March 22, 2016
The Houston office market was negatively impacted in 2015 by the decline of oil and gas properties, and the addition of new supply. By the end of last year, the metro’s vacancy rate was 13.5%. A total of 12.1 million square feet was delivered to the market in 2015 – representing 15.1% of total U.S. deliveries.
Will this state of affairs continue into 2016? According to the Kroll Bond Rating Agency (KBRA), continued low oil prices will limit office growth. Even though the metro has some diversification (through its medical district and port), the recently added supply – plus more in the pipeline – will likely mean that the office sector could continue to struggle for the remainder of the year.