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Houston Office Vacancy Tapers for First Time in Two Years

HOUSTON-Grubb & Ellis pegs vacancy at 19.9% overall, with absorption surging in the second quarter. The 515,068-sf gain, though, most likely is tied to declining rents across the board. The good news is select pockets are starting to see rents go up.

By Jennifer Brenner Andrade | Updated on July 08, 2004

HOUSTON-A second-quarter office report, now making its way to the streets, shows some good traction was made in the Greater Houston area, with 515,068 sf of positive absorption in 12 of the city’s 19 submarkets. Sweeter still, the office vacancy declines for the first time in 2.5 years.

“With the economy slowly recovering, businesses are finally starting to make decisions,” says Ariel Guerrero, research services manager in Houston for Grubb & Ellis Co. Those decisions translated into 211,744 sf of positive absorption in the Uptown/Galleria submarket and 139,131 of black ink in the CBD.

Overall vacancy dipped to 19.9%, down 0.10% in three months in an inventory of 154 million sf. In the CBD, the quarter ended with a 21% vacancy or 7.5 million sf of empty space versus a first-quarter close of almost 21.5%. The suburbs’ overall vacancy was 19.5%, a 0.2% drop.

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