Download The Woodlands office market sees uptick in leasing activity and

Research Snapshot
THE WOODLANDS | OFFICE
Q4 2016
The Woodlands office market sees uptick in
leasing activity and absorption in Q4 2016
Lisa Bridges Director of Market Research | Houston
The Woodlands’ office market fared better than most of Houston’s office
submarkets, posting the third highest amount of net positive absorption in Q4
2016. The Woodlands’ Q4 2016 office market vacancy rate decreased 50 basis
points over the quarter and by 220 basis points annually.
Market Indicators
Class A
Class B
VACANCY
Leasing activity increased 6.4% over the quarter and 54.6% over the year. Tech
giant HP Inc. preleased 378,000 SF of office space at Springwoods Village,
a 2,000-acre mixed-use community just south of The Woodlands proper.
Construction is scheduled to begin in early 2017 and is expected to be completed
in the third quarter of 2018. Jones & Carter leased 27,000 square feet in Sierra
Pines II and Hughes Landing reported leases totaling nearly 47,000 square feet.
NET ABSORPTION
CONSTRUCTION
RENTAL RATE
NEW SUPPLY
Statistical Summary
INVENTORY
Class # of Bldgs.
SUBLEASE VACANCY VACANCY VACANCY RATE (%)
DIRECT VACANCY
Total (SF)
(SF)
Rate (%)
(SF)
Rate (%)
Total (SF)
Q4-2016
RENTAL
RATE
NET ABSORPTION (SF)
Q3-2016
Q4-2016
AVG ($/SF)
Q3-2016
The Woodlands
A
39
B
70
4,407,883
C
5
328,281
Total
114
10,926,590 1,305,729
12.0%
39,842
0.4% 1,345,571
12.3%
12.8%
49,487
36,452
399,741
9.1%
62,813
1.4%
462,554
10.5%
11.5%
46,507
-18,621
$24.30
17,763
5.4%
0
0.0%
17,763
5.4%
8.6%
10,506
0
$29.98
15,662,754 1,723,233
11.0%
102,655
0.7% 1,825,888
11.7%
12.3%
106,500
17,831
$33.55
149
Lake
Conroe
105
Willis
$36.43
Cleveland
WOODLANDS SUBMARKET MAP
105
Conroe
THE WOODLANDS
HOUSTON
1488
1488
1488
242
Magnolia
321
The Woodlands
242
Tomball
Spring
Waller
Dayton
Kingwood
Hockley
Huffsmith-Kohrville
Cypress
Humble
IAH
Gosling Rd.
d.
ill R
’s M
gan
Gro
hl
da
en
yk
Ku
2920
249
Needham Rd.
Res
ear
ch
For
est
Wo
o
Par dlands
kwa
y
105
149
Atascocita
Lake
Houston
1314
Crosby
Mont Belvieu
Brookshire
Spring Stuebner
Katy
CBD
330
Ship
Channel
Bellaire
Baytown
225
To Houston CBD
Pasadena
Sugar Land
Richmond
La Porte
146
HOU
35
EFD
Pearland
Clear Lake
Galveston
Bay
35
League City
Alvin
Texas
City
Hitchcock
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs
below are only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
$39.00
Class A Vacancy
18.0
16.0
$37.00
14.0
$35.00
12.0
$33.00
10.0
$31.00
8.0
6.0
$29.00
4.0
$27.00
2.0
$25.00
0.0
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
$28.00
Class B Vacancy
16.0
$26.00
14.0
$25.00
12.0
$24.00
10.0
$23.00
8.0
$22.00
6.0
$21.00
$20.00
4.0
$19.00
2.0
$18.00
0.0
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q4 2016
Class A: 225,501 SF or 2.1%
Class A
Class B
Class B: 156,042 SF or 3.5%
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
2
18.0
$27.00
The Woodlands Research Snapshot | Q4 2016 | Office | Colliers International
Absorption and New Supply
Woodlands Class A Office
Net Absorption
New Supply
2,000,000
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
Woodlands Class B Office
Net Absorption
New Supply
200,000
150,000
100,000
50,000
0
-50,000
-100,000
-150,000
FOR MORE INFORMATION
Lisa Bridges
Director of Market Research | Houston
+1 713 830 2125
[email protected]
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
3
Colliers International | The
Market
Woodlands
000 Address,
1790
Hughes Landing
Suite # Blvd., Suite 250
000 Woodlands,
The
Address, Suite
TX 77380
#
+1 713
000830
0004011
0000
colliers.com/<<market>>
colliers.com/thewoodlands
North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Research Snapshot
THE WOODLANDS | OFFICE
Q3 2016
The Woodlands office market not isolated
from Houston’s current market conditions
Lisa Bridges Director of Market Research | Houston
The Woodlands’ office market continues to feel the effects of Houston’s office
market woes. The Woodlands is not isolated from Houston’s current market
conditions, but does fare better than most of Houston’s other office submarkets.
