Houston’s industrial market continued to enjoy strong momentum during the third quarter of 2021. Fueled by demand for e-commerce and consumer goods, at least 15 leases of more than 100K SF were signed during the quarter, according to research collected by Avison Young.
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Brokers and industry experts have told Bisnow that significant absorption is happening across the greater Houston area, which in turn is helping to counteract the oversupply created by tens of millions of square feet delivered in 2019 and 2020.
Disruptions to the global supply chain have also resulted in new international and U.S. firms looking to Port Houston to import their goods, generating further demand for large warehouse and distribution space in the city.
As demand has ramped up, industrial developers are now paying anywhere between 30% and 50% more for well-situated land than just a few years ago. Those costs are expected to be passed down to tenants in the near future, with experts predicting spiking rents after years of sluggish growth.
Houston has also seen the trend of industrial buildings getting bigger. That trend came to a head this month, when TGS Cedar Port Partners LP announced that it had broken ground on the largest speculative industrial building to date in Houston: a 1.2M SF cross-dock warehouse within the TGS Cedar Port Industrial Park in Chambers County.
Here are the six biggest industrial leases by square footage that took place in Houston during Q3 2021, according to Avison Young research.
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West Ten Business Park
Tenant: Crawford Electric
Landlord: EQT Exeter
Address: 501 Commerce Parkway
Submarket: I-10 West/Katy Freeway
Size: 500K SF
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South Belt Central Business Park
Tenant: Yokohama Off-Highway Tires, America Inc.
Landlord: Investment & Development Ventures LLC
Address: 4851 Sam Houston Parkway
Submarket: South
Size: 305K SF
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HITC Logistics Park
Tenant: Amazon
Landlord: Logistics Property Co.
Address: 8903 Warehouse Center Drive
Submarket: North
Size: 296.1K SF
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Port Crossing Commerce Center
Tenant: Undisclosed
Landlord: Prologis
Address: 1842 South 16th St.
Submarket: Southeast
Size: 247.2K SF
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290 Commerce Center (build-to-suit)
Tenant: Undisclosed e-commerce tenant
Landlord: Vigavi Realty
Address: 15302 Cypress North Houston Road
Submarket: Northwest
Size: ~200K SF
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Northwest Industrial Park
Tenant: Polytex Fibers
Landlord: Nuveen
Address: 9282-9298 Baythorne Drive and 4820 Blalock Road
Submarket: Northwest
Size: 199.5K SF
