Dallas office construction closed 2024 with commanding numbers: 2.9 million square feet under construction and 2.8 million square feet delivered across 18 properties. Construction starts surged 50% year-over-year to 1.7 million square feet across 17 projects, signaling renewed developer confidence despite market headwinds.
Yet beneath these construction figures lies a more complex market reality. The vacancy rate climbed to 24% as of January, jumping 330 basis points year-over-year, while listing rates averaged $31.40 per square foot—up 14.9% annually. Average sale pricing settled around $107 per square foot, trailing the national average.
The coworking inventory expanded to 5.2 million square feet across 284 locations, reflecting Dallas’s position as a flexible workspace hub. We manage projects within this environment of active development, elevated vacancies, and increasingly selective tenant demand for high-amenity, healthy buildings.
How Are Supply, Starts, Deliveries, Pricing, and Vacancy Trending?
Dallas office construction metrics reveal a market balancing significant development activity with structural pressures. We track five core indicators that shape project feasibility and investment decisions across the Metroplex.
Construction Supply Pipeline
The pipeline reached 2.9 million square feet at year-end 2024, representing about 1% of Dallas’ total office inventory. This level exceeds the national threshold by 20 basis points and outpaces peer markets including Houston at 0.8% and Atlanta at 0.5%. However, Austin leads the region at 3.7%, highlighting Dallas’ measured approach to speculative development amid uncertain absorption patterns.
Most under-construction inventory concentrates in Uptown at 66%, with northern suburban submarkets like Far North Dallas and Richardson/Plano capturing the remainder. This geographic clustering reflects tenant preferences for amenity-rich locations with proximity to residential density and transportation access.
Construction Starts Accelerate
Construction starts surged to 1.7 million square feet across 17 projects in 2024, marking a 50% year-over-year increase. This acceleration demonstrates continued developer confidence despite market headwinds. Projects breaking ground typically feature pre-leasing commitments or build-to-suit arrangements that reduce speculative risk.
The starts figure represents renewed momentum after slower activity in prior years. We attribute this uptick to pent-up demand for modern, healthy building features and strategic positioning by developers anticipating future absorption cycles.
Office Deliveries and Completions
Delivered inventory totaled 2.8 million square feet across 18 properties in 2024, representing 0.8% of existing stock. While this marked nearly 30% decline year-over-year, Dallas captured the largest delivery share among peer metros. Major completions included Ryan Tower in Plano at 409,000 square feet and continued phases of mixed-use developments.
Delivery timing reflects construction schedules initiated during stronger market conditions. Projects completing now often benefit from reduced competition as fewer buildings reach market simultaneously.
Vacancy Rates and Market Absorption
Vacancy climbed to 24% as of January 2025, up 330 basis points year-over-year and above the U.S. average of 19.7%. This increase stems from a combination of new supply entering the market and continued space optimization by existing tenants. Submarkets with older inventory like Dallas CBD, Mid-Cities, and LBJ Freeway report vacancy rates between 25.5% and 31.6%.
Flight-to-quality trends drive divergent performance between asset classes. Class A properties absorbed 1.1 million square feet in 2024, while Class B buildings recorded negative absorption of 842,152 square feet, underscoring tenant preferences for modern amenities and building systems.
Pricing and Investment Activity
Average sale prices averaged approximately $107 per square foot in 2024, below the national average of $174 per square foot. This pricing differential reflects both market conditions and the relative affordability that attracts corporate relocations to Dallas. Investment volume declined to $1.5 billion with an average cap rate of 8.3% across 195 transactions.
Listing rates averaged $31.4 per square foot, up 14.9% year-over-year. Class A rates reached $33.79 per square foot near record levels, while Class B rates declined to $23.90 per square foot. This widening spread reinforces the flight-to-quality dynamic affecting absorption patterns.
Flexible and Coworking Space Growth
Coworking inventory reached 5.2 million square feet across 284 locations, representing about 1.8% of total office stock. This share aligns with several Sun Belt peers but remains below top-flex markets nationally. Major operators include Regus with 598,606 square feet across 35 locations and emerging providers like Workbox, which recently opened 50,000 square feet in Victory Plaza.
The flexible space segment reflects changing workplace patterns and provides absorption capacity as traditional lease structures evolve. We expect continued growth as companies test hybrid work models and seek operational flexibility during market transitions.
Which Projects And Design Trends Define New Dallas Offices?
Amenity-rich towers anchored near parks and mixed-use hubs represent the current direction of Dallas office construction. At Parkside Uptown, the 30-story Bank of America Tower soars above Klyde Warren Park, integrating landscaped terraces throughout its stepped massing. The tower’s Sky Lobby sits more than 100 feet above street level, creating panoramic views of Uptown and Downtown Dallas while serving as a central gathering space with coffee service and outdoor terrace access.
