Record Demand for North Texas Warehouse Space Continues in Second Year of COVID
So far in 2021, expanding and relocating warehouse and distribution space tenants have net leased almost 29.5 million square feet of buildings.
That’s the most demand for industrial space ever in Dallas-Fort Worth , according to the latest data from commercial property firm CBRE Group .
The need for North Texas distribution space has ballooned since the start of the COVID-19 pandemic, which generated new demand for home deliveries and greater consumer goods inventories.
Continued migration of retail sales from the storefront to the Internet has also driven a spike in warehousing.
Another factor is the record population growth in the D-FW area, which adds to demand for storage and shipping facilities.
“The trailing 12-month absorption total was 37.8 million square feet,” CBRE analysts said in the just-released third-quarter report. “This insatiable demand among occupiers during current shifts in global supply chains has driven the marketwide vacancy rate to record lows while rents have reached new levels.”
Less than 5% of D-FW warehouse space was empty at the end of September, according to CBRE.
Most of the industrial building leasing activity in the most recent quarter was in areas that have seen widespread construction, including Southern Dallas County (1,872,791), North Fort Worth (1,799,543 square feet) and Northeast Dallas (1,129,366 square feet).
A record 31.5 million square feet of warehouse and distribution space was being built in North Texas during the quarter. And about 32% of that new space is already leased.
Developers have started millions of square feet of new industrial projects so far this year.
Most of the construction is in Southern Dallas County , where more than 13 million square feet of warehouse space is on the way.
Almost 4 million square feet is being built in South Fort Worth .
“Third-party logistics companies, consumer goods, e-commerce and more recently manufacturing continue to drive the bulk of industrial occupier demand,” according to CBRE. “The proximity of D-FW to manufacturing in Texas , along the U.S. Mexico border and into the Bajio region (of Mexico ) bodes well for future demand.”
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