Q3 Dallas-Fort Worth, TX Industrial Market Report
Market Overview
With deliveries outpacing net absorption, vacancy rates in Dallas-Fort Worth are expanding. Deliveries spiked to their highest level on record, with half that volume coming from buildings 500,000 square feet or bigger. Buildings above 500,000 square feet report availability of almost 16%, which is well above the current metroplex average of 10.7%. Annual market rent growth is cooling from its peak of 12.6% in mid-2022, as it currently sits at 9.2%.
Thanks to impressive demand throughout the Dallas-Fort Worth industrial market, rent growth is 9.2%, still outpacing the U.S. average despite a recent slowdown.
Market Performance
Leasing demand is coming down from its peak in 2021 and is currently consistent with the five-year average of 32.8 million square feet. As more space comes into the market, leasing activity is beginning to normalize, and rent growth is slowing. Deliveries of 63 million square feet over the past year are a new record for completions in the market. However, construction activity is slowing as rising interest rates and elevated construction costs discourage developers from starting new projects. The Dallas-Fort Worth 12-month sales volume stands at $1.1 billion. When it comes to inventory turnover, Dallas-Fort Worth has seen a decrease from 3.3% at the end of 2022 to an average of 0.9% traded in 2023.
Dallas-Fort Worth By the Numbers Last 12 Months
- Vacancy Rate: 7.9%
- Rent Growth: 9.2%
- Deliveries SF: 64.6M
- Sales Volume: $1.1B
