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Occupancy holding tight at 94.6%. Houston’s retail market year-to-date occupancy rate has remained steady at a robust 94.6% since the end of March. In addition, the total amount of square feet occupied grew by 1.6 million sq. ft. of positive net absorption, while new supply is level to demand, delivering an equal 1.6 million sq. ft. to the market so far this year. The average asking cost of renting retail space increased to $16.99 per sq. ft. on a triple net basis, up $0.09 from Q1 2018, and the highest rate recorded since NAI Partners began reporting on this data.
Grocery-anchored and other shopping centers hot with investors. According to Real Capital Analytics, annual sales transaction volume totaled $441 million midway through May in the Houston retail market. Private capital has been the most active buyer type for 2018, comprising 81% of Houston’s total sales volume, followed by user/other buyers representing 12%, and cross-border investors covering the majority of the remaining 7%. A recent transaction includes the 80,883-sq.-ft. Westlake Shopping Center in Katy, which sold to Rising Sale Westlake LLC, by VKC Group. The property was 95% occupied at the time of sale by tenants: 24-Hour Fitness, T-Mobile, and Malibu Tan.
H-E-B goes urban in new mixed-use development. A new development, Buffalo Heights District, has broken ground, replacing the Memorial Heights apartment complex. Phase 1 will include apartments, boutique office space, and a 96,000-sq.-ft. H-E-B with second-floor parking. The seven-story development is scheduled for completion in the spring of 2019, and will be located between Heights Boulevard and Studemont, just south of I-10, on Washington Ave.
Director of Research
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