Houston, TX – Avison Young today released its Second Quarter 2024 Industrial Market Report for Houston. The Houston industrial market absorbed 3.6 million square feet (msf) in the second quarter, bringing the mid-year total to 7.3 msf. While total net absorption during the first half of 2024 fell by 51.1% compared to the same period last year, it remains 21% above the healthy pre-pandemic average (2016 to 2019).

Developers delivered nearly 6.0 msf of new industrial space in the Houston market in the second quarter, almost double the pre-pandemic average of 3.8 msf. This has helped reduce the construction pipeline to 11.5 msf, with 8.7 msf of new product slated to deliver by year-end.

While Houston’s construction pipeline has considerably declined to its lowest level since 2017, industrial space completions outpaced demand for the sixth straight quarter, pushing vacancy rates up 30 basis points (bps) from the prior quarter and a substantial 180 bps year-over-year.

“While demand for industrial space has normalized after the record-setting post-Covid years, Houston’s industrial market remains robust due to a healthy manufacturing sector, industrial job growth, and sustained activity at the Port of Houston,” said Drew Coupe, Principal and industrial tenant representation specialist with Avison Young.

Container traffic at the Port of Houston grew 21% year-over-year as of May 2024, handling 4.0 million TEUs in the past 12 months.