Key takeaway
DFW office underwriting should start with the building's tenants, capital needs and competitive position. The public Q1 2026 evidence shows a market where higher-quality space can lease while broader availability remains elevated. Uptown, Downtown Dallas, Las Colinas and Plano/Richardson provide different settings for that analysis; the metro figures cannot price a particular building or rank every submarket.
Public evidence: Q1 2026
| Provider | Source-defined observation | Underwriting implication |
|---|---|---|
| CBRE | 1.8M SF of quarterly leasing and 28.5% availability | Leasing activity coexists with substantial competing space; assess the tenant's alternatives. |
| CBRE | $34.46/SF average direct asking rent, up 5.3% year over year | Asking-rent growth needs a separate check against concessions, tenant improvements and achieved economics. |
| CBRE | 2.8M SF under construction, all Class A; prime office had positive absorption | Compare the building with the quality and location of incoming competition. |
| Colliers | 430,592 SF of positive absorption, mainly from Class A leasing; 20.4% vacancy | Improvement within this provider's universe supports selective leasing analysis. |
| Colliers | 6.9M SF of available sublease space | Include sublease options in the competitive set and tenant-retention assumptions. |
Availability and vacancy measure different things. CBRE and Colliers also use their own coverage and definitions. Preserve the source and period rather than combining these observations into a single metro or submarket estimate. Neither cited summary supplies a complete cluster-level cap-rate or concession table.
Use Forecast Evaluation and Research Transferability before comparing DFW with Austin or Houston. Align the report period, survey boundary, class or trophy definition and vacancy versus availability measure. A difference between unrelated series is not a quality premium or a return ranking. Use CRE Valuation Methodologies for the timed landlord cash and CRE Valuation Methodologies for a supported pricing comparison.
Compare strategies by cluster
| Cluster | Strategy to evaluate | Evidence that must support it |
|---|---|---|
| Uptown / Turtle Creek | Income from a well-positioned office building | Actual tenants, rollover, renewals, effective rents, capital requirements and entry basis |
| Downtown Dallas / Deep Ellum / Cedars | Office repositioning or adaptive reuse | Floor plates, daylight, building systems, zoning, conversion costs, financing and demand for the proposed use |
| Las Colinas / Irving | Tenant retention, targeted repositioning or an alternative use | Employer and tenant commitments, access, competing buildings, parcel entitlements and project economics |
| Plano / Richardson / Legacy West | Selective suburban office or redevelopment | Building-specific competitive position, employer access, tenant demand, obsolescence costs and feasible land use |
These strategies require separate investment cases. A nearby employer, rail station or retail district is useful context; the property still needs demonstrated demand at a rent that covers its costs.
Test income and conversion separately
For an income acquisition, reconcile the rent roll with lease expirations, credit, downtime, concessions, tenant improvements and leasing commissions. Stress-test renewal probability and the cost of replacing a large tenant. Asking rent alone cannot establish distributable cash flow.
For a conversion, establish technical feasibility and a complete development budget before assigning value to the alternative use. A low purchase price can be outweighed by structural changes, mechanical systems, financing costs or a long approval process. Compare the completed project's rents and absorption with its own residential, hotel or other competitive set.
Use these Q1 2026 observations as dated context. Refresh the building's leases, competing availability and transaction evidence before making a current allocation decision.
Financing assumptions
Editorial and financing review: October 1, 2026. Operating figures retain their stated provider, geography and reporting period. A later review date does not make an earlier observation current.
The Fed raised its target to 3.75%–4.00% on September 16. The September 30 Treasury close was 5.29% for the 10-year and 5.64% for the 30-year. Source: Federal Reserve FOMC Statement September 16 2026; Source: U.S. Treasury Daily Par Yield Curve September 2026.
Size debt from income after vacancy, tenant improvements, commissions and capital reserves. Test rollover and refinance proceeds with a higher borrowing cost and a wider exit cap rate; a newly signed lease or a successful trophy loan does not establish general office liquidity. See U.S. Commercial Real Estate Outlook Q4 2026 for the common macro scenarios.
Related pages
- DFW Office Market
- Uptown and Turtle Creek
- Downtown Dallas Deep Ellum and Cedars
- Las Colinas and Irving
- Plano Richardson Telecom Corridor
- Office Bifurcation
- Adaptive Reuse of Obsolete Office
Sources
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Source: CBRE Dallas/Fort Worth Office Figures Q1 2026
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Source: Colliers Dallas-Fort Worth Office Market Report 2026 Q1
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Source: Federal Reserve FOMC Statement September 16 2026
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Source: U.S. Treasury Daily Par Yield Curve September 2026