BOKA Powell was engaged by Hillwood Urban, a Perot Company, to design a 350,000 SF office building in Dallas’ Victory Park. Victory Commons will be adjacent to the Victory light rail station for Dallas Area Rapid Transit and the Trinity Railway Express.
COSTAR: Proximity to Light Rail a Hot Commodity for Offices in Dallas-Fort Worth
By: Paul Hendershot
Rising fuel prices, frustrating traffic congestion and a labor force demanding the convenience provided by light rail have combined to place a new emphasis on transit-oriented development in the Dallas-Fort Worth area. As they seek relocation options, more companies are demanding access to light rail to attract highly sought-after talent in a tight labor market.
Developers have been busy trying to meet this demand. Of the 388 million square feet of existing office space, 13%, or 53 million square feet, is found within a 10-minute walk of a rail station in the metroplex. Of that, 39.9 million square feet is considered higher-end four- and five-star properties.
Landlords are putting a premium on the proximity to light rail. Tenants in office properties located within a 10-minute walk of light rail station can expect to pay $30.51 per square foot, 16% more than the market average of $26.10. When considering only higher-end four- and five-star properties, the premium is reduced to 6%, $33.56 compared to the market average of $31.47.
As developers continue to break ground on new projects within close proximity to transit, CoStar expects this premium to increase over time. There are currently five projects totaling 1.1 million square feet under construction within a 10-minute walk of a rail station; all are located within a one-and-a-half-mile radius of downtown Dallas. For example, Hillwood Urban in partnership with USAA retail, is planning its first speculative tower in Dallas adjacent to the Victory light rail station for Dallas Area Rapid Transit and the Tarrant Railway Express, at 2601 Victory Ave.
The 15-story, 365,000-square-foot office tower is scheduled to be completed in the fall of 2021. The restoration of the 72,500-square-foot Continental Gin Building, located less than 10 minutes from the Baylor University Medical Center Transit Stop in Deep Ellum, is an example of a transit-oriented adaptive reuse project. Being the oldest commercial building in Dallas, and listed in the National Register of Historic Places, the office space is sure to inspire innovation and creativity.