Tenants In Charge Through 2010, Say Experts
Some North Texas real estate experts project that office and industrial tenants who have clearly come out on top during the recession will continue to have their moment in the sun throughout 2010. The lone star state experts were part of a panel at a recent event hosted by Jones Lang LaSalle, a financial firm specializing in real estate, to discuss the effect of the economic downturn on the Dallas-Fort Worth area.
Effective office rental rates are down 12 percent in the past year and industrial lease rates have dropped 25 percent, says JLL’s managing director of office leasing, Jim Yoder. Yoder expects office vacancy rates across Dallas-Fort Worth, now at about 17 percent, to peak in mid 2010.
Steve Thelen, managing director of tenant representation at JLL, says that more office tenants are renewing their leases instead of relocating their offices, and concessions by landlords have increased. It will be at least three years before new office development begins again, he said.
North Texas has been grazed by the current national recession, but hasn't felt its full force, and will bounce back more quickly than other areas, predicts Paul Whitman, president of JLL’s Dallas office.