Houston office market sees decrease in leasing activity despite recovery in employment

In the second quarter 2022, quarterly leasing activity in the Houston office market dropped to its lowest level since the start of the COVID-19 pandemic with just 1.8 million square feet (msf) leased in the quarter. This is lower than the previous pandemic low reported in the first quarter 2021 of 1.9 msf, as well as a 12% drop from 2.0 msf reported same period of last year. The Houston office market continues to see highly uneven leasing activity with some submarkets, mainly in West Houston such as West Loop/Galleria, Westchase, and Katy Freeway/Energy Corridor, seeing the trend of tenant flight to quality into newer Class A properties while other submarkets have seen less activity which has caused average asking rents to decrease.

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