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Overall vacancy is at 6.5%, up from this time last year at 5.7%, due in part to the 6.3 million sq. ft. of vacant space delivered to the market in 2019—a little over half of the total 12 million sq. ft. completed. Of the 16.9 million sq. ft. currently under construction, about three-fourths of that space is available for lease.


Market Highlights

Almost 17 million sq. ft. of construction underway. Overall vacancy is at 6.5%, up from this time last year at 5.7%, due in part to the 6.3 million sq. ft. of vacant space delivered to the market in 2019—a little over half of the total 12 million sq. ft. completed. Of the 16.9 million sq. ft. currently under construction, about three-fourths of that space is available for lease. The vacancy rate for Class A properties is at 11.2%, up from 7.5% this time last year. Year-to-date net absorption is at 5.2 million sq. ft., close to the 5.3 million sq. ft. registered in September 2018. While the asking price for industrial properties has steadily grown over the past few years, it is currently at an average monthly rate of $0.61 per sq. ft. with slight fluctuations during the time in between.

480,000-sq.-ft. distribution center in Waller acquired. Sealy & Co. has purchased a warehouse distribution center in Waller from Broad Ocean Technologies. The property is located at 18140 Kickapoo Road, about 40 miles northwest of Houston. The distribution center was built in 2017 on a 44.5-acre parcel just past the intersection of U.S. Highway 290 and the Grand Parkway. At time of sale, the property was 35% occupied with 313,000 sq. ft. of space available for lease, according to CoStar data. The property was valued at $1.5 million in January, according to the Harris County Appraisal District.

Crude Oil & Rig Count. The closing spot price for a barrel of West Texas Intermediate averaged $55.17 per barrel in the last week of August 2019, down 20.7% from the same period last year, according to the U.S. Energy Information Administration. Baker Hughes reports 886 drilling rigs were working in the U.S. during the second week of September 2019, down 169 rigs, or 16.0%, from the same week in September last year. In the U.S., weekly oil production is still near an all-time high. So, while the number of oil rigs have declined during 2019, production has grown from 11.7 million barrels per day at the beginning of the year, to 12.4 million for the week ending September 6.

Leta Wauson
Director of Research
[email protected]
tel 713 275 9618

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