Future Cities
Houston Market
2025 North America Industrial Big-Box Review & Outlook
April 16, 2025 5 Minute Read
Supply & Demand
Houston remains one of North America’s top growth markets despite a decline in leasing . Lease transaction volume decreased by 46% from 2022’s record pace to 10.4 million sq. ft. Despite this decrease, Houston was North America’s third growth market (net absorption/existing inventory) with 13.6 million sq. ft. absorbed. However, new supply outpaced demand as a record 32.7 million sq. ft. of construction was completed, raising the vacancy rate to 7.8%. A diverse set of occupiers leased space in 2023, led by 3PLs at 33.2% of total volume, followed by general retail & wholesale at 28.5%, and building materials & construction at 20.7%.
By the end of 2023, only 10.4 million sq. ft. of space was under construction, a 63% year-over-year decline, with nearly half preleased. Transaction volume should increase this year as improved economic clarity attracts more tenants into Houston that want to leverage its growing population and numerous logistics drivers. The combination of increased demand and significantly decreased supply is expected to lower vacancy rates by the end of this year.
Figure 4: Share of 2023 Leasing by Occupier Type
Source: CBRE Research.
Figure 5: Lease Transaction Volume by Size Range
Source: CBRE Research.
Figure 6: 2023 Construction Completions vs. Overall Net Absorption by Size Range
Figure 7: Direct Vacancy Rate by Size Range
Figure 8: Under Construction & Percentage Preleased
Figure 9: First Year Taking Rents (psf/yr)
Source: CBRE Research.
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Industrial & Logistics Research
James Breeze
Vice President, Global Industrial and Retail Research
John Morris
President, Americas Industrial & Logistics, Advisory Services
