The Woodlands office submarket continues to be Houston’s bright spot
The Woodlands office submarket continues to outperform its peer submarkets, posting 128,164 SF of positive net absorption in Q2 2019, bringing the year-to-date total to 542,628 SF. Half of Q2 absorption was due to Med-Data’s move into 50,000 SF in the Havenwood Office Park.
The Woodlands average vacancy rate decreased 130 basis points over the quarter from 9.2% in Q1 2019 to 7.9%. This is the lowest vacancy rate among the submarkets that compete with The Woodlands. Although The Woodlands office market is extremely healthy, there is concern regarding The Woodlands largest tenant Anadarko and Occidental Petroleum's announced acquisition of the company since they have over 2,000 employees in The Woodlands. Anadarko owns two class A office towers which contain close to 1.3 million SF. In the meantime, The Woodlands office submarket is the bright spot in Houston’s struggling office market.
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs below are only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph..