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Office Market Hits Seven-Year Low

HOUSTON-The just-published report by O'Connor & Associates pegs overall occupancy at 81.5% in the 156-million-sf inventory. The gloomy news transcends to rent for class A and B product while class C and D buildings corner some rate gains.

By Jennifer Brenner Andrade | Updated on April 23, 2004

HOUSTON-A just-published report by O’Connor & Associates shows the downward push on the office market has continued, ringing up the lowest occupancy in seven years at the first quarter’s close.

The update puts absorption citywide at a negative 642,204 sf in Q1. In the past year, the metro’s submarkets logged nearly four million sf to the red, “the lowest level on record,” O’Connor research team concludes. The CBD was down 134,612 sf.

Richard Zigler, O’Connor’s research director, said in the report that the CBD was one of the brightest spots in the first quarter. ChevronTexaco’s recent purchase of 1500 Louisiana St., a skyscraper intended to be Enron’s headquarters, was a “major step toward finally putting this whole sordid mess behind us,” he said. “The question of who would occupy the near empty building had been something of a parlor game in local real estate circles.”

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