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Dallas/Fort Worth Office Figures Q1 2023

April 13, 2023 5 Minute Read

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Amid an economic uncertainty that continues to impact corporate decision-making, Dallas/Fort Worth appears to be largely unaffected. The metro area added a robust 211,600 jobs over the 12 months ending February 2023, according to preliminary monthly data from the Bureau of Labor Statistics.

 

Sublease availability ticked up by 3.2% from Q4 2022, standing at 9.8 million sq. ft. throughout CBRE Research’s tracked dataset, with nearly 75% of that amount attributed to Class A spaces. 

 

Meanwhile, market-wide net absorption, a metric based on physical occupancy, slowed from the previous quarter as the market reacts to a higher proportion of renewals plus recently vacated sublease space. While total net absorption yielded 68,892 sq. ft., DFW office would have posted about 160,000 sq. ft. in negative absorption if move-in activity at two new deliveries was excluded.

 

The construction pipeline remained flat following two deliveries and one groundbreaking in Q1 2023. CBRE Research is tracking just over 5 million sq. ft. in projects actively underway, with a preleased rate of 21.6%.

 

Leasing activity, a leading indicator of net absorption, continued to decelerate in the first three months of the year, yet large tenant requirements regained some momentum compared to year-end 2022. This metric tracks occupiers who are actively in the market for new space or lease renewals.

 

More broadly speaking, CBRE believes the national economy will face a moderate recession in H1 2023 with Dallas/Fort Worth expected to outperform relative to other metro areas, yet still face headwinds that may impact the office market.