CBRE: Houston office availability hits 20-year high

​​​​​HOUSTON – Local office sublease space surpassed 10.2 million sf, pushing availability (direct and sublease) to a 20-year high of 19.8 percent.

According to the latest market update from CBRE, the​​ market will need to absorb 8.4 million sf to return to the 20-year average availibility of 15.8 percent. This could take three to five years. 

Almost one million sf of additional sublease is expected to hit the market next quarter. Combined with vacancy from new construction, availability could exceed 21 percent in 2017, CBRE says.

Construction is down to 4.2 million sf (51.4 percent preleased) and new starts are virtually nonexistent.

While demand has slowed, CBRE says new construction with high-end amenities is still popular among tenants. When leasing activity picks up, these properties will likely be in high demand.

Downtown and west Houston continue to bear the brunt of the downturn, representing more than 62 percent of the total sublease availability.

Year to date, more than 600,000 sf of sublease space has been absorbed, double the amount absorbed over the same period last year.​​