Houston Medical Office Market | Year-End 2012
Houston medical office buildings recorded 249,533 SF of positive net absorption in the second half of 2012, pushing year-end 2012 net absorption to 984,525 SF. By property class, Class A posted the largest amount of year-end positive net absorption with 771,903 SF, followed by Class B properties posting 244,875 SF of positive net absorption. Since mid-year, the citywide average vacancy rate decreased 10 basis points and the average quoted rental rate increased slightly from $23.11 to $23.17 per SF.
Houston’s medical office market is expected to benefit from both short- and long-term regional trends. Disciplined development, with only 9 new buildings added to inventory in 12 months, will relieve the pressure in filling the existing vacant lease space.
Overall, Houston’s economy remains among the strongest in the U.S. Houston area home sales increased by 17.4% compared to sales one year ago. The Houston metropolitan area added 85,000 jobs between November 2011 and November 2012, an increase of 3.2%, and is on track to add the same amount in 2013. Unemployment fell to 5.8% from 7.3% one year ago.
Please click here to access the full Year-End 2012 Houston Medical Office Healthcare Market Commentary.