A tightening industrial vacancy rate and a diminishing development pipeline have pushed Dallas-Fort Worth to the upper echelon of U.S. warehouse and logistics markets. 

Marcus & Millichap ranked DFW No. 3 on its new 2026 National Industrial Index as private investors have fueled metrowide transaction growth. Trading increased by around 40% year-over-year through the first quarter in DFW, thanks to a nearly 50% increase in transactions in the $1M to $10M range.

The national brokerage firm attributed that increase to DFW’s rising long-term investment demand due to the region’s robust employment growth, growing leasing momentum and diminishing supply. 

Courtesy of CapRock Partners

CapRock Partners broke ground on the 250K SF McKinney Air Business Park near the McKinney National Airport earlier this year.

“DFW is seen across the nation as a hub [for employment], with a diversified economy, massive population growth, good infrastructure,” Marcus & Millichap Senior Managing Director of Investments Adam Abushagur said of the factors that play into investors’ confidence in the metro. “We’ve been less affected by this cycle compared to a lot of other markets across the U.S, such as an LA, a New York and so on.”

Charlotte and Orlando, Florida, topped the industrial index, and the rest of the top 10 was filled out by Sun Belt and Midwest cities with a strong supply-demand balance, while Los Angeles and New York City were at Nos. 20 and 21, respectively. The declining development pipeline has tempered vacancy risks in DFW and many Sun Belt and Midwest markets, according to Marcus & Millichap’s 2026 Industrial Investment Midyear Outlook.

Marcus & Millichap projected DFW will add around 40,000 net new jobs in 2026. That employment growth, coupled with the region’s expanding population, is fueling just about all project types in the region, Abushagur said. 

For the industrial sector, employment and population growth mean more warehouse space is needed as more products need to be manufactured and delivered. Plus, more small businesses are occupying shallow-bay spaces, which is also contributing to the region’s tightening vacancy rate. 

DFW completions are projected to hit their lowest level since 2013, pushing the sector’s vacancy rate down to 8.9% in the first quarter. That’s the region’s lowest rate in three years.

Industrial demand has been strong in DFW for several years, but investors’ appetites have shifted away from the smaller infill assets that had been most popular, according to Trey McGhin, a principal at the land brokerage and investment firm Dosch Marshall Real Estate.

“Over the last 12 months, institutional equity has really returned for the industrial development market, and that, coupled with the tightening vacancy rates and supply being at a lower point, groups are now … really trying to pursue bigger product again,” McGhin said.

That has led to investors making deals in the higher-growth areas of the metro have more available land for development. Areas like Denton, South Dallas, Rockwall, Royce City, Terrell, Forney and Waxahachie are seeing renewed demand because of the desire to build 500K SF to 1M SF facilities, McGhin said.

McKinney has emerged as the hottest industrial market in DFW over the last year. Despite having one of the smallest industrial footprints in the region, it boasts some of DFW’s highest rents, thanks to tremendous growth around the expanding McKinney National Airport.

While McGhin expects demand to remain strong in the submarket, many of the best deals have already been done. 

“You’re starting to get to the point where a lot of those McKinney opportunities are more picked over,” McGhin said. “They still exist, but there’s definitely going to be more push to be on sort of the east side of the airport.”

Developers have also moved north of McKinney to the emerging city of Melissa for industrial opportunities, according to McGhin. 

The Fort Worth logistics corridor, northeast Dallas and the South Stemmons submarket are also expected to continue attracting investor attention this year, Marcus & Millichap reported. 

Abushagur attributed the increased investor confidence in DFW to the region’s status as a steady market on the national scene. McGhin said the return of institutional equity has also boosted investor confidence in getting deals capitalized. 

“When times are tough, it’s a lot easier to find $15M from a capital group than it is to go find $40M from a capital group,” McGhin said. “With the leasing being stronger, vacancy being tighter … and there just being more liquidity in the industrial capital markets, all of that is leading to more and larger deal activity.”

The first three months of 2026 were the most active period for office landlords since before the pandemic.

