News
Industrial Strength
May 5, 2010
| The local industrial market is stabilizing thanks to improvement in DFW retail, high-tech manufacturing, and energy sectors, says Grubb & Ellis honcho Moody Younger. In a recent chat he let us know he expects vacancies to start decreasing in the next few quarters, as no new projects are set to break ground and tenant demand is rising. | |||
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| Moody, pictured at our recent Bisnow State of the Market event, says North Texas is well-positioned to meet future demand with the continued evolution of intermodal facilities such as the Alliance Global Logistics Hub (below) and the Dallas Logistics Hub. Tenants still hold the upper hand in lease negotiations, increased concessions and reduced rental rates, but landlords will likely decrease the amount provided by year-end as employment picks up and increased leasing activity follows. | |||
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| DFW's industrial vacancy rate increased to 12% 1Q, up 20 basis points from year-end 2009. Asking rates increased $0.01 from 4Q09 to $4.14 NNN per SF in 1Q10. The region experienced 212k SF of positive net absorption in 1Q, led by the warehouse/distribution sector, which posted 1.2M SF of positive net absorption. The general industrial and R&D/flex sectors experienced 529k and 484k SF of negative net absorption, respectively, Moody adds. | |||
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| Illustrating Moody's comments, Hillwood leadership tells us that LG Electronics consolidated its cell phone repair business to its facility at AllianceTexas, leasing an additional 66k SF in the Commerce Center 4 building. LG will occupy the entire 165k SF building. LG originally moved to the Alliance Global Logistics Hub in '05, when it leased 99k SF in the Commerce Center at 2153 Eagle Pkwy in the Fort Worth section of AllianceTexas. CBRE's Seth Kelly and Ryan Keiser repped LG. Hillwood had in-house help from Steve Aldrich. | |||
