Houston Office Market Report
Office Availability Continuing to Rise as Oil Demand Downturn Reverberates on Office Absorption
Aftereffects of the oil sector downturn lingering. The sudden disruption to oil prices and demand during the pandemic is beleaguering the Houston economy and office absorption, even as energy prices have recovered. Firms including Exxon and Chevron significantly reduced staff in 2020 and various small companies were squeezed out. The impact of the sector’s reshuffling has been evident, with vacant office stock growing 12.5 percent over the past year ended in March. Notably in the Katy Freeway submarket that encompasses the Energy Corridor, vacant office stock ballooned 22.9 percent during the past 12 months. While some momentum is building as mass vaccination underpins expectations for greater travel and a broader energy sector recovery, office fundamentals in the market will be burdened in the near term.