DFW Office Leasing Slows Down in Q2

Office leasing activity slowed down in the second quarter of 2022 across Dallas-Fort Worth, according to CommercialEdge. The market saw average vacancy reach 17.9 percent as of June, some 60 basis points higher than it was at the end of the first quarter. The rate was also up 30 basis points year-over-year.

Among similar secondary markets, The Metroplex ended the second quarter in a middle-ground position, surpassing Atlanta (20.3 percent vacancy rate in June) but trailing Austin (16.1 percent). The national rate clocked in at 15.2 percent, up 20 basis points year-over-year.

In terms of listing rates, the metro’s asking prices witnessed constant growth: The full-service equivalent rate was at $28.78 per square foot in April, then rose to $29.17 in May and $29.26 in June, still well behind the national average of $37.58. However, June’s rate was 4.8 percent smaller on a year-over-year basis.

A flurry of Uptown Dallas office leases

When taking a closer look at the metro’s submarkets with inventories larger than 10 million square feet, Dallas’ Uptown/Oak Lawn stood out with a vacancy rate of only 13.7 percent as of June, second after Fort Worth Central Business District (10.8 percent). The submarket has seen a flurry of office leases in the last three months.

23Springs. Image courtesy of Granite Properties

In one of the quarter’s largest deals, Bank OZK signed a 110,029-square-foot lease for its new regional headquarters at 23Springs, Granite Properties’ 626,215-square-foot office tower underway in Uptown Dallas. The Little Rock, Ark.-based lender will occupy four floors at the 26-story development taking shape on 2.5 acres at 2323 Cedar Springs Road. Upon its March 2025 delivery, 23Springs will be Uptown’s tallest office building.

The Crescent, a 1.3 million-square-foot office building at 100 Crescent Court, was brimming with leasing activity in May. Crescent Real Estate secured four lease renewals and four new tenants at the Class A+ property; the eight deals totaled 81,860 square feet. Tenants included UBS Financial Services, JPMorgan Chase and Paragon Associates.

CommercialEdge covers 8M+ property records in the United States. View the latest CommercialEdge national monthly office report here.