than 15 offers for the asset. The Floyd Circle property is 100% occupied with a diverse tenant pool in a desirable submarket near Texas Instruments off of Interstates 635 and 75.
Cody Payne, associate director in Marcus & Millichap’s Fort Worth office and Wayne Bares, senior associate in Marcus & Millichap’s Dallas office, had the exclusive listing to market the property on behalf of the seller. The buyer was secured by Payne.
“The industrial market in the North Dallas/Richardson corridor is very popular with investors,” Payne tells GlobeSt.com. “The building, since it was multi-tenant and has small bay industrial spaces, was also very popular to investors. That is why we generated over 15 offers on the building and had it under contract very quickly after we listed it.”