Landlord Representation in Houston Office Space - "The Times They Are A-Changin'"
May 19, 16
Houston today has one hand in the previous bust and one hand in the emerging boom. As the price of oil fell the Houston commercial office space vacancies rose, and while oil price is now beginning to show signs of recovery the commercial office space vacancy rate is trying to drop.
Marvy Finger a Houston developer, highlights the differences in commercial office space vacancies of '80's with today and reasons why Houston is in better shape today compared to the 80's, in an article appearing in the May 2016 issue of Houstonia by Roxanna Asgarian.
• Big oil is playing a big role as it did before. Between 1981 and 1986 oil dropped from $80 to $30 (inflation adjusted), in 2008 from $145 to $30.28 and in 2014 from $100 to $30. Accordingly, commercial office space vacancy rates skyrocketed to 30% after the 80's oil crash but have dampened to half that rate, 17% to 15%, on this last cycle.
• Showing signs of recovery since 2010, commercial office space vacancy rates have steadily decreased. Though the first quarter 2016 commercial office space vacancies rate rose ten basis point, the long-term trend continues down as oil price has risen from below $30 to $45 during the same time period. The commercial office space rate lags oil.
• The history of previous oil cycles does not necessarily apply today because industrial oil is in a refinery growth, the banking system reform decreased the leverage on investments over the last decade, and U.S. businesses are rapidly becoming more viable because of continued emergence of automation, both IT and robotic. On the other hand, companies are reorganizing and using less space, floating the vacancy rate of commercial office space.
• Finger also points out that Houston has grown in wealth, sophistication and has had a controlled expansion of commercial office space between 2010 and 2015. I've got to think long-term, concludes Finger, And remember that it will get better.
• Though commercial office vacancy rates are to continue around 15% in 2016, there are opportunities to take advantage of because of the changing underlying dynamics of the market.
At LandPark Commercial we use creative marketing strategies and a large network of brokers to get your vacancies filled quickly. We provide optimum exposure to the brokerage community and use aggressive direct marketing. Contact us for landlord representation in Houston office space because "The Times They Are A-Changin'" and we at LandPark Commercial mean changing for the better.