Downtown Houston Market Report
Q1 2019 Downtown Houston Market Report Q1 KEY HIGHLIGHTS 5 new retailers added in Q1 MassChallenge Press Conference Downtown concluded the first quarter of 2019 with sound fundamentals, and a slew of office leases, renovations, and new construction activity, thanks to improving indus- try trends. Rebounding from its plunge at the end of last year, WTI crude increased steadily throughout the first quarter, settling at $61 per barrel at the end of March (a 40 percent increase over a 3-month period). Despite looming uncertainty as geo- political tensions weigh on global and national demand outlook, the Downtown and Houston economy continue to experience robust labor market and economic growth, albeit lower than initially forecasted. Houston unemployment is at its lowest in two decades (3.7 percent in March 2019), supported by strong manufacturing employ- ment. Stable oil prices are likely to translate to increased production, but less so to energy sector job growth, due to the growing technological efficiencies in the indus- try. In the midst of this, the Downtown market is bustling, as developers and landlords continue to implement innovative offerings and experiences for employees, residents and visitors. Cranes continue to dot the Downtown skyline, as a plethora of new and redevelopment projects are underway in all of Downtown’s major submarkets—office, multifamily, hospitality and retail. Downtown Houston Market Report Q1 2019 1 Q1 2019 in Review BUILDING YEAR Kinder Morgan Tower 2011 601 Travis 2011 (CONTINUED) SUMMARY 919 Milam 2012 On the office front, according to CBRE, top leasing trans- Pennzoil Place 2013 actions in the region in Q1 2019 were 36 percent more 811 Louisiana/Two Shell 2015 square feet than in Q1 2018; and of this, 31 percent of the leasing activity was concentrated in Downtown.1 1001 McKinney 2015 Downtown recorded over 774,000-SF in leasing activ- Esperson 2016 ity, of which 238,000-SF were signed by firms new to Downtown, and three leases were over 100,000- 1000 Main 2016 SF (Direct Energy, Calpine, Hunton Andrews Kurth).
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