The building’s amenity-filled podium engages directly with the streetscape below. Ground-level retail, wide sidewalks, and a shaded corner plaza foster community interaction while the tower’s stepped forms create multiple outdoor tenant terraces at various levels, effectively extending the adjacent park onto the building itself.
Indoor Air Quality Takes Center Stage
Health-focused mechanical systems distinguish new Dallas office construction from previous generations of buildings. Parkside Uptown floors employ a 100% outside air economizer with no air recirculation between floors, preventing cross-contamination while exceeding ASHRAE standards. MERV 13 filters, commonly trusted by hospitals, remove airborne bacteria and allergens from the incoming air supply.
Optional upgrades include ultraviolet or bipolar ionization systems for additional protection. These advanced air circulation and filtration systems respond directly to post-pandemic tenant concerns about workplace health and safety, positioning buildings with superior indoor air quality as more competitive in the leasing market.
Suburban Mixed-Use Gains Momentum
Beyond downtown, suburban office development continues within larger mixed-use districts. A 23-story tower delivering roughly 409,000 square feet in Plano recently completed as part of a broader mixed-use development, reporting strong pre-leasing results at completion. These projects typically integrate office space with retail, dining, and residential components, creating walkable environments that mirror urban density in suburban settings.
Office-To-Residential Conversions Accelerate
Rising vacancy rates fuel growing interest in office-to-residential conversions across Dallas. One downtown tower successfully converted 14 stories into 291 residential units despite receiving a lower feasibility score, demonstrating how market conditions can override technical challenges when financing and design coordination align properly.
The regional conversion pipeline includes substantial square footage. Analysis shows 43 Tier I buildings representing approximately 4.8 million square feet and 353 Tier II buildings totaling about 43.1 million square feet score as viable candidates for conversion. Key feasibility factors include walkability scores, building age, and floorplate dimensions that accommodate residential unit layouts with adequate natural light access.
How Does Permitting And Approvals For Office Projects Work In Dallas?
Navigating Dallas permitting requires strategic timing and understanding of parallel processes. We start office projects with the City’s optional pre-development meeting to address critical site factors early. This meeting covers addressing, utilities, drainage, platting, zoning compliance, and easements before formal submissions.
The prescreen and intake phase provides essential early validation. After submitting initial materials, the city targets a 5-business-day completeness check. This step identifies missing documentation or procedural issues before plan review begins.
Site Permit Strategy For Project Acceleration
We often utilize the optional site permit phase to maintain project momentum. This allows civil and site work to begin while building permits process simultaneously. The parallel approach reduces overall project timelines by several weeks.
Site permits cover foundation work, utilities installation, and grading. This phased approach requires careful coordination between site contractors and building permit documentation to ensure consistency across all submissions.
Building Permit Plan Review Process
Building permit plan review targets approximately 15 business days for initial review. The review encompasses zoning compliance, building code requirements, MEP systems, energy and green code standards, fire safety provisions, and landscaping elements.
Multiple city departments examine different aspects of the submission. Zoning verification ensures proposed use aligns with district regulations. Building officials review structural elements and code compliance. Fire marshals evaluate life safety systems and egress requirements.
Energy code review has become increasingly rigorous. Projects must demonstrate compliance with current efficiency standards and green building requirements. MEP systems receive detailed scrutiny for capacity, design, and code adherence.
Construction Phase Compliance Requirements
During construction, we schedule required inspections at specific milestones. Foundation, framing, MEP rough-in, and final inspections must occur before proceeding to subsequent phases. Approved plans must remain onsite throughout construction.
Dallas restricts construction hours to Monday through Friday, 7 a.m. to 7 p.m., and Saturday 8 a.m. to 6 p.m. We coordinate our construction schedules within these parameters to maintain compliance and community relations.
Drainage compliance requires particular attention. Lot-to-lot runoff violations can halt construction and require expensive remediation. We implement proper drainage controls during site preparation to prevent these issues.
Final Approvals And Certificate Of Occupancy
Obtaining the Certificate of Occupancy requires completing all final inspections and life-safety tests. Fire alarm systems, sprinkler functionality, emergency lighting, and egress routes receive thorough examination.
The CO process verifies that completed construction matches approved plans. Building officials confirm accessibility compliance, mechanical system operation, and overall safety provisions before issuing the certificate.
For projects with minor remaining items, Temporary Certificates may be available under specific conditions. These allow limited occupancy while completing non-essential work like landscaping or minor finishes.
Where Is The Next Wave Of Office Development Happening Across DFW?
