HOUSTON—Since the fourth quarter of 2014, the office market has been characterized by rising vacancy rates, flattening asking rents, growing concession packages and a glut of sublease space. The phenomenon of 12 to 15 months of free rent on a 10-year deal is not uncommon for class-A space as well as tenant improvement allowances at more than $50 per square foot.

While vacancy rates and asking rents maintained these trajectories through the first quarter of 2018, concessions appear to be leveling off as more tenants engage the market to take advantage of favorable lease terms. Concessions will begin to fade particularly as the development pipeline tapers off, sublease space is absorbed and the newest, most efficient space is leased. To put it succinctly, concessions are about as good as they are going to get, according to JLL's first quarter office market insights.

“The story of the office market has been very consistent for the last several quarters: increasing vacancy, sublease space and concessions,” Beau Bellow, JLL senior vice president, office tenant representation, tells GlobeSt.com. “However, despite an uptick in vacancy and some new sublease space put on the market, concessions seem to be leveling off and a bit of cautious optimism has returned. Opportunities still abound for tenants in the market, but the level of concessions we have grown accustomed to won't last forever.”