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DFW industrial market continuing strong – with demand maintaining a furious pace!

  • ​DFW’s industrial market ended 2017 with vacancy at 7.0 percent.  While that is an uptick from a year ago, it is an improvement from third quarter, when it stood at 7.3 percent.

  • The important point here is that our vacancy remains below our longer-term average of 8 to 9 percent.

  • While we had expected vacancy to drift slowly back to that long-term average over the last quarters, it has not.

  • The reason for this is simple – demand has been continuously driving DFW for the last 5 years. 

  • For example, in the fourth quarter, DFW registered net absorption of 8.3 million square feet – putting it in first place in the US.  In comparison – Chicago was at 7.3 million square feet, the combined LA & Inland Empire area hit 6.6 million, and Atlanta was at 5.5 million.

  • During 2017, DFW absorbed 21 million square feet. This is essentially “balanced” supply and demand. 

  • Although, despite exceptional demand, rent growth looks to have taken a slight breather after rapid increases over the past few years.​​

  • As of year end, 19.5 million square feet was under construction.  While our pipeline remains high, we expect strong demand to continue as multiple tenants are vying for opportunities and often aggressively pursuing deals to position themselves for deliveries, especially in the established submarkets.​

Source: JLL Research

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