Houston Industrial Real Estate Market Reports | Avison Young US - Houston
Houston industrial real estate market reports
Houston's industrial market expanded significantly in the second quarter of 2023, with nearly 8 million square feet (msf) of new deliveries. This brings the total amount of product underway to 29.7 msf, but developers are beginning to slow construction activity in response to easing occupier demand and some financing challenges. Population increases coupled with elevated shipping activity through the Port of Houston have stimulated growth in both e-commerce and consumer products. Many large retailers and third-party logistics (3PL) companies continue to proceed with growth plans to support robust consumer growth despite lingering global economic uncertainty.
Positive net absorption remains robust
Despite a decline from previous record levels, the Houston industrial market remains strong, with a healthy demand reflected by a positive net absorption of 3.7 msf.
Vacancy rate rises as new product comes online
Although the vacancy rate rose during the quarter, Houston's industrial market fundamentals remain strong, with vacancy still below the peak of 9.0% recorded in early 2021.
Construction pipeline slows down
Construction activity is slowing in response to easing occupier demand and some financing challenges.
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