Houston Industrial Market Report
Industrial Demand Stems From Multiple Industries;
Scattered Speculative Development a Hurdle
Diverse tenant demand buoys leasing. Houston industrial space is coveted by several industries, supporting the absorption of at least 9 million square feet in each of the past seven years, a trend set to continue in 2021. Manufacturing demand is strengthening, particularly as the energy sector recovers. Rig counts in the U.S. were up more than 40 percent annually in May, and firms that produce equipment for the sector are growing as well. Logistics demand is steady with FedEx and Dunavant Distribution Group each committed to occupy spaces larger than 500,000 square feet in 2021. Meanwhile, an expanding population underpins retailer absorption as Lowe’s, Rooms to Go and Costway are all taking up 400,000-square-foot-plus facilities this year. Beside this, Amazon will absorb 2.1 million square feet in 2021 across six properties.