Retail demand soars; strongest net absorption since 2007

​HOUSTON – Uncertainty in the Houston’s economy has yet to derail retail demand. 

Houston’s retail market experienced the strongest net absorption in a single quarter since fourth quarter 2007. 

Over 1.5 million sf was absorbed—more than the annual net absorption in 2010, 2011 and 2012 combined. 

Big name big box closures, including Sports Authority and The Fresh Market, were not enough to overshadow the significant gains from aggressively expanding grocers in active residential suburban areas. 

H-E-B and Kroger continue their efforts to capture market share in the far suburban areas and represent the majority of anchors in the development pipeline.

As a result, occupancy climbed to a new historical high of 94.2 percent in the overall market. 

Prime Class A space is even higher, spurring more new construction.

As developers move forward with more speculative construction, demand must continue to grow in order to retain occupancy at above average rates.