Two companies just signed sizable office leases in the Dallas area — a good sign for office landlords as overall leasing activity is down to start the year.
Heating and air-conditioning manufacturing company Texas AirSystems leased the entire 100,000-square-foot full-building Royal Ridge II, in the Las Colinas area of Irving.
And New York Life Insurance leased 24,000 square feet in the 24-story Pinnacle Tower near Galleria Dallas, the Dallas Morning News reported.
Stream Realty agents represented the tenants, and JLL represented the landlords for both transactions.
The Texas AirSystems deal marks one of the largest office leases signed in Irving this year. The HVAC company will relocate from a smaller building in Irving, highlighting the firm’s growth into one of the largest independent providers of systems from major manufacturers.
New York Life Insurance has likewise operated in smaller office buildings in North Dallas, on Merit Drive and on Greenville Avenue.
The transactions also highlight the trend of companies favoring newly built or renovated buildings, as they offer a greater chance to overcome the remote work movement and lure employees back to the office.
Menlo Equities, which bought the Royal Ridge office park at 8081 Royal Ridge Parkway in 2021, has added outdoor spaces, renovated lobbies and made other tenant area upgrades.
New York Life Real Estate Investors and Encore Office bought the Pinnacle Tower, at 5005 LBJ Freeway, in 2016. It recently received more than $9 million in renovations, and a slew of new tenants followed.
Office sales and leasing activity is down in Dallas-Fort Worth compared to last year. Net office leasing dropped by nearly 680,000 square feet year-over-year from January through February, and office sales fell by 80 percent. While these figures show significant drop-offs, North Texas still ranked ninth in the nation for office sales during that stretch.
—Quinn Donoghue
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