Houston market observes uptick in leasing activity, but downsizings and rightsizings of space continues

Following a weak start to the year, third quarter transaction volumes across the Houston office market rebounded to their best performance since the start of the pandemic. Nearly 3.8 million square feet (msf) was leased this period, a tally that was more in line with pre-pandemic averages. Nearly three-quarters of all deals by square footage were executed in Class A properties, continuing the trend of tenant flight to quality into the market’s newest and best stock. However, several deals this quarter included companies rightsizing and downsizing from their previous occupancies. Among them, Bechtel’s 205,000-square-foot relocation to 2105 CityWest Boulevard was a 53% percent reduction from its previous occupancy at 3000 Post Oak Boulevard. To a greater degree, Baker Hughes is consolidating by approximately 346,000 square feet (sf) at its new 130,000-sf location at 575 N Dairy Ashford Road.

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