The office market continues to struggle against the impacts of the COVID-19 pandemic

Rezul News/10561724
Q4 2021 | Houston Office Commercial Real Estate Research & Forecast Report

HOUSTON - Rezul -- "The office market continues to struggle against the impacts of the COVID-19 pandemic and government regulations limiting back to workplace participation. The recent SCOTUS ruling against the OSHA vaccination mandate may provide some relief. The fourth quarter showed some life with nearly 200,000 SF of net positive absorption, but we expect 2022 to show little expansion in net occupied office product. High vacancies will continue to press landlord's toward highly competitive offerings."
Patrick Duffy, MCR | President | Houston

Key Takeaways
  • Houston office market records positive net absorption
  • Vacancy rates remain high
  • 2021 leasing activity down 26% from 2020
  • Tenant space improvement construction costs and time to complete increases

Houston Highlights

Houston's office market posted positive net absorption in Q4 2021, recording 196,525 square feet, but ended the year reporting a total of 1.9 million square feet of negative net absorption. Houston's overall average vacancy rate remained at 23.1% over the quarter and the average Class A vacancy rate dropped 10 basis points. Houston's office inventory increased with 509,280 square feet of new inventory added in Q4. There is still 2.9 million SF of office space under construction and most of the new inventory is 55% pre-leased. Kastle Systems Workplace Office Occupancy Barometer places Houston in the number 2 spot just behind Austin for metros with the most tenant building card key swipes at 42.9%, up 19.3% in January from a month ago.

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Executive Summary

Commentary by Sam Hansen | Principal


Almost two years in - The term "new normal" wasn't coined during the Pandemic, but it was routinely bantered around as we all waited to see how the situation was going to end (remember, it was only supposed to last a few weeks or months). Now 21 months in, new behaviors and actions are present, which may... To read the full report, click here: https://www.colliers.com/en/research/houston/q4-2021-houston-office

Contact
Lisa Bridges | Director of Market Research
***@colliers.com


Source: Colliers | Houston
Filed Under: Real Estate

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