Office tenants signed roughly 120M SF in new leases in the first quarter of the year, a 25% increase compared to the first quarter of 2025 and the highest quarterly total since 2018, according to a CoStar report.

The surge was largely driven by a higher volume of smaller leases — a trend that emerged after the pandemic. The number of leases signed hit its highest point going back a decade.

“While the quarterly figure signifies continued momentum for national office recovery, the composition of leasing activity reflects an intensification of patterns that have emerged in the leasing office market since the pandemic began,” CoStar National Director of Office Analytics Phil Mobley wrote in the analysis.

Since the beginning of 2023, new lease sizes remained about 15% below pre-pandemic averages, due in part to restricted hiring and the lack of larger space in newer buildings, according to the report.

Smaller leases also tend to be more fluid with shorter terms, promoting more leasing activity.

Amid the surge, almost half of the nation’s largest office markets have had leasing return within 10% of their pre-pandemic averages — primarily led by Charlotte, New York City, Miami and San Francisco, which are above their 2015 to 2019 averages.

Courtesy of CoStar Group

The demand from banks and financial institutions, which have maintained a higher in-office attendance record, has uplifted leasing recovery. That trend is particularly strong in Charlotte, where Citigroup, JPMorgan Chase and Sumitomo Mitsui Banking Corp. have all announced significant expansions.

But there are still a handful of metropolitan areas — including Atlanta, Washington, D.C., Chicago, Denver, Seattle, San Diego and Philadelphia — that are still below 20% of their pre-pandemic average of office leasing activity.

Looking forward, the first quarter’s momentum may not be sustainable through 2026 amid economic and uncertainty pressures, Mobley wrote.

“On the demand side, the return-to-office movement is reaching its apogee, and job growth remains tepid,” he wrote. “Rising energy costs associated with the conflict with Iran also present a headwind to economic growth and, in turn, to demand for office space.”

Despite steady rent growth, a deep pool of educated renters and one of the smallest construction pipelines in the country, Chicago’s multifamily market is being held back by one thing.

Institutional capital needs to catch up.

Local and private investors are keeping deals moving, but once institutional money fully recognizes the opportunity to buy assets at below replacement cost in a growing market, Chicago multifamily will take off, Lument Managing Director Todd Stofflet told Bisnow.

“The continued strength in Chicago is starting to wake the herd up, and they’re starting to ask the questions, trying to develop investment theses on Chicago and some of the other Midwestern markets,” Stofflet said. “It takes time and it takes transactions.”

Chicago has one of the smallest multifamily construction pipelines in the country, according to a report from real estate investment sales company Lument shared exclusively with Bisnow.

Units in the pipeline make up less than 1% of Chicago’s total multifamily inventory, a rate only met by Houston and San Francisco. 

There are probably about a dozen sites that are shovel-ready in the city that aren’t getting built because developers aren’t finding equity for them, Stofflet said. Equity challenges make it difficult to project exactly how many units will deliver in the city and when. 

Many of the city’s traditional major sponsors, like JPMorgan Chase and Ares, have pulled back from the market, so the difficulty for investors is finding a source of equity excited about developing in the city and comfortable with returns on its investment, Stofflet said. Many of the institutional investors that were on the sidelines are heading back to growth markets like Austin, Charlotte and Nashville, he said.

“I look at Chicago, and I see less than 1% in the pipeline, 7% year-over-year rent growth in downtown,” Stofflet said. “At some point, you just have to focus back on yield and where I’m going to make more money, and that is the Midwest right now.”

Chicago started off the year with strong multifamily sales. The city recorded nearly $1B in multifamily transactions in the first quarter, one of its strongest quarterly performances on record, according to the report. 

But yearly sales won’t come near a record — total year-end multifamily volume in the Chicago area for 2025 will likely be close to the transaction mark in both 2023 and 2024, which was about $3.9B, Stofflet said. 

That’s a far cry from the nearly $5.9B of multifamily sales in the Chicago area in 2022. Of the 12,400 units on the market in the city, 4,000 have closed or are under contract as buyers and sellers feel out pricing, Stofflet said.  

