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Development pipeline rebounds with expanding speculative activity
The development pipeline throughout the Houston industrial market continues to make a V-shaped recovery into 2026, following a sharp decline in construction activity and a recent rebound, ending Q1 at 22.9 million square feet (msf). More interesting than the recovery underway is the emergence of a more risk-on approach from developers, as speculative development takes a larger share of the pipeline. In Q1 2024, there was nearly 19.0 msf of development underway, of which 66.0% was speculative. Just two years later, speculative development makes up 78.0% of projects currently under construction. One of the largest quarterly groundbreakings was in the Northwest submarket, where Phase 2 of Transwestern’s Innerbelt Northwest Logistics Park commenced construction across four buildings totaling close to 1.4 msf and is set to complete by end of year.