Thursday, April 19, 2012
DFW OFFICE MARKET: RECOVERY CONTINUES . . . SLOWLY
DALLAS (PM Realty Group) – The Dallas-Fort Worth office market’s recovery continued in first quarter 2012, but at a slower pace than during the second half of 2011, according to PM Realty Group (PMRG) in its latest market report.
The office market posted a "respectable" 451,464 sf of positive direct net absorption during the first quarter, which comes on the heels of the highest annual gains in four years with over 2.7 million sf absorbed in 2011.
During the first quarter, the Class-B leasing market gained momentum, posting its fifth consecutive quarter of leasing gains with 447,421 sf absorbed, causing occupancy rates to improve by 170 basis points to 79.3 percent within the past year.
The Class-A market recorded 56,417 sf of negative direct absorption during the quarter, largely attributed to vacancies by Verizon Communications (126,750 sf), Highland Capital Management (108,103 sf), Nokia (96,165 sf) and Computer Associates (73,314 sf). As a result, Class-A occupancy rates remained flat at 80.3 percent during the quarter but have improved by 50 basis points within the past 12 months.
Despite the sense of uncertainty for businesses on a national level, PMRG said local tenants are more bullish on making longer-term decisions as they explore the office market, weighing the possibilities of relocation or renewal in order to capitalize on favorable lease terms.
This year, reports PMRG, the local office leasing market is positioned to benefit from several corporate relocations, including Christus Health, Alcon Laboratories and Copart.