Dallas - Fort Worth Industrial Summary - 4Q 2025
Dallas-Fort Worth’s industrial market closed 2025 on solid footing, balancing elevated vacancy with resilient tenant demand and sustained long-term growth. The market now encompasses approximately 1.23 billion square feet of industrial inventory, making it one of the largest logistics hubs in the country. Over the past 12 months, the region recorded 25.8 million square feet of net absorption alongside 24.3 million square feet of deliveries, reflecting continued tenant expansion despite broader economic uncertainty.
Vacancy ended the year at 9.0%, essentially flat year-over-year and stabilizing after the sharp increases experienced during the height of the development cycle. Direct vacancy remains elevated compared to pre-2023 levels, but quarterly data shows improvement from the 10% peak reached in 2024. Total inventory across flex, shallow-bay, and bulk product types has grown to more than 1.12 billion square feet, with overall vacancy hovering in the mid-9% range by year-end 2025. This stabilization suggests the market is beginning to digest the significant volume of speculative development delivered since 2020, particularly in bulk distribution facilities concentrated along major transportation corridors.
Leasing activity regained momentum throughout 2025, with more than 72 million square feet leased during the year, reversing the slowdown seen after the 2022 peak. Demand remains strongest in bulk logistics facilities of 200,000 square feet and above, driven by e-commerce, manufacturing, and data center-related users. Large-format distribution space continues to attract national tenants, particularly in outlying submarkets where modern buildings with higher clear heights and immediate highway access are readily available. Sublease availability remains elevated compared to historical norms, but tenants have actively absorbed discounted sublet space, contributing to positive net absorption across multiple submarkets.
Rent growth has moderated but remains healthy. Market-wide asking rents increased 4.2% year-over- year, with average asking rents now at approximately $10.20 per square foot. While this pace is below the double-digit growth recorded in 2022, it remains above long-term historical averages and continues to outperform many peer markets nationally. Logistics product specifically reports rents just above $9.00 per square foot, reflecting steady demand for large-scale distribution space. Infill locations near DFW Airport and along key interstate corridors continue to command premium pricing, particularly for modern facilities with 32-foot to 40-foot clear heights and enhanced trailer parking.
Construction activity has cooled from its 2023 peak but remains active. Roughly 40 million square feet is currently under construction market-wide, representing about 3% of total inventory. Preleasing levels remain below 50%, indicating some continued short-term supply pressure. However, construction starts have become more measured, and developers are increasingly selective with new speculative projects as underwriting standards tighten and capital costs remain elevated. The shift toward more disciplined development should help moderate vacancy levels over the coming quarters.
From an investment standpoint, sales activity remains consistent with historical averages, with approximately $2.4 billion in volume recorded over the past year and cap rates averaging in the low- 6% range. Institutional capital remains engaged but disciplined, targeting stabilized logistics assets in core and high-growth submarkets. Portfolio transactions continue to account for a significant portion of overall volume, while private buyers remain active in smaller infill and shallow-bay assets.
Overall, Dallas-Fort Worth’s industrial sector enters 2026 with stabilized vacancy, steady rent growth, positive absorption, and a moderating pipeline—positioning the market for a more balanced expansion cycle following several years of outsized development activity.
The information contained herein was obtained from CoStar; however, Bradford Companies makes no guarantees, warranties, or representation as to the completeness or accuracy thereof. The presentation of this property is submitted subject to errors, omissions, change of price or conditions prior to sale or lease or withdrawal without notice.