The Woodlands’ Q3 2016 office market vacancy rate increased 100 basis points
over the quarter, but even with this increase its vacancy rate is still lower than
that of the other major Houston office submarkets.
Market Indicators
Class A
Class B
VACANCY
NET ABSORPTION
Leasing activity increased 30.4% over the quarter and 46.3% over the year.
Webber, LLC signed a lease in 1725 Hughes Landing for 46,600 SF. The
company will be moving in April 2017 from its current location at 9303 New
Trails Dr where it occupies nearly 25,000 square feet.
CONSTRUCTION
RENTAL RATE
NEW SUPPLY
Statistical Summary
INVENTORY
Class
SUBLEASE VACANCY VACANCY
DIRECT VACANCY
# of Bldgs. Total (SF)
(SF)
Rate (%)
(SF)
Rate (%)
Total (SF)
VACANCY RATE (%)
NET ABSORPTION
(SF)
Q3-2016
Q3-2016
Q2-2016
RENTAL
RATE
AVG ($/SF)
Q2-2016
The Woodlands
A
39 10,926,590
1,319,578
12.1%
75,480
0.7%
1,395,058
12.8%
11.5%
36,452
10,798
B
70
4,399,318
431,420
9.8%
69,346
1.6%
500,766
11.4%
11.1%
-14,328
-29,786
$24.45
C
4
308,161
25,119
8.2%
0
0.0%
25,119
8.2%
8.2%
0
0
$19.80
113 15,634,069
1,776,117
11.4%
144,826
0.9%
1,920,943
12.3%
11.3%
22,124
-18,988
$32.57
Total
149
Lake
Conroe
105
$37.05
Willis
Cleveland
WOODLANDS SUBMARKET MAP
105
Conroe
THE WOODLANDS
HOUSTON
1488
1488
1488
242
Magnolia
321
The Woodlands
242
Tomball
Spring
Waller
Dayton
Kingwood
Hockley
Huffsmith-Kohrville
Cypress
Humble
IAH
Gosling Rd.
d.
ill R
’s M
gan
Gro
hl
da
en
yk
Ku
2920
249
Needham Rd.
Res
ear
ch
For
est
Wo
o
Par dlands
kwa
y
105
149
Atascocita
Lake
Houston
1314
Crosby
Mont Belvieu
Brookshire
Spring Stuebner
Katy
CBD
330
Ship
Channel
Bellaire
Baytown
225
To Houston CBD
Pasadena
Sugar Land
Richmond
La Porte
146
HOU
35
EFD
Pearland
Clear Lake
Galveston
Bay
35
League City
Alvin
Texas
City
Hitchcock
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs
below are only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
$39.00
Class A Vacancy
18.0%
16.0%
$37.00
14.0%
$35.00
12.0%
$33.00
10.0%
$31.00
8.0%
6.0%
$29.00
4.0%
$27.00
2.0%
$25.00
0.0%
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
$28.00
Class B Vacancy
$27.00
18.00%
16.00%
$26.00
$25.00
14.00%
$24.00
12.00%
$23.00
$22.00
10.00%
$21.00
8.00%
$20.00
6.00%
$19.00
$18.00
4.00%
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q3 2016
Class A: 277,680 SF or 2.5%
Class A
Class B
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
2
The Woodlands Research Snapshot | Q3 2016 | Office | Colliers International
Absorption and New Supply
Woodlands Class A Office
Net Absorption
New Supply
2,000,000
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
Woodlands Class B Office
Net Absorption
New Supply
200,000
150,000
100,000
50,000
0
-50,000
-100,000
-150,000
FOR MORE INFORMATION
Lisa Bridges
Director of Market Research | Houston
+1 713 830 2125
[email protected]
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
3
Colliers International | The
Market
Woodlands
000 Address,
1790
Hughes Landing
Suite # Blvd., Suite 250
000 Woodlands,
The
Address, Suite
TX 77380
#
+1 713
000830
0004011
0000
colliers.com/<<market>>
colliers.com/thewoodlands
North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Research Snapshot
THE WOODLANDS | OFFICE
Q1 2016
The Woodlands Office Market
Lisa Bridges Director of Market Research | Houston
The Woodlands
Q1 2016 Submarket Highlights
The greater Houston metro is home to most major energy companies and its
economy and real estate market can be positively or negatively affected by the
Office Market
Indicators
price of oil. The Q1 2016 office market continues to struggle due to the low
price of oil, but it appears to be performing better than expected in a $40 per
barrel economy. The Woodlands is not isolated from Houston’s current market
Class A
Class B
VACANCY
conditions, but does fare better than most of Houston’s other office submarkets.
