HOUSTON-During the first half of this year, 478,093 square feet of retail was absorbed, according to mid-year data provided by CBRE. This represents a significant improvement compared to 2010 when mid-year absorption posted at negative 858,369 square feet.
During the second quarter alone, the market recorded 388,507 square feet of absorption, according to CBRE. The marketwide vacancy rate was relatively unchanged at 8.1% at mid-year. The lowest vacancy rates were found in the Near West submarket (2.6%), which includes prime retail locations such as the Galleria, Uptown Park, Memorial and City Centre.
“Houston, and Texas in general, has taken on quite a bit of population, and retailers are positioning themselves to take advantage of that growth,” says Steve Ash, a managing senior vice president with Transwestern, which recently formed a strategic partnership with Page Partners to create Transwestern Page Retail Management LLC. The new management company focuses on institutional-quality retail projects and expanding retail leasing opportunities in Houston.
From 2000 to 2010, the region’s population grew 7.4% to 2.09 million. The metro area is in a race with Chicago to become the third largest city in the US, according to the US Census Bureau.
The strong population growth can be attributed to Houston’s continued economic strength and job creation. In fact, the Dallas Federal Reserve says the region’s economy has bounced back to pre-recession levels. According to estimates released by the Texas Workforce Commission, Houston gained 45,000 jobs from May 2010 to May 2011.
As the Houston metro area continues to grow, demand for goods and services has increased, and retailers have responded. “Retailers, particularly national retailers, are back in action,” Ash tells GlobeSt.com.
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