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Dallas Office Vacancy Rates Declined in Third Quarter

The Dallas commercial office market saw vacancies fall to 25.8 percent as demand for premier space rose.

Updated on Oct. 9, 2026 in Commercial

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Dallas commercial office vacancies fell to 25.8 percent in the third quarter of 2026 as demand for premier space surged. AI Illustration. Upload story photo >

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Dallas office vacancies dropped to 25.8 percent in the third quarter of 2026, marking a one-percentage-point decrease. This shift was driven by a combination of building conversions and the strategic demolition of older properties.

Why it matters

Financial services companies are significantly expanding their footprints in the region, driving increased demand for high-end office locations. This appetite for premier space has enabled landlords to increase rental rates while offering tenant improvement packages.

Dallas currently has 2.1 million square feet of office space under construction, while gross rents in Uptown have reached approximately $130 per square foot. Recent data also shows rent increases of 870 basis points in Uptown and 1500 basis points in Preston Center.

The players

Goldman Sachs

This global financial institution is expanding its regional footprint with a new office at NorthEnd scheduled for 2028.

Morgan Stanley

This multinational investment bank and financial services company is slated to occupy a new space at 2401 McKinney Avenue in 2031.

The details

The market evolution is fueled by major corporate projects, including the $268 million Knox Street mixed-use development. With 26,000 financial workers located in Plano and 230 tenants situated near the Katy Trail, the city remains a significant hub for professional services.

Timeline

  1. Dallas office vacancy reached 25.8 percent in Q3 2026.

  2. Goldman Sachs will open its NorthEnd office in 2028.

  3. Morgan Stanley will occupy 2401 McKinney Avenue in 2031.

  4. Office space in the Katy Trail area is projected to reach 5.8 million square feet by 2035.

Culture Shift

The regional office market is currently undergoing a structural pivot toward mixed-use developments that prioritize amenities over traditional configurations. This reflects a wider societal shift where urban centers are transitioning from purely corporate corridors to integrated environments.

Businesses looking to lease space in Uptown or Preston Center should anticipate higher base rents and competitive conditions for premier properties. Tenants may find that landlords are increasingly willing to negotiate substantial tenant improvement packages to secure long-term leases.

The takeaway

The Dallas office market is tightening as high-end demand outpaces current supply, particularly in areas near the Katy Trail. Occupiers should prioritize long-term planning, as major corporate expansions are expected to further impact availability and pricing through the next decade.

Further reading

For more information on regional market shifts, visit the Dallas Commercial section.

Source note: This article includes information reported by The Real Deal New York.

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Is the expansion of business office space in your area a positive sign for the economy?