Dallas-Fort Worth’s office sector is still reeling from the pandemic, and Plano might be the epicenter of its struggles.
The north Dallas suburb is home to four of the region’s top 10 largest office vacancies, totalling nearly 3.4 million square feet of available space, the Dallas Morning News reported. Those four buildings alone account for almost 5 percent of DFW’s 70 million square feet of office vacancies, which includes sublease space.
As of August, the office vacancy rate in Plano was 22.5 percent, compared to 18 percent in DFW overall. The West Plano-Upper Tollway area had 10.31 million square feet of empty space through the third quarter, trailing only downtown Dallas, which had 10.34 million square feet.
“Approximately 33 percent – 19.5 million square feet – of direct space on the market is in blocks over 100,000 square feet, highlighting how large companies have shed space in light of remote/hybrid work,” Andrew Matheny, research manager at commercial property firm Transwestern and Costar, told the outlet.
The largest chunk of vacant space in DFW is in Plano’s former EDS Campus at 5400 Legacy Drive, where almost 1.6 million square feet is available and NexPoint Advisors is planning a $3 billion redevelopment into a 22-acre life sciences campus.
Just a mile down the road, more than 1 million square feet is up for grabs at the former J.C. Penney campus. The next largest vacancies in Plano are at 5320 Legacy Drive and the newly opened Granite Park Six, combining for over 700,000 square feet.
Despite Plano’s struggles, developers remain bullish on the area, as 1.5 million square feet of office space is in the pipeline. Part of the problem in Plano — and downtown Dallas — is that many office buildings are old and outdated. Thus, developers are working to overhaul some of them, either converting them for other uses or renovating them into amenity-filled office environments, which have been the most sought-after corporate destinations in the post-pandemic landscape.
Elsewhere in DFW, some of the largest vacancies include roughly 730,000 square feet in Fort Worth’s former American Airlines headquarters and 589,000 square feet in downtown Dallas’ Fountain Place tower, where landlord Goddard Investment Group is adding a 13,000-square-foot private club.
—Quinn Donoghue
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