Avison Young releases First Quarter 2024 Industrial Market Report for Houston

Avison Young releases First Quarter 2024 Industrial Market Report for Houston April 16, 2024

Houston, TX – Avison Young today released its First Quarter 2024 Houston Industrial Market Report. The Houston industrial market showed continued resilience in Q1 2024, with net absorption surpassing 3.2 million square feet (msf). While demand has moderated from its post pandemic peak, it remains healthy and sits slightly above the pre pandemic average (2016-2019).

Construction activity is currently at its lowest point since 2016, with just 985,000 sf breaking ground in Q1 2024 compared to the pre-pandemic average of 4.2 msf per quarter. This dramatic slowdown, coupled with completions exceeding starts, has reduced the development pipeline. However, this decline signals a healthier market in the long-run, as the pace of construction is returning to more sustainable levels.
“After the industrial construction boom in 2022, we are now seeing the pipeline stabilize to adjust to meet long-term demand,” said Drew Coupe, Principal and industrial tenant representation specialist with Avison Young.

While construction activity has slowed, a substantial 5.6 msf of new product has come online, adding to the record-breaking volume delivered in 2023. This influx has pushed vacancy rates up, 190 basis points higher year-over-year and 30 basis points above the prior quarter. However, the new space that has been delivered since the beginning of 2023 is still in lease-up. While market activity has normalized, occupier demand remains robust, with expectations that occupancy will eventually catch up, albeit at a slower pace.

Avison Young creates real economic, social and environmental value as a global real estate advisor, powered by people. As a private company, our clients collaborate with an empowered partner who is invested in their success. Our integrated talent realizes the full potential of real estate by using global intelligence platforms that provide clients with insights and advantage. Together, we can create healthy, productive workplaces for employees, cities that are centers for prosperity for their citizens, and built spaces and places that create a net benefit to the economy, the environment and the community.

Avison Young is a 2023 winner of the Canada's Best Managed Companies Platinum Club designation, having retained its Best Managed designation for 12 consecutive years.


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