NET ABSORPTION
The Woodlands Q1 2016 office market vacancy rates decreased over the quarter
with the exception of class C product. Net absorption remained positive and class
CONSTRUCTION
A rental rates rose.
RENTAL RATE
NEW SUPPLY
The Woodlands Summary
INVENTORY
Class
# of Bldgs.
DIRECT VACANCY
Total (SF)
(SF)
Rate (%)
SUBLEASE VACANCY VACANCY
(SF)
Rate (%)
Total (SF)
VACANCY RATE
Q1-2016 Q4-2015
RENTAL
RATE
NET ABSORPTION
Q1-2016
Q4-2015
AVG ($/SF)
The Woodlands
A
37
10,501,457
852,743
8.1%
54,036
B
70
4,398,619
420,049
9.5%
C
4
308,161
25,119
8.2%
15,208,237 1,297,911
8.5%
Total
111
0.5%
906,779
8.6%
9.0%
36,926
442,284
64,167
1.5%
484,216
11.0%
0
0.0%
25,119
8.2%
118,203
0.8%
1,416,114
9.3%
$35.95
11.6%
27,739
-71,790
$23.88
0.3%
-24,119
0
$19.80
9.6%
40,546
370,494
$30.06
Woodlands Submarket Map
“In The News”
1488
Wo
o
Par dlands
kwa
y
Needham Rd.
Res
ear
ch
For
est
Mil
d.
lR
Gosling Rd.
’s
gan
Gro
1314
l
h
da
n
ke
y
Ku
Huffsmith-Kohrville
2920
249
242
Spring Stuebner
The Texas Department of Transportation has
recently completed the segments of the Grand
Parkway (SH 99), from Interstate 10 West to U.S.
Highway 59 North.
To Houston CBD
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs
below are only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
$39.00
Class A Vacancy
18.0%
16.0%
$37.00
14.0%
$35.00
12.0%
$33.00
10.0%
$31.00
8.0%
6.0%
$29.00
4.0%
$27.00
2.0%
$25.00
0.0%
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
Class B Vacancy
$28.00
18.00%
$27.00
16.00%
$26.00
$25.00
14.00%
$24.00
12.00%
$23.00
$22.00
10.00%
$21.00
8.00%
$20.00
6.00%
$19.00
$18.00
4.00%
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q1 2016
Class A: 330,038 SF or 3.1%
Class B: 138,558 SF or 3.2%
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
Class A
2
Class B
The Woodlands Research Snapshot | Q1 2016 | Office | Colliers International
Absorption and New Supply
Woodlands Class A Office
2,000,000
Net Absorption
New Supply
Net Absorption
New Supply
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
Woodlands Class B Office
200,000
150,000
100,000
50,000
0
-50,000
-100,000
-150,000
FOR MORE INFORMATION
Lisa Bridges
Director of Market Research | Houston
+1 713 830 2125
[email protected]
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
3
Colliers International | The
Market
Woodlands
000 Address,
1790
Hughes Landing
Suite # Blvd., Suite 250
000 Woodlands,
The
Address, Suite
TX 77380
#
+1 713
000830
0004011
0000
colliers.com/<<market>>
colliers.com/thewoodlands
North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Research Snapshot
THE WOODLANDS | OFFICE
Q3 2015
The Woodlands Office Market
The Woodlands
Lisa Bridges Director of Market Research | Houston
Q3 2015 Submarket Highlights
>> The Woodlands Development Company signed a lease for 25,576 SF in Two
Hughes Landing.
Office Market
Indicators
>> Class A rents decreased slightly over the quarter while class B rents remained
flat.
VACANCY
>> Construction continues on 1735 Hughes Landing Blvd as well as on Three
Hughes Landing. Both buildings are expected to deliver in 2016.
