NAI Partners: A Mixed Bag for Houston Commercial Real Estate

Continued high office vacancy rates, combined with booming retail and an industrial sector reporting more than 95% occupancy were the prime highlights within the Houston commercial real estate sector. Experts with NAI Partners in Houston shared insights during the company’s Q1 2018 press breakfast.

Though office leasing activity has been active in the sub-20,000-square-foot range (according to Jim Tainter), Griff Bandy pointed out that “overall vacancy remains at elevated levels.” The end result is an increase in tenant improvement requests,” with some landlords more motivated to meet certain concessions than others,” Bandy said.

On the retail side, Jason Gaines indicated that long-term-held assets are catching the interest of non-institutional investors. On the one hand, he said, “entities tend to be nimbler when it comes to getting things done.” However, there can be less of an incentive for those new owners to “meet prospective tenants in the middle, on certain aspects of the negotiation process,” Gaines said. John Simons commented on industrial, noting that construction is balanced, and is heading more toward speculative development.

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