HOUSTON—Not long ago, the exploration and extraction side of the energy sector, which includes industry leaders such as Halliburton, Schlumberger, Baker Hughes and NOV, were shedding space, laying off workers and slashing capital budgets. Active rig count is back on the rise, but is still less than half of the peak number from September of 2014. Lower oil prices continue to benefit the downstream petrochemical companies that have been enjoying the lower cost of feedstock.

Oil prices held above $50 per barrel in the opening months of the year, but are still well below the threshold for full recovery. However, while Houston's regional economy continues to feel the pinch of lower oil prices, signs of improvement in the industrial market are becoming apparent.

While it is far from a complete turnaround, increased drilling activity has oilfield service companies interested in more space, especially in crane-served buildings that experienced the biggest spike in vacancy during the past two years. The resulting expansion of the petrochemical companies has helped to offset the damage to the industrial market, according to Lee & Associates.

With regard to leasing activity turning around, Prologis Inc. is in a search for a tenant to occupy 18,678 square feet of industrial warehouse space in the Prologis Kirby Center 2 at 9300 S. Point Dr. The industrial space includes a 2,300-square-foot office area, and is located near the Texas Medical Center and NRG Park. In addition to its location located off Kirby Drive, it is a front load space with access to Interstate Highway 610 South, State Highway 288 and Interstate Highway 45 (Gulf Freeway). Lee & Associates has partnered with Prologis for the tenant search.

“This space is unique because of its proximity to the Texas Medical Center and NRG Park,” said Tim Thomas, director at Lee & Associates–Houston. “The South Main area, where Prologis Kirby Center 1 and 2 are located, has one of the lowest vacancy rates in the city. We don't expect this space to be on the market for long.”

The space has 22-foot clear height, four dock-high doors, one ramp, 30- by 30-foot column spacing and is fully sprinklered.

“Tenants targeted are those in the medical field, such as medical-related suppliers, or those affiliated with various users at NRG Park such as HLSR, Houston Texas, etc.,” Thomas tells GlobeSt.com. “In addition, because of the location of the property, port related supply chain users would find it conveniently located near the Port of Houston and their clients located in Sugar Land, Stafford and Missouri City.”

Prologis

The space has 22-foot clear height, four dock-high doors, one ramp, 30- by 30-foot column spacing and is fully sprinklered.

Instant Insights /

Industrial Slowly Shows Signs of Recovery

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