News Provided by YTexas
March 7, 2022
There’s a race for real estate across Texas as we continue to be the relocation destination of choice. What are top Texas real estate experts seeing on the ground in the commercial and residential markets?
MARIELLE LAMY QUAID
Luxury Realtor & Native Austinite
We’re dealing with a mass exodus out of Silicon Valley. A lot of billionaires are coming here for that sense of autonomy and liberty and that Texas spirit. These are some of the richest people in the world looking to put roots down here in Texas because it provides them the freedom they want.
In homes, these people are looking for more quality of materials—world-class, Architectural Digest–level—than we’ve traditionally seen in Austin. We have spec homes now that reach into the $15, $20 million category.
President at Briggs Freeman Sotheby’s International Realty
Ranches have become an asset class where people want to park wealth. We see people flying into Dallas from Mexico, Australia, or Europe for the weekend determined to buy a property—300, 500, 1,000 acres. We’ve sold $15 million, $18 million properties to people who have never even been to Dallas. They’re buying it off a video. The biggest challenge is coming up with ranches available for the people who want to buy them.
Used to be, once you got above $2 million, the time on market was always significantly longer than it was for the properties below that. Now, the $2 million to $6 million range is just flying off the shelves. People have even said that “ugly is the new cute”—so houses with a few warts are selling as fast as spectacular houses.
President of Advisory Services for Dallas-Fort Worth at CBRE
We have so many headquarters moving to the DFW area, including my own company, CBRE. It’s such a diversified market. If we could point to one industry that’s really driving it, it’s financial services, from fund managers like Fortress Investment Group or Canyon Partners to Fortune 500s like JPMorgan and Wells Fargo.
“Flight to quality” remains a trend nationwide. Companies are looking to figure out how to make the office a place where people want to be. It’s a little counterintuitive, but even in a pandemic, they want people to be able to come in, safely, and have collaborative spaces.
Industrial properties are completely on fire right now, and supply is a big issue. But DFW has a leg up on most markets there—not only are we centrally located, but there’s unlimited land.
Meanwhile, retail has made a slow return post-pandemic, but it is back. We’re seeing a lot of activity, particularly in the fast-casual restaurant
Principal & Co-Founder at Aquila Commercial
Things have changed in the Austin commercial market, especially with the announcement of Tesla moving its HQ here. The office market used to be bellwether, but now industrial is leading the way. In industrial, we’re seeing 20 to 30 percent increases annually in rental rates.
But office is coming back too. We’ve got about 4 million square feet coming over the next two years. If we continue with the same net absorption, we’ll go from 13 percent vacancy in office properties to below 10 percent.