Houston Office Market Report
Energy Corridor Witnesses Stronger Demand; Overall Market Recovery Advances Slowly
Leasing activity ramps up in the Energy Corridor. From April through June of this year, the Katy Freeway submarket led the metro with 162,000 square feet of net absorption. The corridor faced significant hurdles early in the pandemic as uncertainty within the energy industry suppressed demand, so the change of momentum in the second quarter is a positive sign. Floor plans in the 10,000-square-foot to 30,000-square-foot range were favored by corporations seeking offices here. Energy industry firms that have committed to space in the Katy Freeway submarket in 2021 include AES Drilling Fluids, Wildfire Energy, Pemex and Liberty Oilfield Services. Nonetheless, vacancy here rested at 24.5 percent in June, up 350 basis points year over year. The local average asking rent also fell 6.6 percent during that span.