Fort Worth's office market is heating up and there is room to grow due to population growth

Fort Worth’s office market, especially downtown, is hot.

Population growth in Texas and especially North Texas has consequences for the real estate market.

“Industrially, it’s been very popular since the pandemic, but the office is really starting to heat up again,” said Todd Burnette, executive director of JLL’s Fort Worth office. “If you look at the numbers, they show that we are starting to get a positive absorption that we haven’t seen in a long time.”

Office employment in Tarrant County has increased 16.2% since August 2024 in 2021. Additionally, the market is seeing increasing demand for high-quality, trophy-class offices following the successful leasing of higher-priced office locations.

“Activity levels increase during showings,” Burnette said.

The downtown Fort Worth market is particularly strong, even compared to other Texas cities, he said.

“Our downtown has a 13.6% vacancy rate in Class A offices,” Burnette says. “If you look at Houston, Dallas, San Antonio and Austin, all of these downtown markets average about 32% vacancy, so we’re in a really good situation.”

As more companies such as Amazonrequire their employees to work in the office, the outlook for leasing here remains strong, he said.

That will probably lead to new construction. There are several projects west of downtown that are ready to break ground, and Burnette expects them to happen early next year.

In March, Crescent real estatewhich quickly completed its first office project in 2023, announced plans for a second office building, Crescent Offices West, as part of its mixed-use development in Fort Worth.

“I bet when they start on that building it will be 50% to 60% pre-leased before they break ground,” he said.

Also on the west side, Goldenrod Companies has a project planned at 1001 University Drive with an office component. The Nebraska-owned company is also the driving force behind the Van Zandt, a 250,000 square meter mixed-use development at 2816 West 7th St. with 95,000 square feet of office space.

The strength of the market is also evident from the number of companies that opt for internal innovations, according to Burnette.

“They want to keep what they have because there aren’t many options,” he said.

And when companies move from a good location, there’s usually someone willing to rent that space, says Cannon Camp, executive vice president at JLL Fort Worth.

“We rented one for about three and a half months before we even got the space back,” Camp said. “We had a few tenants who really wanted it, so we had competition, which landlords always love.”

If there were more high-quality office space available now, Camp believes it would be rented.

“I think there’s a lot of demand for it,” he says.

Camp and Burnette both believe that once the Nov. 5 presidential election is over, demand will increase.

“It’s not about who wins, it’s just the uncertainty,” Burnette said. “Once that’s resolved, I think we’ll see some new buildings coming out of the ground.”

While there isn’t much space currently available in Fort Worth’s central business district, JLL recently began offering 1.32 acres for sale in downtown Fort Worth.

The site has been used by the city but is now vacant and the largest currently available potential development site in Fort Worth’s central business district. The home is located at 900-908 Monroe St. and 319 W. 10th St. near Old City Hall. The two buildings, the Lone Star Gas Building and the Gordon Swift Building, have a combined office space of 93,829 square feet. The block also includes a parking garage with space for 338 cars.

“I think this is going to be a very unique place where someone comes in with smaller floor plans and some will probably look at hotel or residential applications as well,” Burnette said.

Whatever happens to the buildings will be a good deal for Fort Worth, he said.

“This puts a property that wasn’t on the tax rolls there,” Burnette said.

Baldrige Award Part II for the Fort Worth Company

Freese and Nichols got a second one Malcolm Baldrige National Award for Qualitythe highest recognition in the US for high-quality business practices and resilience. The Baldrige Program is a public-private partnership through the U.S. Department of Commerce that honors organizations that demonstrate national leadership in performance excellence.

Freese and Nichols received their initials Baldrige Prize in 2010and became the first engineering/architecture firm to receive the recognition.

“Winning this award again reflects the hard work and dedication of every employee,” said Brian Coltharp, CEO of Freese and Nichols, in a press release. “The rigorous Baldrige interview process has provided us with invaluable feedback that will help shape our future efforts and strengthen our role as sustainable partners for our colleagues and customers.

“As we celebrate our 130th anniversary this year, winning our second Baldrige Award reaffirms our role as a trusted advisor to our clients and inspires us to continue working to become a national role model for business excellence.”

Freese and Nichols join an elite group of 13 returning winners.

Since winning Baldrige in 2010, the company has expanded from its Texas roots to 12 states and now has 1,200 employees.

House of Sport comes to Arlington

A former Sears store at The Parks Mall in Arlington is getting a new purpose Dick’s Sports Housea new concept from Dick’s Sporting Goods. Dick’s sporting goods submitted plans with the state indicating it expects to spend at least $660,000 on the project.

In addition to a full range of sporting goods for sale, House of Sport includes indoor and outdoor sports fields and tracks, climbing walls, equipment repair stations and other activities, along with Dick’s Sporting Goods store offering of sporting goods and sportswear. It will be one of three Houses of Sports in Texas. There are two others in the Houston area.

According to a press release from the City of Arlington, the mall’s ownership will then transform the current Dick’s Sporting Goods space to attract multiple new retail, dining, entertainment and service tenants.

As part of a performance agreement approved by the City Council in 2023, Dick’s Sporting Goods would invest at least $25 million in an initial phase to convert the former Sears space into a sports home by 2026. The mall owner would then invest a minimum of $25 million. of $20 million in a second phase to convert the Dick’s Sporting Goods site into one or more tenant spaces by 2030.

If these and other performance goals are met, the city will provide grant payments for both phases over a period of up to 15 years. Grant payments for the first phase will be equal to 70% of the city’s share of sales tax revenue generated by the new House of Sports, capped at $500,000 per year during the agreement period, up to a total of $5 million. The grant payments for the second phase would be equal to 70% of the city’s share of sales taxes generated by tenants in the space, up to 20% of the actual capital investment, for a total not to exceed $5 million.

According to city officials, the multi-phase redevelopment is expected to generate significant property tax and sales tax revenue for Arlington.

Dick’s Sporting Goods recently broke land on an 800,000-square-foot regional distribution center in south Fort Worth that is expected to bring 300 jobs to the area.

A little bird told me to putt for a good cause

For the first time since Birdies For Charity was introduced as part of the Charles Schwab Challenge in 2005, the 2024 tournament generated a record $20 million in donations.

On October 24, officials from the tournament and Fort Worth Colonial Charities Inc. along with representatives from Birdies For Charities’ 33 nonprofit organizations at Colonial Country Club to celebrate the historic year of giving.

A total of $20.4 million was the final tally, including pledges made possible by a $280,000 matching fund from Fort Worth Colonial Charities Inc., the tournament’s philanthropic entity.

The tournament’s 33 nonprofits worked to secure pledges from their supporters, then the PGA TOUR pros did their part by making 1,116 birdies at the Charles Schwab Challenge last May.

“It is extremely rewarding that we have surpassed the $20 million milestone in Birdies For Charity’s 20th year,” said Logan Dickinson, Chairman of the Charles Schwab Challenge Birdies For Charity.

Of the PGA TOUR events hosting Birdies For Charity campaigns, Colonial’s $20 million raise is one of the largest on tour. Since the program’s local inception in 2005, the annual Birdies For Charity campaign has raised $171 million for participating charities.

Do you have something for the Bob on Business column? Email Bob Francis at [email protected].

Bob Francis is business editor for the Fort Worth Report. Contact him at [email protected]. The Fort Worth Report makes news decisions independently of our board members and financial supporters. Read more about our editorial independence policy here.

Fort Worth’s office market is heating up and there is room to grow due to population growth

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