2024 News Archive

The Houston Industrial market consistently grapples with a supply and demand imbalance, as evidenced by 1Q24 where 6 million SF of new product outpaced the absorption rate by 60%, which stood at 2.4 million SF. With 16 million SF still under construction, the supply wave shows no signs of waning, with nearly 70% of it available for lease. Despite the significant outpacing of absorption by new product, the slowdown in new construction starts is projected to mitigate reduced absorption, fostering a more sustainable and balanced market outlook. Vacancy levels are anticipated to stabilize as a result. Even still, the industrial market remains one of Houstona€™s best performing product types.

The Houston Industrial market continues to outperform other U.S. markets primarily due to high tenant demand. In 4Q23, the demand for industrial space in Houston increased quickly, reaching 10.2 million SF of transactional leasing activity. This was the highest amount of total space leased in any quarter of 2023, with most of the leases consisting of third-party logistics companies and manufacturers. Furthermore, the market's resilience persists with positive absorption continuing to be a highlight, reaching 4.2 million SF in 4Q23. This trend will more than likely continue throughout 2024, but could be outpaced by supply given the under-construction pipeline.