Leasing activity remains solid, but some Houston companies shrink occupancies as they adjust workplace strategies

In contrast to most major U.S. markets, Houston exhibited signs of stability, observing a strong close to 2022 as measured by leasing activity. Nearly 3.4 million square feet (msf) was leased this period, marking the second consecutive quarter of above-average volume. While full year 2022 leasing (11.2 msf) was up 30.2% over 2021 (8.6 msf), transaction levels remained 16.0% below 2019 (13.3 msf), prior to the start of the pandemic. Market activity appeared healthy this period, yet many of the largest deals included firms renewing in place or shrinking their overall footprint as they recalibrate hybrid and remote work policies. Apache Corporation inked the largest deal of the quarter, expanding to 328,000 square feet (sf) at Briarlake Plaza. However, Apache's overall Houston office footprint will shrink by half after it vacated more than 525,000 sf at Post Oak Central. Meanwhile, Wood PLC renewed for more than 226,000 sf at 17325 Park Row Road, following its recent decision to scrap its lease totaling 145,000 sf at Ten West Corporate Center II.

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