Real estate markets typically evolve in lockstep with a local economy. A perfect example of this dynamic exists right outside your front door as the explosion in the tech and startup space in the Dallas-Fort Worth area has placed a premium on the finite supply of office space available to organizations.
To that point, CBRE, a global leader in real estate services, named Dallas as the sixth top market in rent growth, experiencing a 15.7-percent increase between 2015 and 2017. As anyone at all familiar with the DFW economy already knows, there is absolutely no indication that such growth might be slowing down anytime soon.
Of course, for organizations looking for office space in the DFW area, this can be seen as both a blessing and a curse. While a booming economy is often viewed as a benefit to all, in the same sense that tides raise all boats, the accompanying reduction in available office space as well as the corresponding jump in average rents can certainly put a significant dent in any organization's budget, particularly startups that might be pinching pennies to begin with.
A Look Ahead
Simply extending current trends can give companies a good barometer on what to expect down the road. Although Dallas-Fort Worth has never been synonymous with Silicon Valley, Austin or Seattle, CBRE reports that it does indeed possess the largest tech market in all of Texas, providing talent across all industries and sectors.
This large labor pool is in part due to the diverse job opportunities available in the area. As a means of coping with this upward trending demand, collaborative amenity areas have become a common requirement for tech companies searching for space in order to attract top talent. The recognized startup capital of the state, Austin, has already seen such dynamics in play.
While Austin is considered a growth leader in the tech market, Dallas-Fort Worth is now labeled an emerging market, as referenced in CBRE’s report. No matter the label, however, both are considered stable markets on the tech office market cycle.
In short, the office space growth that has already played out in Austin is now encroaching upon the Dallas-Fort Worth market, making it even more important to take a well-organized, deliberate approach to your search for new office space as supply is now shorter and stakes higher. Your margin for error become slimmer by the day.