CoStar: Houston’s office vacancy dips to 11.8 percent

HOUSTON – The Houston office market ended third quarter 2013 with a vacancy rate of 11.8 percent, down over 2Q 2013. Rental rates ended 3Q 2013 at $25.11, an increase over 2Q 2013.

Net absorption totaled a positive 2,252,877 sf in 3Q 2013, compared to a positive 725,957 sf in 2Q 2013. Vacant sublease space decreased in 3Q 2013, ending the quarter at 1,856,906 sf.

The largest lease signings occurring in 2013 included:

•   the 546,604-sf lease signed by ConocoPhillips at Energy Center Three in the Katy Freeway market;
•   the 456,000-sf deal signed by Noble Energy Inc. at Noble Energy Center II in the FM 1960 market; and
•   the 428,831-sf lease signed by Technip at Energy Tower III in the Katy Freeway market.

A total of 22 buildings, totaling 2,290,829 sf, were delivered to the market in 3Q 2013, with 11,233,902 sf still under construction at the end of the quarter.

The U.S. National Office vacancy rate decreased to 11.6 percent from 2Q 2013, with net absorption totaling positive 23.48 million sf in 3Q 2013. Average rental rates increased to $21.75, and 244 buildings were delivered to the market totaling more than 12.2 million sf.

Read more at the CoStar Group.