Coy Davidson, vice president of the Houston office of Colliers International, tells GlobeSt.com that Houston fared well especially when compared to the rest of the country. Davidson warns, however, the drag created by 4.2 million of sublease space will likely hold down lease rates for direct space and keep rental rates flat.

At the end of Q4 2001, the weighted average rate for class A space in the CBD was $25.91 per sf and $20.62 per sf in the suburbs. Among all classes, the rated average in the city is $16.22 per sf.

Davidson says the effects of Enron's collapse have yet to make their way into the numbers, but the public relations impact on Houston's office market future has been considerable with real effects to come. "The effect of the Enron bankruptcy is going to be felt throughout our city's economy. We will see an increased number of homes for sale in some our more expensive neighborhoods; an increased availability of recreational properties for sale; and we will feel it in the office market," says Robert S. Parsley, CEO of Colliers International.

Other highlights from the report show a CBD vacancy of 7.29% and a suburban rate of 15.71%. In all, vacancy is standing at 14.43%. The numbers are extrapolated from a total of 1,512 buildings totaling more than 187.8 million sf.