Friday, March 01, 2013

Dallas businesses paying more this year to rent office and industrial space

If you need to rent office or industrial space in North Texas, you should have done it yesterday.
Better yet would have been to have signed that lease a year ago, when the effects of the recession were still being felt.
Now that the local economy is gaining strength and businesses are expanding again, commercial building rents are headed up.
“This market has been a tenants’ market for so long it’s going to be a shock,” said Joel Pustmueller, a partner with Peloton Commercial Real Estate. “In Uptown, in Preston Center and in Legacy in Plano, office rents are up by anywhere from $3 to $8 a foot.
“You are going to see more rent inflation in Uptown than any market over the next 12 months.”
That’s because there is so little office space left to rent in Uptown and up at the north end of the Dallas North Tollway in Plano and Frisco.
Unlike in previous recessions, the Dallas-Fort Worth real estate market didn’t go into the downturn with a big glut of empty commercial buildings.
And as the economy has perked up, businesses that held back on expansion during the slowdown are now scouting the market for new digs. They are finding there is a lot less to choose from in some areas of the city.
“The good space is leasing first,” said Jeff Ellerman of CBRE Group. “The other blocks of space have been picked over.
“There is a lot of space that’s empty for a reason — it’s got problems.”

Steve Brown
Published: 21 February 2013 07:40 PM