Several major office developments are reshaping DFW’s landscape, concentrating activity around mixed-use hubs anchored by parks and transit access. We see developers prioritizing comprehensive districts over isolated towers, creating integrated environments where office space benefits from retail, dining, and residential components.
The projects range from targeted infill development to massive greenfield sites. Many feature central parks as focal points, reflecting market demand for outdoor amenities and community gathering spaces.
Design District And Central Dallas Developments
Hi Line Square stands as the Design District’s signature office development, featuring a 17-story tower with approximately 186,000 square feet of workspace. The project includes a 6,000-square-foot outdoor terrace connected directly to the office floors, plus a 30-story residential component and roughly 45,000 square feet of retail space.
The development positions itself as a dynamic urban gateway, leveraging the Design District’s industrial heritage while adding modern amenities. We coordinate sitework to integrate with existing infrastructure while maintaining the area’s authentic character.
Downtown Dallas continues evolving with Bank of America Plaza receiving a major upgrade valued at $350 million. The improvements target both office space enhancements within the 1.85 million-square-foot structure and a 300-room luxury hotel component occupying 10 to 12 floors.
North Dallas Transformation
The Dallas International District represents one of the region’s most ambitious mixed-use office projects, spanning approximately 450 acres in North Dallas. The development centers on a 20-acre park called Dallas International Commons, designed with interactive water features, climbing structures, and festival spaces.
We can approach this scale of development by coordinating multiple phases while maintaining unified design standards. The district targets international businesses and includes office space for various chambers of commerce, creating a true business hub with global reach.
The Prism Center already serves as a hub for international trade offices, demonstrating early momentum in attracting the targeted tenant base. Construction management focuses on phased delivery to allow early occupancy while later phases continue development.
Suburban Mega-Projects
Sloan Corners in Allen and Fairview could ultimately deliver more than 10 million square feet of office space at full build-out across 500 acres. The development includes substantial housing, retail, hotels, and more than 50 acres of parks and open space.
Haggard Farms in Plano transforms a historic 142-acre agricultural tract into a mixed-use development including an estimated 650,000 square feet of office space. The project preserves the site’s agricultural heritage through The Almanac, a farm-to-market themed dining center with outdoor event space.
Infrastructure work completed in early 2025 supports Phase I delivery, which includes 100,000 square feet of retail, 350 multifamily units, and park facilities. We sequence construction to allow early retail and residential occupancy while office components follow market absorption.
Frisco’s Continued Expansion
The Mix project in Frisco’s North Platinum Corridor targets approximately 2 million square feet of office space within a $3 billion, 112-acre development. The design centers around a 9-acre central park, with 375,000 square feet of retail, two hotels, and 630 townhomes and urban living units.
Frisco City Council approved $113 million in performance-based grants for infrastructure and remediation support, demonstrating municipal commitment to the project’s success. We coordinate with city utilities and transportation planning to ensure seamless integration with existing Frisco infrastructure.
The first phase encompasses 26 acres with approximately 100,000 square feet of retail space, a 120,000-square-foot medical office building, and 650 apartments. This phased approach allows market testing while establishing the development’s identity.
Convention District Opportunities
The planned $3.7 billion realignment of the Kay Bailey Hutchison Convention Center creates significant redevelopment potential for adjacent office projects. The replacement facility will encompass 2.5 million square feet, opening up 30 acres of currently underutilized land for private development.
We anticipate substantial office demand as the new convention center attracts increased business activity. The deck park spanning I-30 will improve connectivity between downtown and surrounding neighborhoods, enhancing site accessibility for office developments.
Construction of the replacement facility provides a clear timeline for adjacent development opportunities. We coordinate early planning to position office projects for delivery as the new convention center reaches completion.
Conclusion and Next Steps for Planning Office Projects in Dallas
Dallas office construction presents a complex landscape where robust development activity meets significant market challenges. The 2.9 million square feet under construction and accelerated starts of 1.7 million square feet signal continued developer confidence, yet the 24% vacancy rate demands strategic positioning for any new office project. We approach this environment by focusing on tenant preferences for health-conscious buildings and amenity-rich environments that can command premium rents even in a selective market.
Successful office development in Dallas requires early coordination with city permitting processes and thorough market analysis. The City’s pre-development meetings provide valuable guidance on addressing, utilities, and zoning requirements before formal submission. W
Meanwhile, tracking pipeline data, pricing trends, and flex space demand helps us program appropriate square footage and amenities that align with current leasing conditions. IAQ strategies like MERV 13 filtration and 100% outside air systems have become baseline expectations, while conversion feasibility analysis using walkability scores and floorplate configurations opens alternative development paths in high-vacancy submarkets.
Contact EB3 Construction to coordinate your Dallas office construction project with experienced general contracting expertise.
