HOUSTON - April 16, 2021 - Key Takeaways
Vacancy continues to increase
Absorption remains negative, but the forecast looks brighter
Deliveries and construction pipeline decrease
Rental rates begin to decrease

Houston Highlights

If you look at the glass half full, Houston saw a smaller amount of negative absorption in Q1 2021 than in Q4 2020; however, tenants still vacated 780,000 SF more than they occupied, pushing the vacancy rate from 21.9% to 22.3%. Houston's office inventory increased slightly due only to resizing of buildings because there were no new deliveries in Q1. There is still 3.4 million SF of office space under construction expected to deliver this year, of which is approximately 63% is pre-leased. 2.4 million square feet is spec development, of which 57% is pre-leased. Fingers crossed, office developers will hold off on any proposed developments for the foreseeable future until Houston's abundant variety of office space opportunities can be absorbed.

Executive Summary

Commentary by Blake R. Virgilio, CCIM, SIOR | Vice President (https://www.colliers.com/en/experts/blake-virgilio)

The Houston Office Market continued to feel downward pressure from the pandemic and limited new leasing demand; however, there is now light at the end of the tunnel. Traffic on the highways has... To read the full report, click here: https://www.colliers.com/en/research/houston/q1-2021-hous...

Contact
Lisa Bridges | Director of Market Research