SOUTH DALLAS

Vital Stats

Current Events

The overall South Dallas Industrial submarket as surveyed of I-30 west of downtown, I-20, & I-45 is approximately 167 Million SF. In accordance with the area surveyed, CoStar is reporting positive Net Absorption of 2,110,296 SF for South Dallas in Q2 2023. Despite the positive Net Absorption this combined sector of the industrial market is now 12.4% vacant which is 2.1% higher than reported in Q1 2023. According to CoStar research, South Dallas delivered 5.6 Million SF in Q2 of 2023 and still has 12.3 Million SF remaining under construction in the I-30, I-20, & I-45 corridors. Various developers have secured land positions in this submarket for future development. In total there are approximately 18 Million SF of planned development projects that are currently on hold.

Top Lease Transactions

• Reece Morsco leased 326,728 SF from Crow Holdings at 1001 E Wintergreen Road in DeSoto, Texas just south of I-20.

• RE Logistics leased 74,781 SF from TA Realty at 1800 N Polk St in DeSoto, Texas just south of Interstate 20.

• Overhead Door Corporation renewed their lease for 61,560 SF from Dogwood at 2170 French Settlement Rd in Dallas, Texas just north of I-30 in the Eastern Lonestar/Turnpike submarket.

• Exegistics renewed their lease for 59,517 SF from Dogwood at 2130 French Settlement Road in Dallas, Texas just north of I-30 in the Eastern Lonestar/Turnpike submarket.

• Lanter Distribution renewed their lease for 52K SF from IDI at 4721 Mountain Creek Parkway in Dallas, Texas just north of I-20 in the Mountain Creek submarket.

Deals In The Market

• 2130-2180 French Settlement Road – Dogwood (Seller) offering 1.3M SF across DFW

• 2100 Jo Drive – USAA (Seller) offering 489,310 SF leased to Kenco

Large Existing Vacancies

• 1301 & 1501 Southport Parkway (Building 1 & 2) for 2,126,880 SF with XEBEC in Wilmer, Texas

• 3486 Cedardale Road – 1,084,460 SF spec with Trammell Crow Company

• 950 N Interstate Highway 45 – 1,013,833 SF with Majestic Realty

• 4235 Singleton Boulevard – 1,005,200 SF with LOVETT Commercial (shell complete)

• 3636 Mountain Creek Parkway – 802,206 SF spec with Prologis

• 601 Distribution Drive – 610,662 SF spec with Champion Partners

• 3584 Mountain Creek Parkway – 504,500 SF spec with Prologis

• 4601 Langdon Road – 488,780 SF with LINK (2nd generation)

• Crystal Lake Boulevard & Dan Morton – 467,541 SF with Eider Creek Capital (shell complete)

• 2001 N Hampton Road – 421,890 SF spec with HLCI

• 4501 Cleveland Road – 413,480 SF spec with Robinson Weeks Partners

• 2935 Danieldale Road – 393,899 SF with KKR (2nd generation)

• 2200 Danieldale Road – 393K SF with Principal (2nd generation)

For the past 3 years, the South Dallas submarket of I-30, I-20, and I-45 has enjoyed an average single-digit vacancy rate of 7.1%. However, the rapid pace of an abundance of construction projects and deliveries has flooded this submarket with inventory. Deliveries have outpaced tenant demand in the changing macro-economic environment hence washing away the previous single-digit vacancy along Interstate 20 and Interstate 30.

Experts

Current Events

The outlook for South Stemmons remains positive as we head into 3Q 2023. Per Costar reporting, leasing activity showed a positive absorption of 153,602 SF, which is partially due to the YTD delivery of 1M SF of new construction. This number includes larger blocks of space in West Turnpike. South Stemmons ended the quarter with 5.3% vacancy, and continues to be a tight market with increasing demand. Rental rates and price per SF continue to rise as landlords continue to capitalize on the submarket’s infill location. South Stemmons, historically known as a user-owned market, has become primarily institutionally owned, which in turn has improved a lot of the building offerings for tenants with a lot of capital projects underway. For tenants looking in the market, location has continued to outweigh functionality due to the close proximity to Dallas CBD, the Medical District, and immediate access to thriving Dallas suburbs.

Top Lease Transactions

• CanTex Capital leased their 101,939 SF vacancy at 1011 Regal Row to an Undisclosed User.

