HOUSTON-The fifth largest real estate market in the US, Houston saw growth in the energy sector by mid year that, along with increased diversification in the regional economy, has boosted absorption of office space and held vacancy rates at bay, according to data compiled by Delta Associates, Alexandria, VA. About 1.8 million sf was absorbed during the first half of 2000, much the same pace as in 1999, while the vacancy rate stood at 19.7%.

Deliveries amounted to 2.2 million sf, half of which was pre-leased on delivery. Last year, 7.5 million sf was delivered, but only 36% of it was pre-leased, according to Delta.

So far this year, rents have risen at about 2.5%, on an annualized basis, although some submarkets are enjoying double those increases.

Major trends here include increased absorption of class A buildings, which began to go up in 1998 after a 15-year lull. Also, less office space is being erected now than in 1998-99, which has tamped fears of overbuilding.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dig Deeper



Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.