Office building vacancies on the rise throughout Houston

Office building vacancies on the rise throughout HoustonOffice space vacancy rates have risen in the wake of the oil and gas slowdown that began in 2014, with more than 22 million square feet of space available across the Greater Houston area, and industry experts say recovery is not around the corner.

“Just as job growth goes to zero and population growth slowed down, we decided to deliver 22 million square feet of office space inventory,” said Bill Gilmer, director of the Institute for Regional Forecasting at the University of Houston’s Bauer College of Business.

The Greater Houston Partnership estimates at least three to five years are needed for the market to recover.

“The office market tends to be cyclical,” said Patrick Jankowski, vice president of research at Greater Houston Partnership.  “We go through periods where we overbuild and then recover. The big story right now is sublease space.”

About 12 million square feet of the available space in the Greater Houston area is sublease office space, which is leased by the tenant. That figure should be closer to 3 million square feet, Jankowski said.

Gilmer said the problem is not weak demand for office space but an overabundance created in response to a booming economy that slackened in the oil and gas sector.

In areas of Spring and Klein such as the FM 1960 corridor, a mix of smaller businesses not dependent on the oil and gas industry has allowed the office space leasing market to weather the storm better than Houston’s I-10 energy corridor.

“In general, we didn’t take as hard of a hit with the oil and gas market declining,” said Sam Carrion, a leasing representative for Houston-based Boxer Properties, which leases properties in Spring and Klein. “We did take some minor drops in some tenants that were in oil and gas businesses that ended up closing their doors.”

Tax services, law offices and insurance agencies have helped make up the losses in the oil and gas sectors, he said.

Big companies have not been moving into Spring and Klein aside from the Springwoods Village community near the Grand Parkway and I-45, said Todd Edmonds, a principal at The Woodlands-based real estate company Colliers International.

“The lack of an incorporated area has been one of the hardest things to overcome because there’s no one single voice or brand,” Edwards said.

Recovery in the upstream oil business—which includes “white collar” office jobs—will translate to recovery in the office-space market, because other sectors of the economy, including retail and medical office space, continue to thrive, Gilmer said.

“Everything else has been working just fine,” he said. “The U.S. economy has been growing, and that is what has saved us from serious downturn.”

By Vanessa Holt
A resident of the Houston area since 2011, Vanessa began working in community journalism in her home state of New Jersey in 1996. She joined Community Impact Newspaper in 2016 as a reporter for the Spring/Klein edition and became editor of that paper in March 2017 and editor of The Woodlands edition in January 2019.


Spring ISD will continue to offer its curbside meal service, which began in mid-March when campuses closed due to COVID-19, through its Summer Feeding Program, which launched June 3. (Courtesy Adobe Stock)
Spring ISD to offer summer meals at 7 locations

Through the program, children in the SISD area who are age 18 and younger can pick up snacks and lunches for Monday through Tuesday on Mondays and for Wednesday through Friday on Wednesdays.

In preparation for the 2020-21 school year, Klein ISD launched an online survey June 3 to gather input from employees, parents, students and KISD community members on how to proceed with reopening the district. (Courtesy Adobe Stock)
Klein ISD launches online survey to gather input on 2020-21 school year

The deadline to fill out the three-question survey is June 9 at 5 p.m.

Star Cinema Grill has several locations throughout the Houston area. (Courtesy Star Cinema Grill)
Houston-based Star Cinema Grill prepares to reopen all locations

The Houston-based theater chain plans to open all locations by mid-July.

Total cases have risen to 13,268 in Harris County, 7,812 of which are considered active while 5,215 are confirmed to have recovered. A total of 241 people are confirmed to have died from the coronavirus in the county.(Community Impact staff)
Harris County coronavirus count: 241 new cases, 5 deaths confirmed June 3

Meanwhile, Texas Gov. Greg Abbott said 45% of new cases statewide between May 26 and June 2 can be tied to prisons, jails, meat packing plants or nursing homes.

Texas Gov. Greg Abbott announced Phase 3 of his Open Texas plan June 3. (Brian Rash/Community Impact Newspaper)
Gov. Greg Abbott's June 3 guidelines allow most Texas businesses to operate at 50% capacity

Texas Gov. Greg Abbott continues to lift coronavirus-related business restrictions.

Nasir Malik, Houston chapter of the Ahmadiyya Muslim Community director of public affairs, said the Baitus Samee Mosque has participated in volunteer food drives during the coronavirus pandemic. (Courtesy Houston Tibligh)
Spring, Klein places of worship react to statewide reopenings

Places of worship in the Spring and Klein area are increasing sanitization efforts, encouraging social distancing measures and maintaining virtual options during the coronavirus pandemic.

(Courtesy Adobe Stock)
'Our hearts are heavy': Area churches to hold prayer rally June 5 at Magnolia High School

The rally will be held at 7 p.m. in front of Magnolia High School, located at 14350 FM 1488, Magnolia, calling for healing and unity in the nation.

Participants held fists in the air during a moment of silence at a June 2 protest over the death of George Floyd. (Emma Whalen/Community Impact Newspaper)
Q&A: Criminal justice research expert weighs in on George Floyd protests and the sentiments driving them

"I think the data is clear and convincing that there is a problem. I think that we now have societal consensus of that problem and accepting that data."

Houston Food Bank is looking for more volunteers as it handles increased food distribution during COVID-19. (Courtesy Houston Food Bank)
Houston Food Bank: Volunteers needed now more than ever

The Houston Food Bank is distributing more than double the usual amount of food throughout the community.

America's ER operated a drive-thru testing site in The Woodlands in mid-April, which later moved to WoodsEdge Community Church. (Andy Li/Community Impact Newspaper)
America's ER to move to COVID-19 testing by appointment June 8 at Cypress, Magnolia facilities; large-scale testing site closes June 4

While the drive-thru testing site will close permanently June 4, testing will still be available by appointment beginning June 6 at America's ER facilities in Cypress and Magnolia, officials said in a June 2 statement.

(Adriana Rezal/Community Impact Newspaper)
PHOTOS: Scenes from the downtown Houston march for George Floyd

People of all ages, colors and creeds packed downtown Houston June 2 to march in memory of former Houston resident George Floyd.

As protests over the death of George Floyd continue, the Harris County Public Health Department released a statement asking people to take precautionary measures if they plan to attend a protest. (Community Impact Newspaper staff)
Harris County coronavirus count: County tops 350 new cases for second straight day

As protests over the death of George Floyd continue, the Harris County Public Health Department released a statement asking people to take precautionary measures if they plan to attend a protest.