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Year-over-year, as of April 2021, overall vacancy in the Houston office market is at 24.6% and availability is at 29.4%, both up from this time last year.
RISE IN VACANCY TO 24.6%
Year-over-year, as of April 2021, overall vacancy in the Houston office market is at 24.6% and availability is at 29.4%, both up from this time last year. Year-to-date, the Houston office market has recorded 3.2 million sq. ft. of leasing activity—which is comprised of both new leases and renewals—while net absorption (move-ins minus move-outs) is at negative 2.3 million sq. ft. There have been three projects delivered so far in 2021 totaling 153,400 sq. ft., and 18 developments under construction at 4.1 million sq. ft. The Houston average asking full-service rent is at $29.21 per sq. ft., down slightly from this time last year.
SIGNIFICANT LEASE TRANSACTIONS IN 2021
Linde Engineering has leased 120,454 sq. ft. in Sierra Pines II at 1575 Sawdust Road in The Woodlands. The company will occupy the second and third floors in the six-story, Class A office building. Also, NewRez has signed a 60,188-sq. ft. at 17000 Katy Freeway in the Energy Corridor. With this transaction, the 174,521-sq. ft. building is now 70% leased. Axiom Space Inc. has signed a 32,389-sq. ft. office lease expansion at 1290 Hercules Ave. near the NASA Johnson Space Center. The new lease brings the property to full occupancy.
HOUSTON ECONOMIC INDICATORS
The Federal Reserve Bank of Dallas reported that Houston metro area payrolls rose in March by 31,500, due in part to recovery from Winter Storm Uri in February and the lifting of pandemic restrictions on businesses March 10. February data were also revised from a slight decline to growth of nearly 5,700 jobs. That brought payroll job gains since April 2020 to 160,100—a recovery of over 45% of the jobs lost in the initial months of the pandemic.
Director of Research
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