D-FW Warehouse Demand Soars With Pandemic
The pandemic hasn’t cooled the demand for North Texas warehouse space. If anything, COVID-19 has increased the need for distribution of consumer products.
Companies net leased more than 16 million square feet of Dallas-Fort Worth industrial space in the first half of 2020. Tenants moved into almost 6 million square feet of local warehouses in the second quarter alone.
“The Dallas-Fort Worth industrial market proved to be quite resilient over the first half of the year,” said Kurt Griffin, executive managing director at commercial property firm Cushman & Wakefield. “Even as concerns over the pandemic and changing work patterns confronted us all, demand remained strong. We anticipate demand to remain elevated throughout the rest of the year as we are currently tracking multiple requirements for space in a wide variety of size ranges.”
Some of the biggest warehouse leases in the past three months were made by FedEx, Mars Petcare, AmeriPac and Union Supply, according to Cushman & Wakefield. Two new distribution centers were opened with more than 1 million square feet each: Amazon near DFW International Airport and Goodyear in Forney east of Dallas.
So far in 2020, developers have completed about 15 million square feet of new North Texas warehouse space — less than the total net leasing. An additional 23.5 million square feet of industrial space was under construction in D-FW at midyear. Dozens more projects are planned. Most of the current construction is in the AllianceTexas area north of Fort Worth (7.5 million square feet), DFW Airport (4.9 million square feet) and South Fort Worth (3 million square feet).
“D-FW has continued to perform well due to the increase in e-commerce and the heightened demand for industrial product,” Cushman & Wakefield executive managing director Nathan Orbin said. “Tenant leasing is keeping up with new supply, maintaining a below-historical-level vacancy. Year to date, we have had 11 transactions signed over 500,000 square feet,” he said. “With five of those deals signed since the pandemic started, we remain confident in the short-term and long-term prospects of the D-FW Industrial market...”
