|Location, Location, Location*||Location, Location, Location*||https://www.recenter.tamu.edu/news/newstalk-texas/?Item=13987||2016-08-02T05:00:00Z||2016-08-02T21:20:00Z|
HOUSTON - More than 10 million sf of sublease office space is now in the Houston market.
An additional 1 million sf is expected in third quarter 2016.
The additional sublease space will push Houston’s effective office vacancy rate above 21 percent.
Sublease rates are increasingly aggressive, notes CBRE, including some instances of marketing a $0.0 net rate (operating expenses only), as sublessors try to recoup any costs.
Total absorption remains barely positive for the year, with 147,000 sf leased.
Office construction continues to wind down, with only 4.2 million sf underway in 2Q 2016 compared to 11.8 million sf in 2Q 2015 and 16.3 million in 2Q 2014.
Houston absorbed 1.5 million sf of retail space in 2Q 2016—the most in any quarter since 4Q 2007.
Average occupancy grew 0.4 points to 94.2 percent. More than 3 million sf is under construction, equivalent to 1 percent of the current inventory.
Sites once slated for multifamily projects are now available for retail development, giving rise to more mixed-use developments.
The multifamily market absorbed 1,694 units in June and 8,436 over the past 12 months. Inventory has grown by 21,600 units over the past 12 months.
Overall occupancy stands at 89.7 percent, down from 91.4 percent in June 2015. On a square foot basis, average rental rates have grown 1.5 percent since last June.
Class B, C and D properties continue to perform well, while properties in lease-up are dragging down overall Class A occupancy rates.
*CBRE, Colliers JLL and Transwestern provided the data included in this section of Economy at a Glance.
|Greater Houston Partnership||Houston-The Woodlands-Sugar Land||Office|| https://www.houston.org/pdf/research/quickview/Economy_at_a_Glance.pdf|
See The Economy at a Glance full PDF.
See Houston Market Overview Market Research and 2Q 2016 Houston Office reports, Houston Multifamily reports and Houston Retail reports.