2012 Proves a Strong Year for the Houston CRE Market
Despite the fact the Houston economy mirrored national business conditions and economic expansion decelerated in the 4th quarter, it remains one of the strongest metropolitan economies in the country. 2012 was a strong year for all sectors of the Houston commercial real estate market.
Here is a recap of the office, retail and industrial markets.
Houston Office Report – Year End 2012
Houston’s strong job growth boosted office leasing in 2012. Fourth quarter leasing activity reached 2.4 million SF, pushing the year-end total to over 12.2 million SF. The Houston metropolitan area added 85,300 jobs between November 2011 and November 2012, an annual increase of 3.2% over the prior year’s job growth. Further, Houston’s unemployment fell to 5.8% from 7.3% one year ago, which bolstered annual Houston area home sales by 27.9%. Expansion in the energy industry has driven demand for new office development as tenants find it harder to locate blocks of quality office space. Currently, over 4.2 million SF of office space is under construction and approximately 50.0% of it is pre-leased … view the entire report
Houston Retail Report – Year End 2012
Houston’s retail market posted 1.1M square feet of positive net absorption in Q4, bringing the year-end 2012 total to 1.2M SF. The opening of Phase 1 of the Tanger Outlet Center in Texas City, as well as the opening of the new HEB in Cypress, contributed over 534,000 SF to the fourth quarter’s positive net absorption. Other tenants that moved during the fourth quarter include American Girl, Wellborne Cinema, Bone Daddy’s and Serious Cigars… view the entire report
Houston Industrial Report – Year End 2012
Houston’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 … view the entire report