Second Quarter 2010 Office Market Report

NAI Houston Office Report | Second Quarter 2010: Recap

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Houston: Office Space Data

CITYWIDE HIGHPOINTS: (Updated from 1st Quarter 2010) A. Net absorption for Houston office space citywide: -311,935 SF in Q2 2010, +505,004 SF in Q1 2010, +105,274 SF in

Q4 2009 and +84,514 SF in Q3 2009. B. Vacancy Rate to end 2Q 2010 was 14.2% (up from 1st Quarter 2010). C. Available sublease space to end 2Q 2010 was 4,576,879 SF (up 265,580 from 1st Quarter 2010). D. Rental Rate average ended 2Q 2010 at $23.07 per square foot (a slight decrease from previous quarter). E. 5 new office buildings totaling 78,828 square feet delivered to market to end 2Q 2010. F. Going into 3Q 2010, there was slightly more than 2.33 million square feet of new office buildings under construction. G. Sales of Office Buildings was up compared to 2009. There were 6 office sales transactions during 1Q 2010 with a total

volume of $112,350. The average price per square foot was $147.43.



Source: CoStar Property®

U.S. VACANCY COMPARISON

TRENDS: Vacancy Rate Net Absorption Construction Asking Rents

Houston: Office Space Data



Total Employment Growth Highlight Total Number of Jobs Added Per Year

Recent Deliveries (Houston, TX) Leased & Un-Leased SF in Deliveries Since 2006


NAI Houston Office Report | Second Quarter 2010

Submarket Reports


Absorption (Net) The change in occupied space in a given time period. Available Square Footage Net rentable area considered available for lease; excludes sublease space. Average Asking Rental Rate Rental rate as quoted from each building’s owner/management company. For office space, a full service rate was requested; for retail, a triple net rate requested; for industrial, a NN basis. Building Class Class A Product is office space of steel and con-crete construction, built after 1980, quality ten-ants, excellent amenities & premium rates. Class B product is office space built after 1980, fair to good finishes & wide range of tenants. Direct Vacancy Space currently available for lease directly with the landlord or building owner. Market Size Includes all existing and under construction office buildings (office, office condo, office loft, office medical, all classes and all sizes, both multi-tenant and single-tenant, including owner-occupied buildings) within each market. Overall Vacancy All physically unoccupied lease space, either di-rect or sublease. SF/PSF Square foot/per square foot, used as a unit of measurement. Sublease Arrangement in which a tenant leases rental prop-erty to another, and the tenant becomes the land-lord to the subtenant. Sublease Space Total square footage being marketed for lease by the tenant. Sublease Vacancy Space currently available in the market for sub-lease with an existing tenant within a building act-ing as the landlord. Source: CoStar Property

Downtown 5.3 million SF vacant 11.6% vacancy rate

$29.79 SF/YR avg. rental

West Loop 2.0 million SF vacant 13.4% vacancy rate


Greenway Plaza 1.7 million SF vacant 14.0% vacancy rate


The information contained herein has been given to us by sources we deem reliable. We have no reason to doubt its accuracy, however, we do not make any guarantees. All information should be verified before relying thereon.

NAI Houston Methodology / Definitions / Submarket Map

Second Quarter 2010 Office Market Report

Real Estate

Transcript of Second Quarter 2010 Office Market Report