As more product hits the market, it is starting to draw a wider range of investors back to Chicago, Stofflet said. Groups that have wanted to sell for a while are starting to test the waters to see what today’s market will bear.

Downtown Chicago did see some return of institutional and private equity firms — they accounted for more than half of the dollar volume and nearly a third of transactions, according to the report.

“You’re starting to see institutional groups back on your bid lists in Chicagoland, but for the most part, the groups that are winning are private capital just because they have a longer-term perspective,” Stofflet said. 

Seeking lower rent is renters’ top reason for leaving their units, but Stofflet said that shouldn’t be a big concern for landlords. Chicago landlords are comfortable continuing to push rents because there isn’t a significant amount of new inventory coming online, which means landlords don’t have to compete over concessions. 

Some renters are staying in the rental pool longer and coupling together later, and other renters are leaving Chicago entirely because they can’t afford to live in the city, Stofflet said. 

“For every person leaving Chicago, we’re being replaced with one that is five years younger and making $10K more,” he said. 

The percentage of Chicagoans between 25 and 34 years old with a bachelor’s degree or higher is nearly 11% above the national average, and the city’s demographics are shifting. Chicago’s major universities are bringing an influx of educated people to the city, Stofflet said.  

But still, some investors remain skeptical of Chicago’s reputation because they are inundated with “clickbait” that the city is filled with crime, overly progressive and bankrupt, Stofflet said. Until those perceptions shift, institutional capital is likely to stay away, leaving deals to contrarian investors and family offices.

“The more that we can show a stable transaction environment in Chicago, the more that institutional money will feel comfortable investing back in Chicago,” Stofflet said.

CORRECTION, NOV. 11, 3:25 P.M. CT: This story has been updated to correct the misspelling of a company name.

Charlotte’s commercial real estate market is showing reasons for optimism, thanks in no small part to the area’s robust job market. 

Among the 14 metropolitan areas with a population of more than 1 million people, Charlotte recorded the highest employment growth — up 2.8% — in 2025 so far. Charlotte is seeing greater stability in its office market, while net absorption of industrial space neared 1M SF in the second quarter. 

“Charlotte remains a robust growth market — not just hot but resilient,” said Robert Memory, department manager of utility engineering and coordination for Colliers Engineering & Design. “It is transitioning from a place of rapid speculative growth with very steep price increases to more moderate but still solid growth with more emphasis on sustainability, mixed-use, redevelopment and affordability.”

If advising a developer or investor, he said he would look carefully at where demand is underserved, including affordable and mid-tier housing, adaptive reuse and mixed-use infill.

Memory will speak at Bisnow’s Charlotte Construction and Development Conference on Nov. 4 on a panel titled Next Development Frontier: Site Selection, Opportunity Zones, Underdeveloped Areas and Assets to Maximize Returns.

Register here for the event. 

Bisnow spoke with Memory to learn more about the state of the Charlotte market, where he is seeing the most activity and the potential challenges that lie ahead. 

Bisnow: You said the market is not just hot but resilient. What do you think is behind that? 

Memory: I’m looking at the job numbers to start. Colliers Engineering & Design opened a Charlotte office over eight years ago, based on the growth projection and opportunities as a national company looking to expand our engineering services. When you look at what Charlotte has to offer — several professional sports teams, an incredible downtown area — these are the things that attract both companies and individuals. 

Charlotte’s downtown is the nucleus that bonds the growth outward throughout Mecklenburg County and beyond. Everything funnels into Charlotte’s thriving downtown. 

Bisnow: Does your background in transportation infrastructure give you a particular perspective on this market?

Memory: I spent 30 years with the North Carolina Department of Transportation, and in my experience, improving interstates enhances the opportunity for more people to relocate. 

During those three decades, I had the opportunity to work on multiple highway improvement projects in Mecklenburg County, including the I-485 loop, I-85 widening, I-77 express lanes, NC 49 widening and the widening of Independence Boulevard. I saw significant growth throughout the area thanks to those improvements to the highway infrastructure. 