• Johnson Development leased 167,490 SF at 505 N Wildwood Drive to an Undisclosed user.

• Dakota Hardwoods expanded and extended their lease in 133K SF at 631-641 W Mockingbird with TA Realty.

• Wilson Bauhaus leased 69,256 SF at 2343 Walnut Hill Lane with Crow Holdings.

• Texas Envelope Manufacturing Company renewed their lease of 33K SF at 10647 Shady Trail with TA Realty.

New Developments

• Trinity Industrial Park - A two (2) building development with GTC Real Estate Investments totaling 82,773 SF.

Large Existing Vacancies

• 8611 Ambassador Row – 100K SF

• 17175 Market Center Boulevard – 71,562

• 10733 Spangler Road – 54,550 SF

• 134-170 Pittsburg Street – 61K SF

• 3202 Manor Way – 52,841 SF

• 4919 Woodall – 50,508 SF

North Fort Worth

Vital Stats

Current Events

North Fort Worth continues to perform as a top DFW submarket through the end of June posting yet another quarter of over 2M square feet of positive absorption with an approximate number at 2.5M. This now marks the fourth consecutive quarter of 2M SF or greater in absorption for the submarket. New development projects that started mid to late 2022 are now starting to deliver and through the halfway point of 2023, North Fort Worth has posted a year to date stat of 6.3M SF. This influx of deliveries has negatively affected the vacancy rate for Q2 pushing it up from 6.0% to 8.1% but this should not be a cause for concern given the sustained positive absorption and continued tenant activity coupled with the lack of new projects breaking ground thus far in 2023.

Top Lease Transactions

• Ryder Logistics has signed 234,478 SF lease at Northmark Commerce Center with Crow/Creation.

• Southwire has signed a 1,076,459 SF lease at Alliance Westport with Hillwood.

• LX Pantos USA, Inc. has signed a 405,785 SF lease at Northlake Logistics Center with Ares.

• Southwest ADI signed a 200,546 SF lease at 820 Crossing with Scannell.

• Volvo has signed a 172,620 SF lease and a 180,504 SF lease at Northlake 35 with Clarion.

Deals In The Market

• GSW & North Fort Worth Infill Portfolio is a 673,075 SF Class B six (6) building portfolio.

• DFW Logistics Portfolio is a 1,322,919 Class B nine (9) building portfolio.

New Developments

• Northlake 35 – A 2,571,480 SF six (6) building project with Clarion

• Alliance Center North 4 – A 615,694 SF development with Hillwood

• Elizabeth Creek Gateway C – A 1,510,500 SF development with DHL

• Silver Creek Business Park – A 1,108,938 SF development with Majestic Realty

• Intermodal Logistics Center 6 – A 1,008,416 SF development with Northpoint Development

• 114 Logistics Park – A 1,004,400 SF development with Logistics Property Company

• Basswood 35 – A 628,260 SF five (5) building project with Eastgroup Properties

• Fort West – A 531,601 SF three (3) building project with Creation Equity and JP Morgan

• Westport Parkway Commerce Center – A 400,565 SF development with Molto Properties

• Mercantile I-35 – A 718,705 SF two (2) building project with MCW Capital, LLC

• Blazing Trail – A 657,562 SF four (4) building project with USAA

• 35 Eagle – A 2,125,159 SF five (5) building project with Clarion

• Westport 25 – A 1,076,459 SF development with Hillwood

• Westside 287 – A 476,576 SF two (2) building project with Crow Holdings

• Speedway 3 – A 683,140 SF three (3) building project with Scannell

• Mercantile Logistics Station – A 816K SF two (2) building project with Velocis

Large Existing Vacancies

• Northlake 35 | Building 1 – 1,049,022 SF

• Northlake Logistics Crossing | Building 1 – 985,800 SF

• Sylvania Crossing @ I-35W | Building 2 – 697,140 SF

• Cowtown Crossing | Building 1 – 553,383 SF

• Speedway Logistics Crossing | Building 3 – 384,716 SF

• Cowtown Crossing | Building 3 - 304,665 SF

• Elizabeth Creek Gateway Building D – 286,467 SF

• DFW Point 35 | Building 1 – 267,280 SF

• DFW Point 35 | Building 2 – 218,400 SF

• Northlink | Building C –