2008 Frisco Forecast

Below are summary notes from the Weitzman 18th Annual Shopping Center Survey & Forecast and comments made by Steve Brown, Dallas Morning News Real Estate Editor at a meeting of the Frisco Developers Council.  Both were held in January, 2008.

 

Metroplex Region:   

  • Metroplex region is a blessed economy; but has cooled off some.
  • Anticipated 100,000 new jobs annually will be down to a projected 65,000 new jobs, which will still be No. 2 or 3 in the US.
  • Office space, approximately 5.5 million SF under development.
  • 2007 office leasing was down about 50% in the Metroplex.
  • New housing starts are down. Single family home foreclosures will be a problem for the next 12-18 months.
  • Apartment development is a hot market right now, people who cannot qualify for a home loan are leasing apartments and houses.
  • About 4 million SF of retail is under construction and vacancy rate is about 10%, not bad.
  • DFW Region economy is still better off than most other places in the US.

 

City of Frisco:  Overall market in Frisco is good and remains strong.

 

  1. Office:

·         Office development in 2007 was approximately 1.5 million square feet.

·         Office leasing absorbed approximately 600,000 square feet or 40% absorbed.

·         Office vacancy is approximately 20%, which ranks third best in the Metroplex.

  1. Retail:

·         At 95% retail occupancy, which is considered full occupancy, Frisco ranks fourth best in retail submarket occupancy in the Metroplex, (1. McKinney 98%, 2. Allen 97%, 3. Cedar Hill 96%)·         Frisco ranks fourth best in 2007 retail construction with approximately 550,177 SF.       (1. Lewisville/Flower Mound 1.1M SF, 2. Grand Prairie 640,000 SF, 3. McKinney 615,000 SF)

·         Retail construction in Frisco remains strong with approximately 500,000 SF of retail under construction.

  1. Hotels:

·         Frisco has 3 full service hotels and 3 limited service hotels with a total of 1,034 rooms.

·         Four hotels are under construction, which will add 469 rooms for a total of 1,503 rooms.

·         Four hotels are pending, which would add 477 rooms, or a potential 1,980 rooms.

4.   Housing:

·         Several major commercial and mixed-use projects at major intersections along the Dallas North Tollway from SH 121 to US380 have been announced or are under construction.

·         New single family starts are down about 40%.

·         Apartment development is a hot market as Frisco has approximately 2,500 units in the pipeline.

5.   Overall outlook:

·         Overall economic outlook is good with slowed single family housing development and several major commercial/mixed-use projects underway in 2008.

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