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Houston Office Market Snapshot Commercial Real Estate Economic Data and Information - remington square III

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Office market vacancy increases to 21.6%. Midway through the second quarter, the vacancy rate edged up by 20 basis points to 21.6%, from 21.4% this time last month. Year-to-date net absorption stands at negative 1.9 million sq. ft. as companies such as Technip, which announced its merger with FMC Technologies in 2017, vacated  376,000 sq. ft. of Class A space in the Energy Corridor in Q1 2018. In addition, a sizeable block of office space in the West Belt area has been placed on the sublease market by GE Oil & Gas, which totals 182,000 sq. ft., located at 4425 Westway Park Blvd. So far in 2018 only 240,224 sq. ft. has been delivered, with 38% of that space available for lease.

Class A office building in Sugar Land has new owner. Three Sugar Creek, a six-story, 154,263-sq.-ft., Class A office in Sugar Land, has been acquired by Wedge Commercial. Built in 2008, the Class A asset was 95% leased at the time of sale by Radler Enterprises. Aetna is the building’s largest tenant, occupying 26,492 sq. ft. Investment sales of office properties in the Houston area were down year-over-year with the annual sales transaction volume totaling $840 million, a -39.6% drop from April 2017, according to Real Capital Analytics.

Two deals totaling 94,000 sq. ft. inked in West Belt submarket. Acclara Solutions signed an 82,940-sq.-ft. lease while Aerotek took 10,796 sq. ft. at Remington Square III at 10713 W. Sam Houston Parkway N. With Class A vacancy in the West Belt at 31.6%, these two leases totaling almost 94,000 sq. ft. are a noteworthy event in this submarket.

Overall, the outlook for Houston remains positive. Houston jobs grew at a strong annualized pace of 4.7% (35,400 jobs) over the three months ending in April. The leading job gains were in professional and business services (11,000). Furthermore, the unemployment rate in Houston was 4.6% in April, down 0.1 percentage points from March.

Houston Office Market Snapshot Commercial Real Estate Economic Data and Information

Houston Office Market Snapshot Commercial Real Estate Economic Data and Information

Houston Office Market Snapshot Commercial Real Estate Economic Data and Information


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

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