DFW’s economic engine continues to be one of the most robust in the U.S. due to its low cost of doing business, economic diversity, and probusiness attitude. In the first quarter of 2023, DFW’s total job base rose by 7.8% and hit a new peak—with office jobs having risen by 16.9% or 179,000 net new office jobs.
However, even with strong office job gains, the market saw a combination of slow leasing volume, high availability, and significant negative absorption.
“Q1 had the lowest activity in years, underscoring that the market is still disrupted as tenants adjust their in-office versus hybrid strategies,” noted Avison Young Senior Insight Analyst, Walter Bialas.
The market saw a slow first quarter for leasing activity at 2.5 msf with trophy assets outperforming market averages with 250,000 sf of positive absorption in Q1.
“As anticipated, we continue to see high-quality spaces maintaining good tenant demand,“ stated Greg Langston, Principal and Managing Director of the firm’s Dallas office. “Many larger tenants seek newer Class A office space. Buildings with on-site and walkable amenities in higher demand submarkets have the biggest draw.”
The DFW market saw vacancy rates increase overall by 6.2 percentage points to 25.8%, the highest level since the late 1980’s real estate recession.
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Walter Bialas, Senior Insight Analyst: +1.214.974.9749
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