Latest Quarterly Snapshot

The Houston retail market continued to perform steadily in 3Q25, supported by ongoing population growth and consistent consumer activity. Vacancy remained in the mid-5% range, signaling balanced supply and demand, while net absorption exceeded 800,000 SF for the quarter. New construction deliveries slowed to approximately 700,000 SF and the development pipeline contracted, helping preserve occupancy and mitigate oversupply concerns. Asking rents held firm on average at $24 pSF NNN throughout the Houston region, with modern, well-located centers commanding premium rates. Overall, Houston's retail sector remains well-positioned, driven by strong leasing momentum, disciplined development, and resilient consumer fundamentals.

Houston's industrial market remained one of the nation's most dynamic in 3Q25, with steady leasing activity and 10.9 million SF absorbed during the quarter. The metro's inventory now totals roughly 838 million SF across more than 20,000 buildings. However, new supply has consistently outpaced demand over the past three quarters, a trend expected to continue into 2026. This has led to modest upward pressure on vacancy, which currently stands at 7.4%. Even with this gradual softening, Houston's industrial fundamentals remain sound, supported by strong tenant demand and long-term economic growth drivers.

Houston's office market remained one of the nation's strongest in 3Q25, ranking among only three major U.S. metros with positive absorption year-to-date. Construction activity is limited, with just 2.3 million SF underway, about 80% preleased, primarily for build-to-suit and medical office projects in north and west Houston. This lack of new supply is helping stabilize fundamentals, keeping vacancy near 19.8% and average asking rents above $30 pSF. With few groundbreakings and steady demand for high-quality space, Houston's office sector is positioned for continued gradual improvement into 2026.