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Houston retail occupancy stays near record highs at 95.2%
Houston retail finished the second quarter at 95.2% occupancy, and brokers point to quick backfills as new and existing spaces compete for tenants.
Houston’s retail market is sustaining a record-high occupancy streak, with demand quickly filling new and vacated spaces across the metro, according to Bisnow citing a Weitzman report. Houston retail ended the second quarter at 95.2% occupancy, a level brokers described as evidence of a balanced market that is getting more competitive.
Even so, some prominent vacancies remain, including a former Whole Foods at 515 Elgin St. that shuttered nearly three years ago and is tied to an apartment complex called Pearl Marketplace. Weitzman Senior Vice President Kyle Knight said the space, identified in the report as about 40,000 square feet, could still be available for several reasons.
Knight said leasing constraints can narrow the tenant pool if the space must be taken in its entirety, and he suggested likely candidates could include larger-format fitness operators, entertainment concepts, or even medical office tenants. He also said the location sits in an in-between area for grocers, noting Randalls is the only remaining grocery store in Midtown, and that some concepts may not require that much space.
Bisnow also highlights competitive grocery pressure as a factor behind store closures in the area. Cushman & Wakefield Managing Director Eric Lestin said Houston has strong competitors in the grocery sector, with Albertsons PR director Christy Lara telling Chron that the company sometimes closes stores so it can reinvest in remaining locations. The article notes reports of a specialty grocer that could backfill the 515 Elgin St. space.