At more than 25 million square feet, Dallas-Fort Worth has more industrial real estate under construction than any other city or region in the country, according to second quarter research by Transwestern. In order, the regions with the next largest amount of under-construction space are Southern California’s Inland Empire (19 million square feet), Tampa (18 million), Atlanta (14 million), and Houston (12 million).
Locally, that construction is predominantly seen in South Dallas, where vacancy remains higher than average, but developers keep flocking to build more warehouses because of high tenant demand, great highway access, and low barriers to entry.
Nationwide fundamentals for industrial real estate remain positive as absorption reaches nears its 35rd consecutive quarter in the black. DFW’s 767 million square feet of industrial space is 93.8 percent occupied, and absorbed about 6 million square feet in the second quarter to stand at about 21 million square feet of absorption in the last 12 months. Rents, averaging $5.21 a foot triple net, are rising about 1.4 percent annually.
Very few markets have seen negative absorption in the 12 months, but the ones that have include Long Island, East Bay/Oakland, Pittsburg, and Washington, D.C.