Despite the ups and downs of the national economy, the Dallas-Fort Worth metroplex expands. I find it hard to believe that at the beginning of the tech boom in the 1990s, our job base totaled 2.6 million versus 3.7 million today. At that time, our telecom corridor was rapidly expanding and Legacy was in its toddler years. Those 1.1 million new jobs fueled the expansion and creation of many business hubs.
As we look around DFW today, new development continues to flow into established areas to accommodate our growth. Other areas, however, are also emerging as potential new submarkets. One of those is Allen. Currently, Allen and McKinney are included in the broader Richardson – Plano submarket. Although that combination makes sense today, it probably doesn’t in the not too distant future.
Of all the next tier suburbs in the path of development, Allen looks to be positioned for transformative growth. Currently, the Allen corridor has about 3 million square feet of office space. All of that is located along a two mile stretch between Bethany Drive and Exchange Parkway.
While some space existed back in the 1980s, predominantly in community-scale office and medical buildings, the first notable wave of business space was developed in the mid- to late-1990s. These included Enterprise Office Center, Allen Office Center and Allen Tech Center. But after the tech bust, Allen fell quiet until the mid-2000s.
At this point, DFW’s strong economy returned and the northward progression of new development along the Tollway and I-75 continued. Development in greater Legacy picked up quickly. Trademark also started planning Watters Creek in Allen. The initial phases of Watters Creek opened in 2008 and served as a “seed,” much like Legacy Town Center’s office and retail did back in 2002.
One distinguishing feature of Allen is its tremendous early housing growth because it served as a bedroom community for the I-75 corridor. To put that in perspective, in 1990, the City of Allen had less than 20,000 residents. That number more than doubled by 2000 and currently stands at 100,000. In addition to single family housing, 7,500 multifamily units were developed in the Allen corridor over that period.
With all the housing, retail quickly followed. In 2000, there was about two million square feet in the Allen corridor. Today there is 6.7 million, with many larger centers, such as Allen Premium Outlets, Fairview Town Center and the Villages at Allen serving a broad trade area that runs well beyond immediate neighborhoods. In addition, the Shops at Legacy and retail at Watters Creek (which opened in 2008) helped create a cohesive mixed use identity for the developing office core.
Today, Allen continues to develop. Projects like the new Watters Creek convention center and hotel, set to open next year, will add to area’s draw. One Bethany East, Kaizen Development Partners’ 125,000 square foot Class A office building delivering next month will provide tenants with new high-quality office options. In fact, Netscout’s decision to leave Plano and locate their 145,000 square feet build-to-suit in Allen is tied directly to the area’s high quality business location, near-by amenities, and proximity to a deep talent pool.
Looking ahead, Allen’s regional location, accessibility, established newer housing base, proximity to a deep and diverse labor pool, and ample multifamily and retail offerings build a foundation for it to emerge as a key commercial submarket.
What’s even more important is that Allen has land available for large-scale development that is under strong institutional ownership. Kaizen’s One Bethany holdings in Allen’s core allow it to build 800,000 to 1 million square feet of Class A office space. Hines’ holdings west of I-75 and 121 near Alma Road and Howard Hughes’ planned Allentowne mixed use development at I-75 and 121 are poised. These projects – as well as continued development in Allen’s core – provide excellent opportunities for companies seeking to take advantage of a north Dallas location, but sidestep greater Legacy’s increasing traffic congestion, similar to the way Cypress Waters in Coppell and Circle T Ranch in Westlake are now attracting large space users.
One thing is certain: it’ll be exciting to see how Allen develops over the coming years.
- Commercial submarkets take years to become established. While office development in Legacy began in the early 1980s, it was not until 2000 that it began to take-off and not until 2010 before it really accelerated.
- As of the mid 1990s, only 5 million square feet of office had been developed in Legacy and almost no multifamily. Today, it boasts more than 25 million square feet of office space and 12 million square feet of multifamily.
- Interestingly, office development today in the 10 square miles that encompass Allen’s I-75 corridor (almost the same size as Legacy) looks a lot like Legacy did back in the mid-1990s.
- Allen’s excellent fundamentals of strong regional access, already established apartment housing (which took until the mid-2000s to reach in Legacy), and available land for development puts it on a similar development path to Legacy – especially as companies look to the next growth locations (like Circle T Ranch and CityLine).
- New projects will reinforce Allen’s evolution – especially around its core. Other major mixed use projects closer to 121, like those planned by Howard Hughes and Hines, will stretch the current submarket dramatically north.