By Ward Richmond
“A mic drop is the gesture of intentionally dropping one’s microphone at the end of a performance or speech to signal triumph.
Figuratively, it is an expression of triumph for a successful event and indicates a boastful attitude toward one’s own.” – WIKIPEDIA
DFW Industrial absolutely crushed it in 2017. As we bust through the 800,000,000 SF inventory mark, industrial real estate owners everywhere are buying Ferraris.
According to our high caliber research team at Colliers International, the DFW industrial market is at an all-time low at 5.9% vacancy. 10% used to be normal when I started in the business 12 years ago.
DFW delivered 28 million SF of new industrial construction in 2017, and we have another 18 million under construction.I might need to change my business plan and become a leasing agent instead of a tenant rep. Just kidding! Or am I?
The critical stat is that we had 24 million SF in net absorption. Honestly, I have lost track of how many consecutive years this has occurred, but I believe we have been building and absorbing +/- 20 million SF of industrial space every year since Amazon signed their first 1 million SF lease in Dallas. They now have 10 million SF thanks to Jeff Bezos taking down another 1.5 million SF in DFW in 2017.
My team continues to evolve our execution techniques and strategy as we work with top logistics companies, retailers, e-tailers and shippers, helping them to improve their supply chain efficiencies as they deal with increased consumer demand, a tightening (not to mention expensive) labor market, and capacity constraints due to massive pressure on the supply chain caused by the e-commerce boom. It’s not about the real estate anymore. It’s about transportation cost, labor availability, and government incentives programs. That’s why DFW is killing it — a strategic location, robust labor pool, and business friendly government. Here’s to keeping on
keeping on in 2018!
To get further inside my supply chain brain,
please check out my website and blog:
AVG Qoated Rate:$3.79 SF
200,000-499,999 SF: 370/67
500,000-749,999 Sf: 94/18
750,000+ SF: 65/9
Q4 2017 was a record quarter for Big-Box net absorption with over 7.1 million square feet. After a slow first three quarters, absorption more than caught up in Q4, posting a record year with 17.9 million square feet. Major Q4 move-ins included Amazon moving into 2.5 million square feet in three properties, UPS moving into 1 million square feet, and TTI occupying its 600k build-to-suit.
Due to strong absorption, vacancy decreased 0.5% from Q3 to 9.9%. South Dallas is still the market with the highest vacancy, but it saw a significant drop to 19.2% after absorbing two million square feet. Infill markets such as DFW Airport and the West I-30 corridor are in demand and posted 2.6% and 3.9% vacancy rates, respectively.
For all of 2017, the market added 22 million square feet in 43 properties, the most in our statistical history. In Q4, 13 properties delivered and were 51% leased on completion. The construction pipeline still holds 33 properties totaling 16 million square feet, of which two-thirds are speculative.
Asking rental rates were flat from Q3 to Q4 at $3.79. Rates are up 1.9% year-over-year showing that supply and demand are reaching a balance.
Ward Richmond has over eleven years of experience specializing in
industrial real estate, and has negotiated over 500 transactions
while working in over 100 cities across the USA, Canada, and Mexico. Several publications have featured Ward for his expertise
in this field including the Wall Street Journal, Dallas Morning News, and Dallas Business Journal. He also serves on Colliers International
Industrial Advisory Board, and is a member of the Logistics & Transportation Solutions Group.
The Richmond team also includes Liam Logan, Cole Hooper, Brad Balke, Zack Rutland, and Rachel Hendrix. They assist with market
analysis, financial analysis, strategic real estate and facilities planning, site selection, and acquisition and disposition services.
Executive Vice President
ON THE ROAD AGAIN
February 20-22, 2018: IWLA — Tampa, FL
March 11-13, 2018: : Summit LA19, Los Angeles, CA
May 2-4, 2018: Colliers L&T Group Conference — San Francisco, CA
May 5-9, 2018: IAMC Spring Forum — Savannah, GA
Client Services Coordinator
The Richmond team is supported by Colliers International Research Team:
Check out this killer new infographic developed by our talented Colliers Chicago & DFW marketing teams, which highlights some of the
Top Distribution Markets in the USA.
CONTACT WARD RICHMOND AT:
Email [email protected]