Q4 2014 E. Fort Bend Submarket Snapshot
The Fort Bend office submarket posted 23,725 SF of positive net absorption in the fourth quarter of 2014, pushing the year-end total to 253,876 SF. The average vacancy rate fell 40 basis points (bps) from 13.7% to 13.3% between quarters, and decreased 160 bps from 14.9% in Q4 2013. The average quoted rental rate increased 1.0% from $25.01 to $25.26 per SF between quarters and rose 3.1% from $24.50 per SF in Q4 2013.
MEDICAL OFFICE MARKET
The average quoted rental rate increased 1.8% from $24.18 to $24.61 per SF between quarters and increased by 4.5% from $23.56 per SF in Q4 2013. Due to the delivery of the Sugar Land Physicians Center 1, a 57,000-SF medical office building in Telfair, the vacancy rate increased from 12.1% to 13.1% between quarters. Memorial Hermann Sugar Land Hospital continues construction on its campus expansion which will double the size of the existing facilities. The first phase of construction is scheduled to be completed by early 2015.
The average vacancy rate for the Fort Bend industrial submarket decreased 10 bps from 6.6% in Q4 2013 to 6.5%. The quoted average rental rate for industrial space decreased from $6.78 in Q4 2013 to $6.49 per SF NNN. Construction continues on Aldi’s new 650,000-SF distribution center and division headquarters on Highway 90A West in Rosenberg. The project is expected to be completed by Q1 2016. Trammell Crow recently announced plans to develop Park8Ninety, a premier 125-acre business park located in Missouri City at Hwy 90A and Beltway 8.
The average asking rental rate for the Fort Bend retail submarket increased 4.6% from $18.22 per SF in Q4 2013 to $19.06 per SF. The average vacancy rate remained unchanged at 4.8%. One of the largest retail projects under construction is a new Gallery Furniture location along the Grand Parkway in The Market at Long Meadow Farms in Richmond. The 165,000-SF showroom, scheduled to open in March 2015, is a result of a boom in residential growth in Fort Bend County.
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