Despite the fact that this year has been the most difficult for commercial real estate in Dallas-Fort Worth since the Great Recession, experts in the field are optimistic that 2024 will mark the beginning of a significant recovery.
As the cost of debt increased over the course of the previous year, lenders grew more conservative, which resulted in a slowdown in office leasing and a nearly complete lack of new project development, as reported by the Dallas Morning News.
The number of new construction projects in North Texas was still second only to that of New York City, despite the fact that the number of commercial building starts dropped by around 17 percent in the first half of the year.
During the first nine months of 2023, Dallas-Fort Worth (DFW) led the nation in commercial sales, despite the fact that revenues were sixty percent lower than they were the previous year.
According to statement made by Bill Kitchens, director of market analytics at CoStar Group, the market will continue to experience a reduction in pricing in the year 2024. From its highest point in 2022 to the end of 2024, he anticipates that prices will have decreased by 24 percent.
According to Andrew Alperstein, who works at PWC, who was quoted by the site, “I think it’s going to be an interesting early 2024.” “With the exception of office space, the fundamentals for retail, industrial, and multifamily real estate are still pretty good.”
This is because to the region’s rapid economic expansion.
According to Alperstein, investors are interested in knowing whether or not the Federal Reserve would reduce interest rates in the year 2024. He predicted that if activity begins to pick up, it would pick up speed very rapidly since investors will not want to miss out on any opportunities to save money.
It is anticipated by local developers that the current state of hardship in the commercial sector would not persist for an extended period of time.
It is going to be quite short-lived, with the exception of the office that is being held. According to John Goff, chairman of Crescent Real Estate, which is situated in Fort Worth, the office has a lot of things that need to be worked out.
Recently, Bob Sulentic, CEO of CBRE, which is situated in Dallas, shared with investors his expectation that the recovery will be gradual. According to him, he believes that the deals market will not begin to recover until the second half of the year 2024 at the earliest.
