Houston’s office market had a phenomenal first quarter, recording 2.3M SF of positive net absorption, the highest quarterly amount since 2.5M SF was recorded in Q2 2007.
More than 2.1M SF was added to Houston’s office inventory and, at the close of Q1, 15.1M SF of new office development was under construction. Energy giants such as Apache, BHP, ExxonMobil, Phillips 66, and Shell currently have expansion projects in the construction pipeline, and many others have announced plans to build new office buildings to accommodate growth.
The citywide average rental rate increased 2.5% from $25.45 per SF to $26.09 per SF over the quarter and 6.1% from $24.59 per SF over the year. Citywide average Class A rents increased 3.7% and Class B rents increased 2.0% over the quarter.
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