Initially, it appeared that the health of office rentals would be failing in 2007. Major companies such as CompUSA and Centex homes suffered huge employee cutbacks, causing them to abandon a significant amount of Dallas office space.
Fortunately, the new trend in metropolitan development of combined use properties has made Dallas office space prime real estate for major companies. The environment fosters ease of living, working, and enjoying entertainment in one easy to reach area, creating a desirable location for employees to live. This has led to a significant increase in employee retention.
New real estate projects were completed in 2007, mostly in the form of luxury office buildings in the Uptown and Turtle Creek neighborhoods.
Due to the introduction of many new office buildings into the market in 2007, and the closing or relocating of several large companies, occupancy still held above 80 percent. Several large corporations have relocated their corporate headquarters to Dallas, including JPMorgan Chase, Bank of America, and Federal Deposit Insurance Corporation (FDIC). Comerica Bank has announced its intention to vacate their corporate offices in Detroit and relocate to downtown Dallas, and American International Group will be moving between 400 and 500 employees into 125,000 square feet of Dallas office space in the Plaza of the Americas Building. AIG’s move will take place sometime next year.
Despite the fact that rents are higher now than in the past, the high quality of life in Dallas makes it an excellent choice for businesses. Technology, finance, and business services grew last year, which helped offset losses in the housing market, keeping Dallas real estate performing well.
As downtown Dallas continues to renovate and grow, it will continue to attract new business to the area. With those new businesses come new employees, which will give the entire downtown economy a significant boost.
Great article, may Dallas only continue to prosper.