The Woodlands Leads Cautiously Optimistic Office Market
Two-thirds (22 of 33) of the submarkets in the metro recorded positive absorption in the fourth quarter with The Woodlands representing the top performer at 602,236 square feet and more leasing to follow.
THE WOODLANDS, TX—Diversification has helped the metro stay the course while energy prices have recovered to a highly profitable range, allowing for anticipated growth from the energy sector. Factor in the nearing pipeline completion to support the Permian Basin and enthusiasm is cautiously optimistic, according to a report by Transwestern.
Leasing is part of that enthusiasm as office space is currently in lease-up at Research Forest Lakeside, a 77-acre mixed-use development on Lake Woodlands. Currently, there are five office buildings comprising approximately 1 million square feet and an additional four office buildings totaling 629,404 square feet slated for future construction.
Research Forest Lakeside offers desirable ingress and egress, walkable restaurant amenities, access to green space and running paths, and scenic views of Lake Woodlands. The variety of space configurations can accommodate companies requiring floorplates up to 60,000 square feet, multitenant smaller floors, office/warehouse flex space or corporate headquarters.
Transwestern Commercial Services has been retained by James and Daniel Warmack to provide leasing services. The team of Eric Anderson, Tyler Garrett and Parker Burkett are leasing the following buildings:
9501 Lakeside Blvd., a two-story flex/traditional office building totaling 60,000 square feet with a 3.9/1,000 parking ratio; 9500 Lakeside Blvd., a six-story traditional office building totaling 360,000 square feet with a 4/1,000 parking ratio; 2465 Technology Forest Blvd., a six-story traditional office building totaling 150,000 square feet with a 3.9/1,000 parking ratio; 2475 Technology Forest Blvd., a 12-story traditional office building totaling 300,000 square feet with a 3.9/1,000 parking ratio; 9709 Lakeside Blvd., a six-story traditional office building totaling 139,404 square feet with a 4.5/1,000 parking ratio; and 2625 Research Forest Dr., a two-story flex/traditional office building totaling 40,000 square feet with a 3.5/1,000 parking ratio.
“The Woodlands office market has continued to prove that it is one of the strongest submarkets in Houston,” Garrett tells GlobeSt.com. “We are privileged to have the opportunity to work alongside the Warmacks at such a pre-eminent development as Research Forest Lakeside and look forward to delivering great results.”
During the fourth quarter, two-thirds (22 of 33) of the submarkets in the metro recorded positive absorption with The Woodlands representing the top performer at 602,236 square feet, according to the Transwestern report. While subsequent fourth quarter office leasing activity did not disappoint, the mid-to-late quarter fall in oil prices (dipping into the high $40s per barrel) in addition to growing concerns over both slowing national and global economies resulted in tempered enthusiasm going from highly optimistic to cautiously optimistic.
Looking forward, Houston’s office market recovery is still highly tied to the performance of the energy sector and prices will need to remain in the mid-to-low $50s to maintain the growth that began late last year. Should prices hold in this profitable range, a solid year is expected, where absorption yields a marketwide net positive status. Additionally, 2019 looks to be a year of major expansion for co-working providers as several operators are in the market for multiple locations across Houston.