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The Houston industrial market saw another positive quarter in Q3 2020 despite economic pressure from the COVID-19 pandemic and oil prices that remain below the levels of profitability.
Net occupier demand for the quarter totaled 1.4 million square feet (msf), primarily driven by e-commerce retailers, third-party logistics providers, and materials distributors. In line with its historical performance, the Northwest submarket posted the highest levels of net absorption, totaling 1.7 msf, and saw two of the five largest leases for Q3, both of which were in a Prologis-owned development. The lowest level of net absorption, totaling negative 475,000 square feet (sf), was observed in the Southeast submarket, which is home to the Port of Houston and a large concentration of petrochemical manufacturers.