E Fort Bend Commercial Real Estate Trends
- Office vacancy increases, but so does leasing activity
- Medical Office vacancy increases and average rents drop
- Industrial vacancy drops and average rents increase
- Retail vacancy falls and net absorption increases
The E Fort Bend office submarket contains 5.8M SF of office space. The submarket posted 69,629 SF of negative net absorption in Q1 2021, down from the 17,898 SF of negative net absorption recorded in Q4. The average vacancy rate increased from 14.5% to 15.7% over the quarter. The average quoted rental rate decreased from $22.14 to $21.90 per SF, and leasing activity increased over the quarter by 22%. There are currently no buildings under construction in the submarket.
Medical Office Highlights
The Fort Bend MOB submarket recorded 10,477 SF of negative net absorption in Q1 2021, a decrease from the 3,751 SF of positive net absorption recorded in the previous quarter. The average quoted rental rate dropped over the quarter from $23.09 to $22.66 per SF. The average vacancy rate increased 60 bps from 15.3% in Q4 2020 to 15.9% in Q1 2021. There are no medical office buildings over 10,000 SF under construction in the submarket.
The Fort Bend/Sugar Land industrial submarket contains 33.4M SF of industrial space and currently has 5.9M SF of available space. The submarket recorded 441,660 SF of positive net absorption during Q4 2020, pushing the year-end 2020 total to 1.2M SF. Vacancy decreased from 9.8% to 8.4% over the quarter, and the average asking NNN rental rate for all property types rose from $8.21 per SF to $8.34 per SF. There are 21 buildings with 2,500,557 SF of industrial space under construction and an additional 3.7M SF of proposed development. The largest building under construction is a 1.1M SF Amazon fulfillment center located in the Fort Bend Business Park.
The Fort Bend retail submarket contains 15.8M SF of retail space and currently has 1.2M SF of available space. The submarket recorded 39,007 SF of positive net absorption in Q1 2021, and the vacancy rate dropped from 7.1% in Q4 2020 to 6.9% in Q1 2021. The average asking rental rate for this retail submarket decreased from $23.78 per SF in Q4 2020 to $22.90 per SF in Q1 2021. Four retail properties totaling 99,148 SF are currently under construction, and an additional 352,638 SF is proposed.