News
Economy Inching Forward
April 9, 2010
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| Unfortunately, the stop-and-go traffic on I-45, from where we snapped this pic, is a metaphor for CRE. Office and industrial demand will remain slow, and a retraction of rent growth is expected during the 1H10, according to a CushWake DFW 1Q10 report. As the economy slowly improves and job growth returns in late 2010, market fundamentals are expected to increase. Pent-up tenant demand escalated in the first three months resulting in a 41.8% increase in leasing activity, reporting 3M SF leased year-to-date. Although the net change in occupied space citywide remained negative at 190k SF, overall absorption was up 76% compared to 1Q09. One major consolidation, HP vacated 250k SF moving from 3000 Waterview to the former EDS HQ in the Legacy/Frisco submarket. |
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| Across the Metroplex, manufacturing and trade, transportation and utilities sectors lost almost 36k jobs over the past 12 months, the survey states. These sectors are directly related to the overall health of the industrial real estate market, says CushWake's managing director of research Cynthia Jeter. First quarter leasing activity totaled 2.6M SF, a 54.7% decline over year ago totals with warehouse/distribution leases accounting for 77.5% of total leasing activity during the period. Industrial absorption totaled approximately 130k SF. The overall industrial vacancy rate hit a high of 12.9%, above equilibrium for markets of the size of DFW. This rise is directly attributable to new construction completions and tenant consolidations, Cynthia says. |
