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Key Takeaways
Dallas-Fort Worth remains a top three US office market by development pipeline, with 2.6M SF under construction as of May 2026.
Office investment hit nearly $1.4B YTD, outpacing most peers, while vacancy rates recovered by 320 basis points over 12 months.
Despite progress, average asking rents and vacancy rates still trail national benchmarks, highlighting persisting headwinds.
Development Pipeline Defies National Pullback
The Commercial Property Executive reports that while many US office markets have slowed construction due to shifting demand and tighter financial conditions, Dallas-Fort Worth (DFW) continues to buck the trend. According to Yardi Matrix, as of May 2026, DFW’s active office development pipeline reached 2.6M SF, ranking third in the nation after Boston and Manhattan. The out-of-stock share—currently 0.9% of total inventory—remains more than double the national average of 0.4%. Although national sentiment on new office development remains cautious, the Metroplex benefits from strong in-migration and its business-friendly climate, fueling sustained activity even as gateway markets pull back.
The Details
Much of DFW’s office momentum comes from several large projects, led by the 800,000-SF Goldman Sachs campus in NorthEnd, a joint effort by Hunt Realty Investments and Hillwood Urban, backed by a $513.9M construction loan from JPMorgan Chase and scheduled for completion in 2028. The broader NorthEnd district is set to eventually reach 4M SF at full build-out. The region’s office expansion mirrors strength in other commercial sectors, with industrial developers also maintaining one of the country’s largest construction pipelines despite slower national activity. In the first five months of 2026, five projects totaling 263,390 SF broke ground in DFW, up 198% from the same window in 2025. However, only one new building—SunBelt Rentals’ 41,790-SF addition in Grapevine—delivered this year, an 86.1% decline in completions compared to 2025. Planned projects could push DFW’s pipeline to 2.8% of total market inventory, positioning the region sixth nationally for pipeline as a share of stock.
Sales Volumes Impress, but Vacancy and Rents Lag
DFW recorded nearly $1.4B in office sales through May, ranking fourth nationally. Major deals included the $200M-plus acquisition of The Towers at Williams Square in Irving by Vanderbilt Office Properties, Hillwood Urban, and TriPost Capital Partners. Estein USA also purchased Pinnacle Tower in Dallas for $142.9M.
Office assets traded at an average of $215 PSF. That slightly exceeded the national average of $213 PSF but remained far below Nashville’s $440 PSF average. Strong transaction activity reflects continued investor confidence in the market.
However, DFW continues to battle elevated vacancy. The market posted a 20.4% vacancy rate, compared with the national average of 17.6%. Still, DFW recorded the country’s fourth-largest vacancy decline over the last 12 months. Average asking rents reached $31.69 PSF, trailing several peer markets and the national average of $33.61 PSF.
Why It Matters
DFW continues to separate itself from weaker national office trends. The Metroplex supports one of the country’s largest office development pipelines despite challenging market conditions. Business relocations and corporate expansions continue driving activity across the region.
According to Yardi Matrix, DFW ranks among the top six US markets by office project volume. At the same time, office sales approaching $1.4B through May continue attracting institutional and private capital. Investors increasingly view the market as an opportunity to capture higher yields while gateway markets struggle with slower activity.
Challenges remain despite that momentum. Vacancy still sits more than 280 basis points above the national average. Hybrid work continues weighing on demand while new supply outpaces absorption in some submarkets. Lower asking rents also reflect ongoing concessions and heightened competition for tenants.
Even so, major occupiers continue making long-term commitments in the Metroplex. Mercury One signed a 172,089-SF full-building lease in Irving, highlighting demand for quality space. The coworking sector also continues expanding alongside traditional leasing activity.
CoworkingCafe ranks DFW as the nation’s third-largest coworking market with 6.9M SF of space. Flexible offices account for 2.4% of total inventory, with Regus, VariSpace, and Lucid Private Offices leading the market. This flexibility could help support absorption in the years ahead.
What’s Next
DFW’s outlook now depends on how effectively the market absorbs incoming supply. Brokers and developers continue watching leasing activity closely as additional projects come online. Many expect coworking growth and large occupier demand to offset weakness elsewhere in the market.
Meanwhile, DFW’s sizable pipeline continues attracting institutional buyers and lenders as other cities retreat from new construction. Nearly 2.8% of the region’s inventory remains in planning stages, ensuring Dallas stays at the center of national office conversations.
The market’s next phase will depend on corporate expansion, leasing momentum, and investor appetite. Those factors will determine whether DFW can maintain its position as one of America’s strongest office markets.
