2023 News Archive

The Houston Industrial market continues to be among the top three major metro areas in the U.S. for absorption with 21.2 million SF in the last 12 months. Therefore, in 3Q23 the positive net absorption continued to increase while the pace of growth slowed down. This is due to new construction supply outpacing demand. Nevertheless, there is still 23.5 million SF under construction that is scheduled to be delivered by the end of 2023. In the past decade, 196 million SF of space has been added to the market, growing its total inventory by 30%. Therefore, new supply has been a monumental factor in making the Industrial market what it is today.

The Houston Industrial market is beginning to see a reasonable slowdown in new construction due to the amount that was delivered to the market in the past couple of years. As of 2Q23, 3.7% of Houstons current inventory is under construction. In comparison to the national benchmark of 3.2%, Houston has seen record growth. New inventory to the market, totaling 786 million SF as of 2Q23, remains 70% available for lease. Starting in 2024, the number of new construction projects will decrease notably because of higher interest rates and increased labor and material costs.