How Houston Office Stacks Up Against North America
Colliers compared major North American metro office markets against each other. Here's how Houston ranks.
No. 1
Houston blew away the competition in the race to absorb space, with 2.2M SF soaked up in the final quarter of the year. The next closest metro was St. Louis, with 1.3M SF. Looking at CBD absorption alone, Houston ranked fourth with 439k SF. (New York’s Midtown South Manhattan took top honors with 929k SF.) Our suburban absorption made up the difference—we’re top of that list with 1.7M SF absorbed in Q4.
No. 1
It’s no surprise Houston led the continent in total 2014 absorption. We leased up 6.8M SF (a record) compared to 5M SF of absorption from runner-up Dallas. Breaking it down, Houston was 10th in CBD absorption for the year (814k SF) and first in total suburban absorption (6M SF). Manhattan dominated the CBD list, stealing the top two spots. (Downtown Manhattan soaked up 4.2M SF last year, and Midtown South Manhattan absorbed 3M SF.)
Unranked
At 11.5%, Houston’s overall vacancy rate didn’t make the top 10. Bakersfield, CA (pictured, it’s 100 miles outside of Los Angeles and the ninth-largest city in the state) took top honors with 6.2%. Toronto holds the second spot, with 7.3% vacancy. (That’s largely thanks to its strong Downtown—it leads North America in CBD vacancy, posting 4.5% in Q4.)
No. 5
Downtown Class-A rents grew 10.1% from Q4 2013 to Q4 2014, bringing Houston to $42.01. Leading the list was San Francisco, whose 18.4% growth culminated in $62 rents.
Unranked
The biggest suburban rent mover was Pittsburgh, where rates increased 23.1% to $26.89. Houston’s rates barely rose in the 'burbs, from $30.80 in Q4 '13 to $31.61 in Q4 '14.
No. 1
Houston added the most office space last year of any North American city: 6.7M SF. In second place is Washington, DC, which delivered 4.2M SF. Toronto made a run for the money though, with the most new supply in Q4: 1.7M SF. (Houston was second on that list, with 1.6M SF.)
No. 1
We’re on track to have the most supply in 2015, too—in Q4, we had 17M SF under construction. That’s double the next closest metro. (San Jose/Silicon Valley had 8.1M SF in the dirt.) That’s almost entirely suburban projects, so it’s no surprise we didn’t make an appearance on the CBD construction list (San Francisco is No. 1 with 5.2M SF underway Downtown) but topped the suburban list.
