HomeMy WebLinkAboutItem 02 - Office Market StudyOffice Market Study
Weinstein, Clower and Associates
cooperatively market the city's assets and resources to potential tenants.
Staff Study:
• The Grapevine market appears to be competitive and not currently in a state of
decline. The vacancy rate is estimated to be between 21% for direct vacancy and
23% for direct and sub -lease vacancy. These rates compare well with the Flower
Mound/Lewisville/Coppell area (26%) and are in parity with the Euless/Bedford
market (22%) and the North Irving market (18%). The only market substantially
under the Grapevine market is Southlake/Colleyville at 9% direct vacancy.
• The lease rate per square foot is estimated to be between $19.37 and $21.30 per
square foot for direct lease. This rate is comparable to other active markets in the
Grapevine region such as Southlake/Colleyville ($22.09), Flower
Mound/Lewisville/Coppell ($19.20) and North Irving ($19.41).
• Of the 87 properties surveyed, seven properties had vacancy rates above 25% and
vacant areas above 10,000 square feet. All but one of the properties noted tenant
specific reasons related to occupant relocation, bankruptcy, buy-outs, consolidations
or lease terminations. However, one property in spite of a recent remodeling of the
building and major redevelopment of the site has failed to lease.
• During the course of this study, ten brokers were interviewed to define the current
market environment and the future potential. All brokers except one, reflected
optimism in the market with stability in leasing and prices. They predicted that
increases in rent would be gradual. One broker felt that the rents would decline on
the newer properties that have to compete for tenants with the older properties.
• As part of the study, fifteen office tenants were interviewed. The results indicated that
tenants primarily were focused on a smaller office space located in proximity to
business owners, employees, airport/highway facilities, restaurants and
entertainment. Grapevine's central location within the Dallas/Fort Worth region also
seems to have a positive impact on bringing tenants into the City. As gas prices
continue to rise and executives become increasingly weary of the commute to Dallas
or Fort Worth, a convenient, central location with quality amenities and the historic
charm of Grapevine will have increasing appeal.
Recommended City and Chamber of Commerce actions focus on networking,
marketing, advertising and potential zoning/sign code amendments. Although the office
market does not currently show signs of decline, monitoring steps are also outlined and
recommended. The action steps focus on bringing new businesses into the market and
capturing them within the Grapevine market. Home based businesses should be made
aware of opportunities within the smaller suite locations and the suite located
businesses should be captured within the larger spaces as they increase in size and
look for new space. Regional advertising within business journals can raise the
awareness of the business advantages of a Grapevine location.
Office Market Study September 13, 2006 (9:28AM)