Houston Retail Market Report | Quarter 2 2022

HOUSTON - Rezul -- Key Takeaways

• Vacancy continues to decrease
• Positive absorption recorded
• Rental rates increased 2.0% annually
• 2022 leasing activity up 24% annually

Houston Highlights

Houston's vacancy rate decreased 50 basis points from 5.6% to 5.1% over the quarter as more inventory was leased than new inventory delivered. Houston's retail sector recorded 1.3 million square feet of positive net absorption in the second quarter, pushing the year-to-date total absorption to 2.4 million square feet. Year-to-date leasing activity reached 3.1 million square feet, an increase of 24% when compared to mid-year 2021. The average asking rental rate increased 2.0% on an annual basis.

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Executive Summary

Commentary by Patrick Duffy, MCR

The Consumer is Still Consuming – Retail Holding On

Despite recent readings of consumer confidence dipping to the lowest level in seven years and a 40-year high inflation environment, the U.S. consumer is still buying. Retail sales (excluding food services) nationally hit a record high of $594B in June (unadjusted for inflation). That represents an increase of 7.7% over last year, which is below the reported CPI increase of over 8.5%. Our take-away is that the consumer is buying roughly the same amount of goods, but the goods cost more...Read the full report here: https://www.colliers.com/en/research/houston/q2-2022-houston-retail