I suppose at the end of the day everyone is a “homer” to use a sports analogy. I spend a significant amount of time reading any commentary on the national office market and it seems Houston is the Rodney Dangerfield of commercial real estate.
Despite the fact the Houston region has added more jobs than any metropolitan area in the country since the beginning or end of the recession, and as a result the Houston office market has been one of the strongest performers in the United States, it seems in a vast majority of the commentary I read on the national office market, Houston either gets a passing mention or no mention at all. I should note this isn’t the case all of the time, but does this sound familiar, “The office markets in cities with a large concentration of technology firms – such as Boston, San Francisco and Seattle – are doing particularly well.”
While I realize oil and gas may not be as sexy as technology, the fact remains over the last several quarters Houston has been the top performing office market in the U.S. in terms of office demand. While San Francisco has has posted stronger rent growth, rates are appreciating significantly in Houston and construction cranes can be spotted in numerous submarkets around the city.
Over the past three quarters Houston has absorbed over 3.2 million square feet of office space. I do believe that office investors are well aware of what is happening in the Energy Capital of the world and my clients certainly do. However, the business media covering the real estate sector and talking heads around the country don’t seem to be as aware.
There has been some debate lately as to whether technology specifically social media is in a bubble. I am not necessarily in the bubble camp. I don’t believe innovation and demand for new technology is going to diminish, Social Media who knows? I know we will still be extracting oil and gas from the ground and ocean floor for many years. So I am bullish on Houston’s long-term future.
I have been saying for years that the city of Houston needs a good P.R. firm. I guess our city leaders are not paying attention to some unknown tenant rep with a commercial real estate blog. So this “homer” is standing on his soapbox shouting to the blogosphere. Houston Rocks!
Houston Office Market – Historical Net Absorption