Dallas-Fort Worth, TX – Today Avison Young released its First Quarter 2024 Office Market Report for Dallas-Fort Worth (DFW).

As of early 2024, DFW’s total job base hit another new peak, rising by more than 350,000 jobs from our prior pre-pandemic peak, or 9%.  Although this includes a sizable revision by the Bureau of Labor Statistics (BLS), DFW remains one of the most robust markets in the U.S.  In comparison, office jobs increased by 15% or 163,000 net new jobs over the period.

The BLS jobs revision also shifted year-on-year job gains considerably.  In the last 12 months, DFW reportedly lost 7,700 office jobs – although it has seen total growth over the last few years 30% higher than the region’s longer-term average.  Even with these above average office job gains, the market saw availability for both direct and sublet space remain elevated near record levels due to the continued acceptance of remote and hybrid work.  Absorption came in slightly positive the last few quarters, which suggests the market may have seen the worst and an upswing is beginning.

“Deals are being done, although 2023 and Q1 2024 leasing activity continued to be sluggish and not sufficient to take down the increase in office space availability,” noted Avison Young Senior Insight Analyst, Walter Bialas.

The market saw leasing activity total 2.6 million sf in Q1. On a square foot basis, this is 40% lower than the longer-term quarterly average.  In terms of absorption, sublet space pulled down the otherwise positive drive by direct space, with Class A and B performing similarly.

“While 2024 did not usher in any great improvements, key metrics like vacancy, availability and absorption were all stable to slightly better. This suggests that we may have finally reached bottom in this cycle,” stated Greg Langston, Principal and Managing Director of the firm’s Dallas office.  “Demand also remained strong for top quality buildings in walkable locations, with good leasing activity among small- to mid-size tenants, under 10,000 sf, who have taken the initiative to return to the office before many of the larger companies.”

The DFW market saw vacancy no longer ratchet higher, staying stable for the last few quarters at 25.6%, the highest level since the late 1980’s real estate recession.