Today, they are forming teams to restructure I-77 South, and any time you improve traffic flow in a specific area, it opens up the corridor for more development. 

Bisnow: What sets Charlotte apart from other cities, and where do you see its opportunities and its challenges? 

Memory: There are several things that make Charlotte stand out, not least of which is its population growth. Charlotte saw a 7.3% population growth between 2019 and 2024, and it’s expected to continue to grow. Along with that, Charlotte is more affordable than many U.S. metros when you factor in living costs, housing and taxes. 

Charlotte is also a well-known banking hub with a diverse and growing economic base that includes advanced manufacturing, tech, research and development, biotech and more. This has piqued foreign interest, and Charlotte is drawing a significant amount of foreign investment, particularly in the manufacturing, energy and telecom sectors. 

All of this, combined with our high quality of life thanks to nearby schools, a mix of urban amenities and easy access to mountains and coastal areas, truly sets Charlotte apart. 

That being said, the area is facing several challenges, from pressures on housing affordability to material costs, labor shortages and supply chain disruptions that are delaying the delivery of much-needed housing. Additionally, there are infrastructure and transit gaps, including a limited public transit system, and risks from broader economic uncertainties surrounding interest rates, inflation and credit markets, which will influence development viability.

Bisnow: Where do you expect to see the most construction and development activity in Charlotte in 2026?

Memory: Based on multiple sources, office vacancies are high, particularly for older, Class-B and C buildings. As a result, conversion, demolition or reuse plans are increasingly likely for these assets. 

There is a strong multifamily development pipeline, particularly in the urban core, South End and the suburbs. But new supply is cooling in starts, so existing sectors may see more turnover. 

Mixed-use and public-private development projects, including for apartments, retail and office, are prominent, especially in master-planned communities. And finally, affordable housing and build-to-rent are gaining importance, given housing cost pressures.

Bisnow: What do you hope people learn from your panel at the Nov. 4 N.C. construction and development event? 

Memory: I hope attendees walk away with a clearer understanding of the key challenges and opportunities shaping North Carolina’s construction and development landscape. Whether it is navigating new regulations, embracing sustainable practices or leveraging technology to streamline projects, our goal is to provide practical insights that developers, contractors and community stakeholders can apply immediately. You’re looking at a thriving city, but at the same time, we’re facing real challenges, and those challenges are not going away. 

I also hope it sparks more collaboration across sectors because the future of construction in our state depends on partnerships that prioritize innovation, resilience and long-term value.

Click here for more information about the event. 

This article was produced in collaboration between Colliers Engineering & Design and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com. 

Renters are increasingly choosing to stay put rather than venture into the unknown, where elevated home prices and broader economic volatility await.

Apartments are staying full longer as high mortgage rates and limited inventory keep renters in place.

Historically, about half of apartment renters choose not to renew their leases. In the first quarter of 2025, that number has dropped to between 30% and 35% in the portfolios of major multifamily landlords, according to Piper Sandler Managing Director of Research Alex Goldfarb.

Large multifamily REITs have reported some of the lowest turnover rates in their companies’ history in recent calls with analysts, like Equity Residential, which reported a 7.9% turnover rate in the first quarter. 

“We’ve seen price growth still put a lot of burden financially on families and individuals across the country,” National Apartment Association Vice President of Research George Ratiu said. “With volatility and uncertainty, I think a lot of folks renting might choose to take what I would say is the certainty of rent over making a long-term commitment.”

Major REITs like Camden Property Trust reported a 31% annualized net turnover rate in Q1, one of the lowest in its history. Essex Property Trust said its turnover landed at 35%, below the company’s long-term average.

Marcie Williams, chief strategy officer of The Bainbridge Cos., which develops, acquires and manages multifamily properties nationwide, is seeing roughly two-thirds of tenants stay put at many of its communities.

“That [retention rate] is extremely high,” Williams said. “I’ve been in this business over 30 years, and that is definitely not typical overall.”

