Dallas-Fort Worth office market report

Q2 2024

DFW’s total job base continues to outperform the US and hit new peaks, rising by more than 400,000 jobs from our pre-pandemic peak, or almost 11%. DFW remains as one of the most robust markets in the US. In comparison, office jobs increased by 16% or 173,000 net new jobs over the period.

In the last 12 months, DFW office job growth has flattened, reportedly losing 1,500 jobs – although has seen total growth over the last few years 30% higher than the region’s longer-term average.

Even with this strong office job growth, the market saw availability for both direct and sublet space remain elevated due to the continued disruption of remote and hybrid work. As of the second quarter, net office absorption tuned negative due to some first quarter revisions and a slow second quarter. Importantly, this slowdown was driven by negative demand in the sublet market, with direct space holding modestly positive.

-456k sf

Demand struggling to hold positive

Last quarter, raw office space demand – net office absorption – looked to have stabilized and finally turned positive. Unfortunately, Q2 saw some Q1 re-benchmarking and significant negative absorption in the sublet sector. This pushed market net absorption negative again.

29.4%

Availability has topped out, but no improvement

While we noted last quarter that office space availability looked to have topped out, Q2 saw availability remain unchanged and at an elevated 29.4%. Even though this is close to DFW’s all-time high, it is important that it has moved slightly lower in the last few quarters.

5.7 msf

Ongoing anemic leasing complicates DFW's recovery

Leasing remains sluggish. As of mid-year, DFW saw 5.7 msf of leasing activity. This is 65% of DFW’s normal average pace.

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Get in-depth office market reports and insights from commercial real estate experts in the Greater Dallas-Fort Worth (DFW) area. Avison Young advisors look at DFW commercial real estate activities and the latest DFW statistics to provide you expert market research on the area’s office properties.

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