"Projected employment provides no basis for absorption," Sanford Criner, executive vice president with CBRE/Trione & Gordon, said at a recent forecast event in downtown Houston. He says the Greater Houston Partnership is predicting job growth in 2004, but at least 8,600 of those jobs are health-care related. Other arenas that will drive new jobs are hotels, restaurants, construction and wholesale trade. Only 1,500 jobs this year are expected to come from professional and business services, he says, adding it's simply not enough to resurrect an office market with 1.1 million sf of negative absorption, including sublease space.

Without a doubt, the rumored 350,000-sf Citgo move from Oklahoma to downtown Houston would be a major "shot in the arm," Criner says...should it come to fruition. The other hot rumor is that ChevronTexaco is looking to expand by as much as one million sf. The corporation's execs are rumored to be eyeing 1500 Louisiana, the former Enron Center South building. Right now, ChevronTexaco occupies 550,000 sf of class A space in the downtown. The whispered move, Criner says, could amount to just "a space swap."

The suburbs to the west are once again the city's winners. In the last five years, Westchase's annual average absorption was 400,000 sf. Criner says nearly all absorption is taking place in the western suburbs "at the expense of everyone else in the city."