Healthcare: Vacancies Up, But Demand Also Increasing

Vacant sublease space in healthcare buildings across the Houston metro increased from 98,647 square feet to 113,217 square feet between the first and second quarters of 2017. Furthermore, total medical office occupancy increased from 10.9% at the end of 2016, to 12% by the end of the first half of 2017.

Yet, according to a report from Colliers International, “demand for new medical-office space has resulted in four properties being delivered in the first quarter, and five more delivered in the second quarter of this year.” Additionally, approximately 542,224 square feet of medical office space – outside the Texas Medical Center – is under construction, the report notes.

Many of the construction projects represent efforts by health and hospital systems to move closer to patients. Memorial Hermann recently opened a new hospital in northwest Cypress, while Methodist Hospital expanded in The Woodlands.

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