Houston’s industrial buildings are getting bigger
The Houston industrial development market has experienced a dramatic shift in building size over the past five years. The average size of new industrial projects has surged 66.7%, climbing from 142k sf in Q1 2019 to 237k sf by the end of 2024. This surge reflects the market's rapid response to the pandemic-driven spike in consumer demand and logistics growth.
Although new construction briefly slowed in early 2021, the average size of these new industrial buildings increased substantially, peaking at 264k sf. This peak was driven by five massive projects underway, each exceeding one msf during this period of high demand. Several large occupiers completed built-to-suit deals in 2021-2022, with companies like Amazon, Lowe’s, Floor & Décor, and Walmart each building over 1 msf.
Despite this massive growth in supply, the market has maintained a strong pace of absorption. Prior to the pandemic, the market experienced approximately 11.4 msf of net absorption per year. However, the last five years have seen exponential growth, averaging around 26 msf per year.