DFW is a hot spot for industrial construction as population booms and e-commerce surges


The convergence of new consumers and the e-commerce companies that covet them continue to make the Dallas-Fort Worth industrial construction market one of the nation’s strongest.

As the region’s population increases, consumers lured by the area’s low cost of living and warm climate are being followed by companies drawn to the region’s growing market and business-friendly environment.

“A lot of people are moving from regressive, high-tax states to low-tax states and there’s a need to move product through a warehouse,” local developer Brian Flaherty said. Each new resident requires 150 square feet of warehouse to meet their needs for products, he said.

The big-box industry

“The DFW big-box market continues to shine during these trying times,” Colliers International wrote in its report on the local industrial market for the third quarter of 2020. Colliers expected the market to absorb 20 million square feet of industrial space for the year and noted that 36 buildings totaling 18.1 million square feet were under construction.

“There is no slow down anticipated in this sector as more national distributors look to take advantage of the abundance and low cost of labor throughout the metroplex,” Colliers researchers wrote.

JLL research showed that 33.7 million square feet of industrial space was delivered in DFW from the fourth quarter of 2019 to the third quarter of 2020, marking a 12-month record for the region.

Capitalizing on the demand for industrial space

Bob Moore Construction is helping developers capitalize on the demand by building speculative industrial facilities, said Kyle Whitesell, executive vice president for the Arlington-based general contractor. “There are a lot of companies moving in to set up distribution space,” he said.

Companies want to tap into the expanding consumer market as quickly as possible and do not want to wait months for a new facility to be built. “They’re looking for space and looking for it fast,” Whitesell said.

Existing businesses are expanding their industrial facilities as well. “A lot of them are in building products or in food or medical or cleaning supplies,” Whitesell said.

Covid-19 and the rise in e-commerce have fueled much of the demand for products as well as the need for space to support their distribution. “We’re seeing companies that are in support industries to e-commerce firms like Amazon looking for space,” said Whitesell, citing packaging and logistics businesses as examples.

McKinney Airport Center, a two-building industrial complex with 230,000 square feet, has been designed for tenants needing 10,000 square feet to 20,000 square feet. “I knew it was going to be a good site because it’s near the airport and I wanted it to be flexible for the users,” said Jesse Pruitt, principal of Somervell Commercial, which has served as the development manager for Stonemont Financial Group, the project’s Atlanta-based developer.

“I wanted to be able to take what I call smaller tenants because the competition in the area is buildings that are 300,000 and 500,000 square feet,” Pruitt said. “I’m getting a lot of activity on the project and I haven’t even tilted a wall yet, which is very unusual.”

Collin County’s residential growth is generating demand from service providers like air-conditioning companies, Pruitt said. “They need to be closer to the area where the development is so we’re seeing a lot of those types of tenants plus some other national tenants.”

Flaherty expects industrial construction to remain strong, particularly in areas farther removed from downtown where land can be acquired for $2 to $3 per square foot versus $6 to $8 per square foot for infill developments. “DFW doesn’t have an ocean or another boundary that would constrain it, so it can grow rapidly,” he said.

It seems likely to do so.


Contact Bob Moore Construction to discuss partnering on the construction needs for your next industrial project.

Bob Moore Construction started in 1946 and is one of the largest commercial general contractors in Dallas, Fort Worth and all of Texas. It has delivered commercial construction projects in Texas and around the United States. The company is an industry leader in tilt-up construction.