Houston used to be the city that was protected from the brunt of the recession storm, but not many people can say that anymore. And in the middle of all the uncertainty is the commercial real estate market, which may also be headed for trouble as the year comes to an end.
Property sales for commercial real estate have dropped significantly, and vacancies have risen in their place. Lower oil prices and a tough credit market have sent the commercial real estate market off course and into uncertain waters.
We have witnessed sales of office buildings drop off a cliff from the end of 2008. In fact, sales of office buildings in Houston were off 56 percent between 2007 and 2008. Many companies have backed out of plans to expand or relocate, and many have simply downsized to save costs.
Combine that with worries of a second round of foreclosure problems, and a recipe for disaster begins to pan out.
Where do we go from here?
So, where does this leave building owners? For many, the need to lease office space has resulted in much lower rental rates and the lure of incentives. It has also left business owners in an advantageous position, as they have many options regarding rental space.
From office space to retail and commercial properties, the commercial real estate market in Houston is facing an uncertain future as vacancy rates climb and the recession takes it hold.
Opportunities for Rental Properties
If you are interested in commercial rental space in Houston, now may be the time to snag a great deal, complete with incentives and perks. Many commercial building owners are offering everything from free rent to free parking, so consider all of your options if you are in the market for office, retail or commercial space.
Tags: commercial real estate