Class A
Class B
NET ABSORPTION
CONSTRUCTION
>> Construction of 1725 Hughes Landing will be completed in Q4 2015 and there
is a little over 162,120 SF of available space.
RENTAL RATE
NEW SUPPLY
The Woodlands Summary
INVENTORY
Class
# of Bldgs.
DIRECT VACANCY
Total (SF)
(SF)
Rate (%)
SUBLEASE VACANCY VACANCY
(SF)
Rate (%)
Total (SF)
VACANCY RATE
Q3-2015 Q2-2015
RENTAL
RATE
NET ABSORPTION
Q3-2015
Q2-2015
AVG ($/SF)
The Woodlands
A
32
9,251,755
370,598
B
71
4,451,880
C
5
338,038
108
14,041,673
Total
4.0%
44,652
0.5%
415,250
405,767
9.1%
1,000
0.3%
777,365
5.5%
4.5%
5.2%
68,282
452,559
27,353
0.6%
0
0.0%
72,005
0.5%
$35.19
433,120
9.7%
10.5%
54,740
-115,935
$24.76
1,000
0.3%
0.3%
0
0
$19.80
849,370
6.0%
6.8%
123,022
336,624
$29.27
Woodlands Submarket Map
“In The News”
1488
Wo
o
Par dlands
kwa
y
Needham Rd.
Res
ear
ch
For
est
Mil
d.
lR
Gosling Rd.
’s
gan
Gro
1314
l
h
da
n
ke
y
Ku
Huffsmith-Kohrville
2920
249
242
Spring Stuebner
To Houston CBD
Innovators in the Woods, a partnership between
Houston Advanced Research Center in The
Woodlands and Houston Technology Center North,
is now open and accepting applicants to pitch
their energy technology ideas. The new incubator
program fosters scientific start-ups, to promote
the growth of entrepreneurial susttainable energy
techonology companies in The Woodlands area.
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs below are
only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
Class A Vacancy
$39.00
18.0%
16.0%
$37.00
14.0%
$35.00
12.0%
$33.00
10.0%
$31.00
8.0%
6.0%
$29.00
4.0%
$27.00
2.0%
$25.00
0.0%
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
Class B Vacancy
$28.00
18.00%
$27.00
16.00%
$26.00
14.00%
$25.00
$24.00
12.00%
$23.00
10.00%
$22.00
$21.00
8.00%
$20.00
6.00%
$19.00
$18.00
4.00%
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q3 2015
Class A: 261,433 SF or 2.4%
Class B: 107,815 SF or 2.3%
300,000
250,000
200,000
150,000
100,000
50,000
0
Class A
2
Class B
The Woodlands Research Snapshot | Q3 2015 | Office | Colliers International
Absorption and New Supply
Woodlands Class A Office
1,800,000
Net Absorption
New Supply
Net Absorption
New Supply
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
Woodlands Class B Office
200,000
150,000
100,000
50,000
0
-50,000
-100,000
-150,000
FOR MORE INFORMATION
Lisa Bridges
Director of Market Research | Houston
+1 713 830 2125
[email protected]
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
3
Colliers International | The
Market
Woodlands
000 Address,
1790
Hughes Landing
Suite # Blvd., Suite 250
000 Woodlands,
The
Address, Suite
TX 77380
#
+1 713
000830
0004011
0000
colliers.com/<<market>>
colliers.com/thewoodlands
North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Research Snapshot
THE WOODLANDS | OFFICE
Q2 2015
The Woodlands Office Market
Lisa Bridges Director of Market Research | Houston
Q2 2015 Submarket Highlights
Office Market
Indicators
>> ExxonMobil completed its relocation into the new 3.5M SF North Houston
campus.
>> Three Hughes Landing, a 12-story 321,000-SF Class A office building is
currently under construction and is projected to deliver in November 2015.
Class A
Class B
VACANCY
NET ABSORPTION
>> Class A rents increased slightly over the quarter while class B rents remained
flat.
CONSTRUCTION
RENTAL RATE
>> Positive net absorption and new supply reflected the continuation of
ExxonMobil’s relocation into phase III of its new campus.
NEW SUPPLY
>> Construction activity remains slow as proposed projects are still on hold due to
the slump in energy prices.
Woodlands Submarket Map
1488
242
1314
d.
il l R
Gosling Rd.
’s M
gan
Gro
l
2920
249
ah
d
en
yk
Ku
Huffsmith-Kohrville
The Woodlands
Needham Rd.
