At a glance
- Direct vacancy held at 5.6% for a second consecutive quarter.
- Net absorption reached 551,122 square feet in the quarter, up from 39,756 square feet in the prior quarter.
- Owners and allocators underwriting to in-place rents can use the 8.1% gain to push for higher resets at lease roll, supporting net operating income.
Houston's average direct asking triple-net retail rent reached a record $22.03 per square foot in the third quarter, about 8.1% above the year-earlier level, according to Connect CRE, which cited Lee & Associates data. Direct vacancy held at 5.6% for a second consecutive quarter.
Net absorption reached 551,122 square feet in the quarter, up from 39,756 square feet in the prior quarter. Leasing activity totaled roughly 1.75 million square feet, bringing the year-to-date total to nearly 5.9 million square feet. Houston has logged more than 1.1 million square feet of positive net absorption through the first nine months of 2026.
Owners and allocators underwriting to in-place rents can use the 8.1% gain to push for higher resets at lease roll, supporting net operating income. The offset is supply: Houston's construction pipeline reached about 5.1 million square feet, the highest since 2019, while quarterly deliveries eased to roughly 449,000 square feet, concentrated in suburban growth corridors. That combination suggests the suburban corridors taking the new space are where the third quarter's absorption pace will be tested first.
Reported by the Sectors desk from Connect CRE, citing Lee & Associates. Published . Corrections