Page 12 - NBIZ Magazine August 2023

By Danny Rice, Patsy Fretwell, and Paul Dominique

espite a second-quarter slowdown, the industrial market in the Greater Houston MSA remains active and
healthy, with 3.9 million square feet of net absorption and a construction pipeline of more than 29.5 million
Dsquare feet.Vacancy rates are gradually increasing due to the large amount of new supply, but the market
should remain steady and strong, barring any major economic downturn.

Houston Highlights
The industrial market’s activity level slowed during the second quarter with new supply outpacing net absorption. At
midyear, almost twice as much new product has been delivered than absorbed. Developers have decreased the construc-
tion level to 29.5 million square feet after record-level previous quarters. Positive net absorption this quarter was 3.9
million square feet, a 9.3% decrease from the previous quarter, while deliveries increased to 9.5 million square feet with
less than half preleased. The 5.0 million square feet of new vacant product entering the market helped to lift the vacancy
rate to 6.2%. Leasing activity totaled 7.5 million square feet, down from 10.5 million square feet the previous quarter.

12 NBIZ ■ August 2023