Houston's availability flattens after seven quarters of increases, leasing keeps pace
Houston's overall availability rate has leveled off at 30.9% after seeing seven consecutive quarters of increases throughout the pandemic. Still, this remains 210 basis points (bps) higher than one year ago and 540 basis points higher than pre-pandemic levels. Average asking rents have seen little fluctuation since the start of the pandemic, now at $29.24 per square foot (psf). Class A asking rents have increased slightly over the pandemic period, now at $33.73 psf as top-tier space remains highly sought after given the ongoing tenant flight to quality. Demand has slowly strengthened throughout 2021 and held pace to end the year with 2.3 million square feet (msf) of activity recorded for the quarter. Notably, over 0.5 msf occurred in the Central Business District (CBD), including a 259,000-sf lease for Shell Oil, which executed a long-term, early renewal at 1000 Main Street. While ending on a higher note than last year, the impact of the Omicron variant is yet to be seen and will be closely watched going into 2022.