Since President Donald Trump’s “Liberation Day” tariff announcement at the beginning April, price expectations and trade policies have seesawed, prompting fears of a trade war and heightening economic uncertainty. 

Consumer confidence plunged to a 13-year low in April, prompting many commercial real estate professionals to prepare for a recession. But that hasn’t impacted apartment owners, and some see them as a clear winner in an environment with costs spiking. 

“There are a few stories of residents expressing concern due to job loss, but nothing at the moment that is impacting any of our stats, results or projections for the next 90 days in the market,” Equity Residential Chief Operating Officer Michael Manelis said on his company’s first-quarter earnings call. 

Manelis said even in D.C. and Northern Virginia, where federal government job losses are having an outsized economic impact, Equity’s complexes are more than 97% occupied.

But multifamily turnover has been shrinking for the past two years, driven by rising home prices, high interest rates and a shift in renter preferences toward more livable and amenity-rich spaces — a change that began during the pandemic, Goldfarb said.

Less than a third of renters are looking to buy a home within the next five years, according to a survey conducted by Gallup. The cost of homeownership, including the down payment, was cited as the biggest barrier for renters trying to break into the housing market.

“It’s really just the uncertainty with the economy and still the high barriers to entry, with higher interest rates and higher down payments, that has allowed our residents to be able to enjoy the service that we provide and the apartment home that they currently live in,” Williams said.

For landlords, that stability is a win. Lower turnover reduces operating and maintenance costs — typically ranging from $750 to $1,800 per unit — as well as marketing expenses and vacancy loss, since each unoccupied day results in lost revenue, she said.

“There really is nothing negative that comes from having lower turnover,” Williams said.

The bulk of move-outs and lease expirations occur in the spring and summer, Ratiu said, so lower turnover rates at the beginning or end of the year are more common. But turnover is expected to stay low during peak move-out season, even with new units continuing to come to the market, Goldfarb said.

After eight consecutive quarters of record apartment deliveries, completions have fallen from 153,000 units at the end of 2024 to 116,100 units in the first quarter, according to RealPage.

“This year is the second and final year of this outsized supply wave that we’ve seen, primarily in the Sun Belt,” Goldfarb said. “But last year, we had a big supply [increase], and yet turnover declined. So I don’t see any reason why turnover should increase as the second wave of supply delivers.”

With fewer move-outs, owners of the new apartments that have come online are fighting to get in on the action and competing more aggressively for tenants.

That is driving up concessions on new leases, sometimes as high as two months of free rent and $1K gift cards, especially in Sun Belt cities like Jacksonville and Charlotte, Williams said.

“When those properties are 0% occupied, competing with an apartment community that’s 95% occupied, they have to have those concessions to keep up the velocity and the velocity you know you want to make,” Williams said.

But deliveries are expected to fall 14% in 2025, according to Multi-Housing News, tipping the balance of power back toward landlords. With fewer new options coming online and renters growing hesitant to move out, prices are expected to start rising.

“The landlord goes, OK, how much do we think we can raise rent before we raise too much that the person just says, ‘The heck with it, I’m out?’” Goldfarb said. “And I think most people would agree that the mental cost of moving exceeds the actual dollar amount.”

Greysteel has announced the listing of a mixed-use opportunity zone development site at 45 Q Street SW, located in the rapidly expanding Southwest Waterfront area of Washington, D.C.

This fully entitled property is situated in proximity to the Navy Yard, The Wharf, and Buzzard Point. “45 Q Street is a rare opportunity to deliver a dynamic mix-use project in an opportunity zone between Nationals Baseball Stadium and Audi Field,” said W. Kyle Tangney, Senior Managing Director at Greysteel. “I’m not aware of another shovel ready opportunity in the entire US that features all the neighborhood and site dynamics this project has going for it.”

The property is currently entitled for a 152,245-square-foot mixed-use project featuring a 78,414-square-foot Moxy Hotel with 182 rooms under the Marriott International umbrella, 64,949 square feet of residential units, 6,546 square feet of ground-floor retail space, and a 4,436-square-foot rooftop venue.

