C&W Industrial Insider Mid-Year Report -Q2 2018

Cushman &Wakefield Dallas

South Dallas

380 The submarket is served by three Interstate freeways (I-20, I-35E and I-45) and is desirable for its proximity to both the Union Pacific Intermodal and FedEx Ground hubs. The majority of speculative development has taken place in The South Dallas submarket has been the most active from a development perspective this cycle, more than doubling its inventory since 2012, resulting from limited land availability in DFW’s infill submarkets. It is home to mostly modern bulk distribution product with approximately 57% of its building stock constructed since 2010.

the I-35E/I-20 corridor and has experienced steady leasing velocity, while most development in the I-45 corridor has come from build-to-suits. The high vacancy rate is a direct result of the record high construction and deliveries over the past few years. Since most of these new projects are big box developments, one or two deals can substantially move the vacancy needle. E-commerce growth will continue to fuel demand for large fulfillment activities in the Metroplex as omni-channel distribution operations seek to locate near population centers and South Dallas is a popular landing spot for many.

FRISCO SOUTH DALLAS HAS POSTED 5.6 MSF OF NET ABSORPTION OVER THE LAST 12-MONTHS 380

75

LITTLE ELM

ALLEN

75

PLANO

121

MURPHY

ADDISON

RICHARDSON

CARROLLTON

OBSERVATIONS & TRENDS

35E

75

30

FARMERS BRANCH

635

• The building stock is comprised of many new bulk projects configured to meet today’s bulk distribution, e-commerce and supply chain demands • South Dallas is expected to deliver 8.1 MSF for 2018, 49% of which is speculative product, which is significantly more balanced than the submarket’s 7.3 MSF of deliveries in 2017, 93% of which were speculative • The submarket’s 4.6 MSF of inventory currently under construction is about evenly split between build-to-suit and speculative product • Long-term, expect South Dallas absorption to outperform most other submarkets because of its available supply • Overall vacancy rate dipped below 20% and will likely continue to fall as a result of available supply on the ground, ready to be absorbed

635

114

12

12

HIGHLAND PARK

35E

30

183

IRVING

75

DALLAS

80

30

D

IE

12

35E

FORNEY

45

12

175

20

BALCH SPRINGS

12

20

20

HUTCHINS

67

35E

175

DUNCANVILLE

SOUTH DALLAS

45

DESOTO

LANCASTER

WILMER

67

35E

76 Q2 2018