Res
ear
ch
For
est
Wo
o
Par dlands
kwa
y
Spring Stuebner
To Houston CBD
The Woodlands In The News
Memorial Hermann recently announced plans for $25 million worth of expansions and improvements. The new amenities will improve the
hospital’s heart and vascular, neuroscience, trauma and orthopedics departments.
The Woodlands Summary
INVENTORY
# OF
BLDGS.
CLASS
TOTAL
(SF)
DIRECT VACANCY
(SF)
RATE
(%)
SUBLEASE
VACANCY
RATE
(%)
(SF)
VACANCY
TOTAL
(SF)
VACANCY RATE (%)
Q2-2015
Q1-2015
NET ABSORPTION
(SF)
Q2-2015
RENTAL
RATE
AVG
($/SF)
Q1-2015
THE WOODLANDS
A
32
9,251,755
434,129
4.7%
49,403
B
70
4,426,517
442,448
10.0%
C
5
338,038
1,000
0.3%
107
14,016,310
877,577
6.3%
Total
0.5%
483,532
5.2%
5.0%
452,559
1,671,730
33,340
0.8%
475,788
0
0.0%
1,000
82,743
0.6%
960,320
10.7%
8.1%
-115,935
762
$24.66
0.3%
0.3%
0
0
$19.80
6.9%
5.9%
336,624
1,672,492
$30.28
Absorption and New Supply
Woodlands Class A Office
1,800,000
Net Absorption
New Supply
Net Absorption
New Supply
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
Woodlands Class B Office
200,000
150,000
100,000
50,000
0
-50,000
-100,000
-150,000
2
The Woodlands Research Snapshot | Q2 2015 | Office | Colliers International
$35.60
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs below are
only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
Class A Vacancy
$39.00
18.0%
16.0%
$37.00
14.0%
$35.00
12.0%
$33.00
10.0%
$31.00
8.0%
6.0%
$29.00
4.0%
$27.00
2.0%
$25.00
0.0%
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
Class B Vacancy
$28.00
18.00%
$27.00
16.00%
$26.00
14.00%
$25.00
$24.00
12.00%
$23.00
10.00%
$22.00
$21.00
8.00%
$20.00
6.00%
$19.00
$18.00
4.00%
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q2 2015
Class A: 194,363 SF or 2.0%
Class B: 117,331 SF or 2.5%
250,000
200,000
150,000
100,000
50,000
0
Class A
3
Class B
The Woodlands Research Snapshot | Q2 2015 | Office | Colliers International
502 offices in
67 countries on
6 continents
United States: 140
Canada: 31
Latin America: 24
Asia Pacific: 199
EMEA: 108
MARKET CONTACT:
Lisa Bridges
Director of Market Research | Houston
+1 713 830 2125
[email protected]
Colliers International | The Woodlands
Two Hughes Landing
1790 Hughes Landing Blvd.
The Woodlands, TX | USA
+1 713 830 4011
$2.3
billion in
annual revenue
1.7
billion square feet
under management
16,300
professionals
and staff
About Colliers International
Colliers International is a global leader in commercial real estate services, with more than 16,300
professionals operating out of 502 offices in 67 countries. A subsidiary of FirstService Corporation, Colliers
International delivers a full range of services to real estate occupiers, owners and investors worldwide,
including global corporate solutions, brokerage, property and asset management, hotel investment sales and
consulting, valuation, consulting and appraisal services, mortgage banking and insightful research. Colliers
International has been recognized and ranked by the International Association of Outsourcing Professionals’
Global Outsourcing 100 for 10 consecutive years, more than any other real estate services firm.
colliers.com
Copyright © 2015 Colliers International.
The information contained herein has been obtained from sources deemed reliable. While every reasonable effort has been made to
ensure its accuracy, we cannot guarantee it. No responsibility is assumed for any inaccuracies. Readers are encouraged to consult
their professional advisors prior to acting on any of the material contained in this report.
Q1 2015 | OFFICE
THE WOODLANDS
RESEARCH SNAPSHOT
The Woodlands Office Market
Q1 2015 SUBMARKET HIGHLIGHTS
ExxonMobil continues relocation into new North Houston campus, contributing 1.5M
SF to Q1 2015 absorption.
• Three Hughes Landing, a 12-story 321,000-SF Class A office building is currently
under construction and is projected to deliver in November 2015.
• Class A rents remained flat over the quarter while class B rents increased.
• Positive net absorption and new supply reflected the continuation of ExxonMobil’s
relocation into new buildings within its new campus.
