Dallas Ranks Fourth for U.S. Commercial Property Investment at 2020 Midpoint
The Dallas-Fort Worth area ranked fourth nationally for total real estate investment at midyear. Property market investment in North Texas totaled about $23 billion for the 12-month period ending in June, according to researchers at CBRE and Real Capital Analytics. That’s down 7.5% from the previous year because of the COVID-19 pandemic. But the year-over-year decline in investment in North Texas was tiny compared to the almost 70% drop nationwide for properties such as offices, apartments, hotels, shopping centers and industrial buildings.
“The hotel sector had the largest percentage decrease year-over year (-91.2%), while industrial had the least at -49.8%,” CBRE’s analysts said in a new report. The nation’s hotel industry is facing “a historic wave of foreclosures,” according to a report by Trepp for the American Hotel and Lodging Association. The report shows that 23.4% of hotel loans were 30 or more days delinquent last month — the highest percentage on record. The delinquency rate in Dallas-Fort Worth was just under 19%. By comparison, the hotel industry delinquency rate was only 1.3% at the end of 2019.
Only New York, Los Angeles and San Francisco had more real estate investment than D-FW for the year ending with June. And out of the top 20 U.S. investment markets included in CBRE’s survey, only five had year-over-year gains: Seattle, Phoenix, Orlando, Portland, Ore., and Raleigh, N.C.
So far in 2020, most of the major commercial property sales were completed or put under contract before the pandemic. North Texas’ biggest property deals of the year include the $400 million sale of the Galleria office towers and the $370 million sale of the Union development north of downtown Dallas. The sale of the 25-story Kincaid at Legacy apartments in Plano, the 22-story St. Paul Place in downtown Dallas and the purchase of three North Dallas office buildings in Preston Center also were among the biggest investment deals in the area so far in 2020...
