Houston 2012 Industrial Absorption – 6.2M SF

by CoyDavidson on January 21, 2013

Houston Industrial Market Report – 4Q 2012

industrial thumbnailHouston’s industrial market remains one of the ten healthiest U.S. industrial markets because of its low vacancy, stable rental rates and positive absorption. Houston posted 1.4M SF of positive net absorption in the fourth quarter, pushing the year-end total to 6.2M SF. Leasing activity reached 3.3M SF in the fourth quarter, pushing the year-to-date total to 13.2M SF. Houston’s average industrial vacancy rate decreased from 5.3% to 5.2% in the between quarters. Due to the large amount of new inventory deliveries, Houston’s industrial vacancy only decreased 1% between quarters despite the significant positive absorption. The overall average quoted industrial rental rate increased from $5.51 to $5.59 per SF NNN between quarters, and increased by 2.6% on a year-over-year basis from $5.45 per SF NNN at the end of 2011.

Houston’s lack of available industrial inventory has spurred demand for new product. Developers have responded and currently have over 2.5M SF under construction. Much of the increased activity has been driven by build-to-suit projects for companies expanding in or relocating to the Houston market, however, there are now more spec developments (1.9M SF) than build-to-suit projects. As Houston’s available industrial inventory shrinks, we believe the increasing demand for new product will continue to spur both build-to-suit and spec development.

Please click here to access the full Q4 Houston Industrial Market Research & Forecast Report.

Houston Industrial Market Report 4Q 2012 by Coy Davidson

Previous post:

Next post:

Disclaimer: All blog entries on this site are the opinion of the author and not those of either Colliers International - Houston or Colliers International (collectively, "Colliers"). Colliers neither endorses, sponsors nor necessary shares the opinions of the author, regardless of whether any blog is posted by any employee, officer, agent, or representative of Colliers. Colliers has not authorized or verified any statement of fact made in a blog, and any such statement does not constitute a statement of fact by Colliers. Colliers is not responsible for the monitoring or filtering of any blog, nor does Colliers claim ownership or control over any blog content.