Q1 2026 Update: Metroport Commercial Group Released May 2026
Allen and McKinney added more than one million square feet of new industrial buildings in Q1 2026, one of the largest single‑quarter construction totals in the Dallas–Fort Worth region. Even with this level of new supply, companies continued moving into space, and occupied square footage increased. Tenant demand remains active, and the submarket enters Q2 with a healthy pipeline of committed move‑ins.
Q1 2026 Vacancy and Occupancy Trends in the Allen–McKinney Industrial Market
Vacancy reached 11.8 percent in Q1. The increase came from the volume of new buildings completed, not from companies leaving the market. Construction added 1,042,450 square feet of new industrial space in one quarter, placing Allen/McKinney among the three most active construction corridors in DFW.
Despite this surge in new supply, occupied space still grew. Companies took 192,698 square feet of additional space during the same period, showing that new buildings are being leased and filled rather than sitting idle.
Why this matters: Vacancy rose because the market grew, not because demand weakened. The submarket is expanding, and tenants are taking space as it becomes available.
Allen–McKinney Industrial Leasing Activity in Q1 2026
Companies leased 611,264 square feet of industrial space in Allen/McKinney during Q1. At the metro level, DFW recorded 18.5 million square feet of leasing activity — the strongest first quarter on record. The region also entered Q2 with approximately 10.1 million square feet of tenant commitments scheduled to take occupancy in upcoming quarters.
Allen/McKinney holds a meaningful share of the new buildings those tenants will occupy.
Why this matters: Leasing momentum is not slowing. The backlog of signed leases across DFW will continue to flow into the submarket through the rest of the year.
Rent Levels and Tenant Mix
Average rents in Allen/McKinney held at $10.36 per square foot net, an 18.5 percent premium over the DFW metro average of $8.71.
The premium reflects the tenant base: aerospace and defense contractors, advanced manufacturers, semiconductor‑adjacent users, and technology companies that rely on Collin County’s skilled labor pool. These users tend to stay in place longer and are less likely to relocate for marginal rent savings.
Why this matters: The tenant mix supports rent stability. The submarket is not driven by short‑term logistics users but by companies with long‑term operational needs.
Construction Pipeline in Q1 2026
Construction remained active, with 1,106,487 square feet still underway at the end of Q1. Most of this volume is tied to a large data center expansion that does not compete with traditional industrial buildings.
The competitive pipeline — the space that actually matters for industrial tenants — is smaller than the headline number suggests. The most competitive segment is recently completed mid‑bay buildings in the 150,000 to 499,000 square‑foot range.
Why this matters: Tenants currently have the most negotiating leverage in mid‑bay buildings delivered this year. Larger and specialized projects are not adding pressure to the industrial market.
Capital Markets Activity
Two industrial land sites totaling approximately 63 acres near McKinney National Airport sold in April 2026. The seller returned capital to investors within seven months of acquisition.
Why this matters: Institutional buyers remain confident in the long‑term growth of the Allen/McKinney corridor. Investors are still deploying capital into the area and achieving quick returns.
What This Means for Tenants
- More new buildings are available, especially in the mid‑bay range.
- Companies entering the market have room to negotiate on recently completed space.
- Rent levels remain higher than the DFW average due to the tenant mix and labor advantages.
- The pipeline of upcoming move‑ins suggests continued competition for well‑located space.
What This Means for Owners and Investors
- Vacancy increases reflect growth, not weakness.
- New buildings are leasing quickly, even in a heavy construction quarter.
- Rent premiums remain supported by the tenant base.
- Institutional activity confirms long‑term confidence in the corridor.
Q2 2026 Outlook for the Allen–McKinney Industrial Market
The key factor to watch is the lease‑up pace of recently completed buildings. Early activity suggests continued movement, supported by the region’s strong backlog of tenant commitments. With construction moderating and demand holding steady, the submarket is positioned for stable performance through mid‑2026.
Data sources: CoStar Group, Q1 2026 market data; Metroport Commercial Group analysis; additional Q1 2026 North Texas industrial market sources.
