C&W Industrial Insider Year-End Report_Q4-2018

Cushman &Wakefield Dallas/Fort Worth

South Dallas

380 The majority of speculative development has taken place in the I-35E/I-20 corridor and has experienced steady leasing velocity, The South Dallas submarket has been the most active from a development perspective this cycle, more than doubling its inventory since 2012. It is home to mostly modern bulk distribution product with approximately 61% of its building stock constructed since 2010. 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.

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 several years. In 2018, the South Dallas submarket topped its record high in deliveries with 8.8 MSF and surpassed its 2015 record absorption with 6.4 MSF. Despite new supply of over 16 MSF delivered over the last two years, construction starts in South Dallas have slowed during 2018, closing the year with only 1.3 MSF under construction compared to the 7.4 MSF under construction at the close of both 2016 and 2017.

FRISCO CONSTRUCTION AS THE YEAR CLOSES 380 SOUTH DALLAS POSTED A RECORD ABSORPTION OF 6.4 MSF FOR 2018 WHILE CONTRUCTION ACTIVITY SLOWED CONSIDERABLY, WITH JUST 1.3 MSF UNDER

75

LITTLE ELM

ALLEN

75

PLANO

OBSERVATIONS & TRENDS

121

MURPHY

ADDISON

30 • The submarket delivered 4.3 MSF of speculative product in 2018, which is about 49% of the 8.8 MSF of total deliveries for the year in South Dallas • Long-term, expect South Dallas absorption to outperform most other submarkets because of its available supply on the ground, ready to be absorbed • Liberty Property Trust purchased I-20 Commerce Center, a speculative 900K SF cross dock developed by Copeland Commercial • Logistics Property Company purchased Southport Logistics Park, a 1.5 MSF, two-building speculative project developed by Port Logistics Realty • Oakmont acquired a 42 acre site at the SEC of N Longhorn Dr & West Dr in Lancaster – a 603K SF building is planned for the site

RICHARDSON

CARROLLTON

35E

75

FARMERS BRANCH

635

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 Q4 2018