Houston industrial market shows its resilience with net absorption remaining positive

The Houston industrial market has observed decreasing net absorption for the fourth consecutive quarter. Net absorption for Q1 2024 was at 3.8 million square feet (msf), resulting in a year-overyear decrease of 2.5 msf. While net absorption has continued to decline, it has remained positive and above pre-pandemic averages. In addition, large deals are still being done, with Solar Plus Technologies signing a lease for approximately 567,000 square feet (sf) and United Airlines signing a lease for approximately 509,000 sf. Vacancy saw a quarter-over-quarter increase of 30 basis points (bps) to 7.3%. Vacancy is anticipated to continue to remain high as new spec development is delivered into the market, and absorption continues to slow from historic highs observed in 2021 and 2022.

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