HOUSTON (Connect Media) – October 3, 2017 – The Houston office market for Q3 2017 offered a good-news, not-so-good-news scenario. The good news: Investors have been re-entering the market. According to JLL’s statistics, office sales volume increased more than 430%, year over year.
The not-so-good news? Leasing continues to be sluggish.
Though Hurricane Harvey had little, if any, impact on office inventory, “leasing activity remained muted during the third quarter, and failed to surpass its 10-year quarter for the seventh consecutive quarter,” according to JLL’s Office Insight. This led vacancy to increase – again – taping out at 22.8%, while absorption clocked in at -2.4 million.
On the bright side, the market favors tenants. Yet even here, JLL was somewhat pessimistic, pointing out that the majority of tenants in the market are okay with their current space footprints. “This is best evidenced by the market’s paltry average deal size of 4,700 square feet during the quarter,” the report noted.