As of mid-year, Dallas Fort-Worth’s retail market was maintaining its record-high occupancy rate of 92.7 percent, according to a Weitzman report. The area’s retail has the highest occupancy rate in more than three decades, despite some high-profile closings. The biggest vacancies occurred in shopping malls, but the area’s occupancy rate remains high thanks to the city’s strong economy, according to the report.
Weitzman cited housing, population, and employment growth as contributing factors to the thriving retail market.
In 2016, more than 143,000 new residents moved to the Dallas-Fort Worth area, according to the U.S. Census Bureau. “There’s a lot of people relocating here with a job [and] a lot of people see how many jobs are open here and how low the unemployment rate is, so they’re relocating here for opportunity,” said Ian Pierce, Weitzman’s vice president of communications.
Pierce said the Toyota headquarters relocation and other relocations have been inducements for moving to the area. The Toyota headquarters is housed at Legacy West Urban Village, which also includes Dallas’ largest current retail project.
Pierce said that despite the closing of some retail centers, most malls in the DFW area report a high occupancy of 95 percent or more. The most notable vacancies have occurred in older and functionally obsolete centers, he said, but strong malls will continue to thrive.
In the past year, notable closures have included Macy’s at Collin Creek Mall in Plano and Sears at Valley View Mall in North Dallas.
“The malls that we have in the market that are still strong are going to stay strong,” Pierce said, citing NorthPark Center. “NorthPark is the perfect example of what happens when you have dedicated ownership and management that continue to keep up with trends.”
In addition to strong management, malls are including experimental-type users like fitness centers and beauty services. Similarly, renovations and new projects entering the market are also dedicating a significant amount of space to food, entertainment, and services, all of which drive customer traffic.
According to the report, Dallas-Fort Worth is projected to open approximately 3 million square feet in new projects and 25,000 square feet from expanded projects this year. Pierce said Weitzman expects occupancy to be stable or even slightly up by the end of 2017.