• Sublease space increased as oil and gas company mergers and acquistions
increased and hiring was put on hold.
• Construction activity slowed as proposed projects were put on hold due to the
slump in energy prices.
•
Q1 2015 OFFICE MARKET INDICATORS
THE WOODLANDS
CLASS A
CLASS B
NET
ABSORPTION
VACANCY
RENTAL RATE
CONSTRUCTION
WOODLANDS SUBMARKET MAP
NEW SUPPLY
1488
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To download a copy of this report,
please visit:
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ear
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RESEARCH SNAPSHOT | Q1 2015 | OFFICE | THE WOODLANDS
THE WOODLANDS SUMMARY
INVENTORY
Class
# of Bldgs.
DIRECT VACANCY
Total (SF)
(SF)
Rate (%)
SUBLEASE VACANCY VACANCY
(SF)
Rate (%)
Total (SF)
VACANCY RATE (%)
Q1-2015
Q4-2014
RENTAL
RATE
NET ABSORPTION
(SF)
Q1-2015
Q4-2014
AVG ($/SF)
The Woodlands
A
32
8,891,122
385,151
4.3%
50,940
0.6%
436,091
4.9%
7.1%
1,671,730
1,621,957
$34.68
B
71
4,353,344
373,792
8.6%
19,963
0.5%
393,755
9.0%
9.1%
2,860
-10,689
$24.60
C
5
338,038
1,000
0.3%
0
0.0%
1,000
0.3%
0.3%
0
0
$19.80
108
13,582,504
759,943
5.6%
70,903
0.5%
830,846
6.1%
7.8%
1,674,590
1,611,268
$29.51
Total
ABSORPTION AND NEW SUPPLY
WOODLANDS CLASS A OFFICE
1,800,000
Net Absorption
New Supply
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
-200,000
WOODLANDS CLASS B OFFICE
200,000
150,000
100,000
50,000
0
-50,000
-100,000
P. 2
| COLLIERS INTERNATIONAL
Net Absorption
New Supply
RESEARCH SNAPSHOT | Q1 2015 | OFFICE | THE WOODLANDS
The average quoted rental rates are a mix of direct and sublet rates and are based on a blend of gross and NNN. The graphs below
are only intended to show rental rate trends. Actual gross rates are higher than the average rate shown in the graph.
Class A Rental Rate and Vacancy Percentage
The Woodlands, TX
Class A Rents
Class A Vacancy
$39.00
18.0%
16.0%
$37.00
14.0%
$35.00
12.0%
$33.00
10.0%
$31.00
8.0%
6.0%
$29.00
4.0%
$27.00
2.0%
$25.00
0.0%
*Vacancy percentage includes direct and sublease space.
Class B Rental Rate and Vacancy Percentage
The Woodlands, TX
Class B Rents
Class B Vacancy
$28.00
18.00%
$27.00
16.00%
$26.00
14.00%
$25.00
$24.00
12.00%
$23.00
10.00%
$22.00
$21.00
8.00%
$20.00
6.00%
$19.00
$18.00
4.00%
*Vacancy percentage includes direct and sublease space.
Available Sublease Space - The Woodlands
Available Sublease Space
Q1 2015
Class A: 195,818 SF or 2.2%
Class B: 95,481 SF or 1.9%
250,000
200,000
150,000
100,000
50,000
0
Class A
Class B
COLLIERS INTERNATIONAL |
P. 3
RESEARCH SNAPSHOT | Q1 2015 | OFFICE | THE WOODLANDS
OUR SERVICES
The foundation of our service is the strength and depth of our
specialists. Our clients depend on our ability to draw on years
of direct experience in the local market. Our professionals know
their communities and the industry inside and out. Whether you
are a local firm or a global organization, we provide creative
solutions for all your real estate needs.
Colliers International offers a comprehensive portfolio of real
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Copyright © 2015
Colliers International.Information herein has been
obtained from sources deemed reliable, however its
accuracy cannot be guaranteed. The user is required to
conduct their own due diligence and verification.
RESEARCHER:
THE WOODLANDS OFFICE:
Lisa Bridges
Director of Market Research
1233 W. Loop South, Suite 900
Houston, TX 77027
Two Hughes Landing
1790 Hughes Landing Blvd.
Suite 250
The Woodlands, TX 77380
TEL +1 713 830 2125
TEL +1 713 830 4011
FAX +1 713 986 4425
FAX +1 713 986 4434
Accelerating success.
P. 4
| COLLIERS INTERNATIONAL
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