Houston Construction Levels Differ By Industry

Development of new Houston office space is at its lowest in years. At the same time, industrial space is seeing growing demand

Many Houston offices remain empty as a result of the oil downturn.


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In the second quarter of 2018, office construction in Greater Houston slowed down to about 1.5 million square feet, the lowest level since 2010.

Since the oil downturn, vacancy levels have risen for 14 consecutive quarters.

That's according to commercial real estate firm JLL.

In the industrial sector, things look much better. Here, construction activity has increased for four straight quarters with a vacancy rate below five percent.

So for the Houston economy, does the positive industrial market make up for the shortcomings in office?

Not really, said JLL's Steve Burkett, because office buildings take longer to develop.

"Industrial can react more quickly than office can," he said. "And so the office market, if it slows down, it takes a lot longer to ramp back up."

The office market is largely dependent on the still recovering oil and gas industry.

Tenants in the industrial market are more likely retail and consumer-focused.


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Florian Martin

Florian Martin

Business Reporter

Florian Martin is the News 88.7 business reporter and also covers criminal justice, guns and shootings.Florian's stories can frequently be heard on other public radio stations throughout Texas and on NPR nationwide. Some of them have earned him awards from Texas AP Broadcasters, the Houston Press Club, National Association of...

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