By Ward Richmond
Dallas-Ft. Worth continues a record breaking industrial real estate warpath in 2021. At Mid-year, DFW industrial absorption has already surpassed 22 Million SF of net absorption. To put this in perspective, this is only the second time that we have surpassed 22 Mil in a total calendar year – but we are only halfway through the year.
DFW was one of the most active markets in the world in Q2 2021 with over 35 Mil SF of new space under construction. Wow! Our overall market size has now passed 928 Million Square Feet so I’ve just started preemptively stating that we are “about a Billion” whenever someone asks.
The most active submarket YTD include: DFW Airport, South Dallas, Great Southwest, Alliance Airport with the North US 75 Corridor close behind (in that order). Fertile dirt for new industrial development include the Denton and East Dallas submarkets where we will see some massive new buildings coming online soon.
This tremendous amount of activity is due to the ongoing demand by occupiers of Supply Chain Real Estate to relocate or expand their presence in DFW due to the amazing logistics infrastructure, low cost of living, central location, strong labor pool, fast growing population and business friendly government.
The Delta Variant is here and masks are back but as an industrial real estate pro, I now recognize that masks and pandemic related fear leads to more home shopping via eCommerce which will only continue to skyrocket demand for industrial real estate. This is because eComm giants like Amazon, WalMart, Home Depot, etc etc need to operate facilities large enough to store every imaginable product (or SKUs as we call them in the biz) in order to get consumer goods to customers as fast as humanly (or robotically) possible.
If DFW numbers continue at this level, we should easily surpass 30 Mil SF of absorption for the first time in history and there is no doubt that 2021 will go down in the Industrial Real Estate Hall of Fame.
It is important to note that all of this industrial activity takes an environmental toll and is undoubtedly continuing to accelerate the green initiatives in the world of industrial real estate. Tenants are recognizing that they need to do their part to take care of our environment and innovations in the world of green building initiatives are coming to fruition as features such as solar powered roofs, EV charging stations, zeroscape landscaping will soon become building standard. Please reach out if you would like to better understand these green building initiatives and how they will continue to transform what industrial real estate development of the future looks like.
You know where to find me.
We hope you all stay safe out there and please reach out direct if we can help you with your Supply Chain Real Estate needs.
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The Big-Box sector continues to lead all product type in the metroplex accounting for nearby all the absorption.
DFW’s quarterly absorption set a new high bar with a record 11.9 million SF. The total through the first two quarters of 2021 has surpassed 2020’s entire year.
16th quarter in a row for construction levels to surpass 25 million square feet.
Rental rates continue to rise up as well in all product type with overall asking lease rate at $5.90 per square foot NNN.
Ward Richmond has over fifteen 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.
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The Supply Chain Syndicate is supported by Colliers International Research Team