The 36-story 101 Marietta St. tower is for sale. The Atlanta Business Journal reports that real estate observers estimate that offers for the building will come in at about $67.5 million. The 675,000-square-foot building overlooks Centennial Yards. 

101 Marietta is owned by Dilweg Cos., which paid $68.8 million for the property in 2015. It tried to sell the building in 2020. At that time, it expected offers of more than $150 million. 

Downtown’s office vacancy rate remains over 30%, according to fourth-quarter 2024 data from CBRE.

Newmark’s Jay O’Meara, Justin Parsonnet and Ryan Reethof, along with CBRE’s Will Yowell, are marketing 101 Marietta for sale. 

The building is 62% leased. Its tenants include the Atlanta Hawks and coworking company Industrious. It also includes the offices for developer Centennial Yards Co. 

The Bascom Group, LLC has retained Noel Aguirre and Sean Lieppman of Lee & Associates to market and lease a 4,100-square-foot ground-floor space at 200 Pine Ave. in Long Beach. Located in the city’s downtown area, the space features an adjoining 3,865-square-foot lower-level space.

The space, which offers patio capability, is second-generation restaurant space suitable for a full-service restaurant concept in the downtown Long Beach market, according to The Bascom Group. The location has dedicated on-site retail and restaurant parking and is at the base of a six-story, 65,909-square-foot office building renovated in 2022.

David Kim, Managing Partner at The Bascom Group, said, “200 Pine is in the heart of the Pine Avenue entertainment district, with numerous retailers and restaurants, such as Altar Society Brewing Company. This building is within two blocks of City Hall, Billie Jean King Public Library, George Deukmejian County Court House, the State Building, and the newly expanded Long Beach Convention & Entertainment Center.”

After publishing its 2025 Atlanta Office Investment Forecast Report, Marcus & Millichap’s John Leonard commented, “Atlanta’s office market is at a turning point, with corporate expansions and investor confidence driving renewed momentum. As vacancy rates decline and demand for high-quality office space strengthens, the metro is well-positioned for growth in 2025.”  Insights include: 

• Atlanta’s employment market will expand by 27,000 jobs in 2025, with 2,000 new office-using roles, supporting long-term leasing demand. 

• Vacancy rates are projected to decline to 19.4%, driven by corporate expansions and reduced new supply. 

• Office construction will slow to its lowest level in a decade, with inventory growing by 0.4%, primarily in Midtown, Sandy Springs and Alpharetta. 

• Northwest Atlanta and Northlake stand out as investment opportunities, with triple-digit vacancy declines and rent growth exceeding 1% in 2024. 

The average asking rent will rise to $27.52 per square foot, supported by falling vacancy rates and a limited construction pipeline. 

Starboard CRE, reportedly the largest, independently owned commercial real estate firm in San Francisco, has listed 6440 Shellmound St. in Emeryville for $6,500,000. The fully wired data center facility is fully leased under an absolute triple-net lease to Lumen Communications, LLC until 2026.

Serving as CenturyLink’s key telecommunications facility since 2000, the property benefits from a windowless design that enhances temperature regulation for critical systems. The Bay Area’s mild climate further reduces cooling costs, making it an efficient and strategic location for telecommunications operations, Starboard said.

“We’re thrilled to bring this exceptional property to market,” said Craig Hansson, managing principal at Starboard. “It’s not every day you find a facility like this that’s already set up with this level of infrastructure located right in the heart of the Bay Area tech scene. For companies looking to establish or expand their data operations, this is about as turnkey as it gets.”

Register Today to “Be in the Room” when Michael Brennan receives Connect CRE’s Lifetime Achievement Award and will participate in the Keynote Interview with Kevin Brennan, also of Brennan Investment Group. Join us at Connect Industrial Midwest 2025 on the afternoon of Wednesday, March 5, at Joe’s Live in Rosemont, IL, for this exclusive presentation!