Q1 2024 Houston Office Market Report

The Houston office market continued to soften to start the year, with ongoing economic uncertainty and evolving work trends contributing to muted leasing activity. Better than expected job growth in 2023 has not fueled a noticeable uptick in demand. Despite the Houston metro having one of the highest return-to-office rates in the country, many occupiers are prioritizing reducing their footprints and utilizing the savings to relocate to newer, better amenitized buildings. But, with the office development pipeline drying up, availability in higher-end inventory is quickly tightening.

Leasing activity has been focused on the west side, highlighted by recent large commitments by Dow Chemical, Fluor and Noble Drilling. The Houston office market should remain firmly occupier friendly in the near term with landlords facing mounting pressure and competition to backfill space, particularly in older assets.

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