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Occupancy is at 94.3% year-to-date mid-way through December, down 10 basis points from this time last year. Of the 3.6 million sq. ft. currently under construction, about 65% of that space has been spoken for.


Market Highlights

Steady retail market. Occupancy is at 94.3% year-to-date mid-way through December, down 10 basis points from this time last year. Of the 3.6 million sq. ft. currently under construction, about 65% of that space has been spoken for. The Houston retail market has recorded 6.2 million sq. ft. of leasing activity—which is comprised of both new leases and renewals—outpacing the year-to-date activity from one year ago by 10%. In addition, the net amount of square feet absorbed stands at 4.5 million, with new supply delivering 5.0 million sq. ft. to the market this year, of which 74% is occupied. The rising average asking rate of renting retail space continues at record highs for Houston at $18.22 per sq. ft. on a triple net basis, up 5.1% from this time in 2018 at $17.34 per sq. ft.

Driverless delivery from Walmart. Nuro, an autonomous vehicle company will start serving Walmart customers in Houston with driverless delivery robots. The company made its first appearance in Houston earlier this year when it teamed up with Kroger. The recent joint venture with Walmart will begin introducing the new service to a closed group of customers in the 77096 (Meyerland area), 77035 (Brays Oaks area) and 77401(Bellaire area) in the coming months. A larger scale rollout is planned for 2020.

Fifth consecutive positive month of home sales. According to the Houston Association of Realtors, November single-family home sales were up 3.6% year-over-year marking a fifth consecutive positive month. On a year-to-date basis, sales are 4.1% ahead of 2018’s record volume. The median price of a single-family home climbed 2.5% to $240,900, while the average price rose 1.1% to $297,831. The 30-year fixed mortgage rate averaged 3.68% during the week ending December 5, a full percentage point lower year-over-year at 4.75%, as stated by Freddie Mac.

 


Leta Wauson
Director of Research
leta.wauson@naipartners.com
tel 713 275 9618

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