Sublet leasing activity considerably lower than a year ago

Houston’s office market is making some progress in reducing the amount of sublease space that was placed on the market in the height of the energy crisis. Although sublease space has decreasedQ2 2018 Houston Office Sublease Market Indicators over the past few years, additional blocks of sublease space recently placed on the market have curtailed the downward momentum in 2018. The majority of individual blocks of sublease space currently on the market have 1-3 years of term remaining; however, there are still some large blocks of space with 5+ years of remaining term.

Vacancy & Availability

  • Q2 2018 sublease vacancy rate is 2.5%
  • Q2 2018 total available sublease rate is 4.3%

Rental Rates

  • Houston’s average gross sublease rental rate is $22.80 per SF
  • Houston’s average net sublease rental rate is $14.67 per SF

Net Absorption

Q2 2018 sublease net absorption is 914,668 SF and when combined with the negative net absorption from Q1 2018 the 2018 year-to-date net absorption total is 326,078 SF

Leasing Activity

Sublet leasing activity dropped 28.4% over the quarter from 372,803 SF to 266,863 SF

Available Sublease Space

Current cycle available sublet space increased slightly in Q2 2018

Q2 2018 Houston Office Sublease Space Graph

Q2 2018 Houston Office Sublease Front page screenshot

 

 

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Q2_2018_Houston_Office_Average Prices