These Are The Largest Office Leases Signed In Houston In 2021
In 2021, the public conversation was less concerned about where to lease the perfect office and far more centered around whether most Americans would regularly work out of one again. Amid a flurry of new buzz phrases, from the Great Resignation to the Great Reshuffle, experts watched and wondered when the mass return to the office would happen, what shape it might take and if employees would return at all.
Houston was no exception. And while the city is faring better than most large metros in terms of percentage of workers returning to the office, big new leases were few and far between.
"For [employees] to come in, they have to be able to do something that they can't do otherwise at home," JLL Houston Senior Vice President Anya Marmuscak told Bisnow. "I think that's translated in some of the market activity we've seen. I think we continue to see a flight to quality buildings that offer these better workplaces with more amenities."
Through the overall commercial real estate recovery in 2021 that saw industrial and multifamily soar, office continued to lag. As of Q3, the market had racked up a total of 2.2M SF of occupancy losses year-to-date, according to JLL, and vacancy in Houston increased for the seventh consecutive quarter to 27.2%, a new record high.
Marmuscak, however, began to see progress in the second half of the year, as companies began to tour spaces and sign more leases. Though two prominent variants, delta and omicron, have delayed returning to the office for some, more Houstonians, and Texans in general, are going back to the office than in other comparable markets.
Over the past year, the largest leases signed in the greater Houston area included everything from renewals to new leases, downtown to Westchase, across different quarters and brokerage firms. Only four leases cracked over 100K SF, and most were stalwart organizations or companies renewing their lease, some renewed without press.
Shell Trading & Supply North America, a market interface company with Houston oil giant Shell Oil Co., was quickly called the largest lease of the year when it announced its early lease renewal in November. By the end of the year, no lease in town had beat it.
The 258K SF, eight-floor lease at 1000 Main in downtown, came ahead of when the company's lease was set to expire in 2025. Wade Bowlin with Madison Marquette represented the landlord, Union Investment, while Tim Relyea and Joseph Peddie represented the tenant.
1000 Main had just opened an amenity center that summer, with a 12.5K SF lounge area, a coffee station, a 144-person conference room, a fitness center and a game room.
Despite Shell Trading’s downtown renewal, total leasing volume was almost 54% below the five-year quarterly average, per JLL.
After Shell's lease, several of the top four deals of the year were either unnamed or snuck through without announcement. The Harris County District Attorney's Office renewed its 140K SF lease downtown at 500 Jefferson St. In Westchase, an unnamed tenant signed a new, 125K SF lease at Millennium Tower at 10375 Richmond Ave. Global industrial gases and engineering company Linde Engineering re-signed for its 120K office space in The Woodlands, the company's U.S. headquarters, and UT Physicians announced it would consolidate five locations under a new 139K SF lease in Bellaire Station at 6500 West Loop South, a revamped former office building.
Below is the full list of the top five office leases in Houston. The data was collected from CoStar and Avison Young research and provided to Bisnow.
Shell Trading & Supply North America
Renewal: Signed Q3
Square footage: 258K
Building name: 1000 Main
Address: 1000 Main St.
Submarket: Downtown
Tenant representative firm: Cushman & Wakefield
Landlord representative firm: Madison Marquette
Harris County District Attorney Office
Renewal: Signed Q2
Square footage: 140K
Building name: 500 Jefferson
Address: 500 Jefferson St.
Submarket: Downtown
Tenant representative firm: Unnamed
Landlord representative firm: Greenmark Realty
Unnamed
New: Signed Q3
Square footage: 125K
Building name: Millennium Tower
Address: 10375 Richmond Ave.
Submarket: Westchase
Tenant representative firm: Unnamed
Landlord representative firm: Stream Realty Partners
Linde
Renewal: Signed Q1
Square footage: 120K
Building name: Sierra Pines I
Address: 1585 Sawdust Road
Submarket: The Woodlands
Tenant representative firm: CBRE
Landlord representative firm: Stream Realty Partners
UT Physicians
New: Signed Q3
Square footage: 96K
Building name: Bellaire Station
Address: 6500 West Loop S.
Submarket: Bellaire
Tenant representative firm: Unnamed
Landlord representative firm: Transwestern Real Estate Services
