E Fort Bend Commercial Real Estate Trends

1. E Fort Bend Commercial Real Estate Trends
Submarket Snapshot
FORT BEND
Q2 2019
Lisa Bridges Director of Market Research | Houston
Office Market
The Fort Bend office submarket posted 67,322 SF of negative net absorption in Q2
2019. The average vacancy rate rose 210 basis points (bps) increasing to 12.4% over
the quarter due to the addition of 50 lease spaces. The average quoted rental rate
increased from $27.69 to $28.80 per SF. Leasing activity decreased over the quarter
by 35%. HCSS is expanding their footprint with the addition of a 56,000-SF office
building on their current campus on Airport Blvd.
Medical Office Market
The average quoted rental rate decreased 3.6% over the quarter from $29.05 to
$28.00 per SF. The average vacancy rate dropped 50 bps from 14% in Q1 2019 to
13.5% in Q2 2019. Leasing activity increased significantly, growing by 88% over the
quarter. Three buildings totaling 136,190 SF are currently under construction. The
largest of the three is an 87,500-SF, 100% pre-leased medical office condo located at
800 Bonaventure Way.
Industrial Market*
The submarket recorded 6,233 SF of negative net absorption during Q2 2019, a major
tumble from the 269,713 SF of positive net absorption recorded in Q1 2019. Because
639,764 SF of new buildings were completed this quarter, the average industrial
vacancy rate rose 180 basis points, increasing from 3.8% to 5.6%. The average quoted
rental rate rose 11.9% over the quarter from $6.73 per SF to $7.53 per SF. Currently,
there are 29 buildings with almost 2M SF of industrial space under construction.
The largest project is a 352,769-SF speculative distribution center located in the
Park 8Ninety industrial park in Missouri City, TX. Tramontina USA, a major Brazilian
company and one of the larger employers in Sugar Land, announced they were
scaling back their domestic operations and laying off 150 employees in this market.
They already have 229,000 SF of space on the sublease market but that number may
increase as a result of the layoffs.
Retail Market
The average asking rental rate for the Fort Bend retail submarket decreased marginally
from $23.26 per SF in Q1 2019 to $23.05 per SF in Q2 2019. The submarket recorded
29,417 SF of positive net absorption in Q2 2019 but the vacancy rate remained at
5.2%. There are nine properties totaling 152,516 SF under construction. The largest
project is Sienna Crossing Phase III, a 60,000-SF addition that will include Spec’s
Wine and 24-Hour Fitness as new tenants. The shopping center is expected to be
completed around January 2020.
Market
Indicators Q1 2019 Q2 2019
OFFICE
VACANCY 10.3% 12.4%
NET ABSORPTION -15,895 -67,322
RENTAL RATE $27.69 $28.80
MEDICAL OFFICE
VACANCY 14% 13.5%
NET ABSORPTION 9,968 8,125
RENTAL RATE $29.05 $28.00
INDUSTRIAL
VACANCY 3.8% 5.6%
NET ABSORPTION 269,713 -6,233
RENTAL RATE $6.73 $7.53
RETAIL
VACANCY 5.2% 5.2%
NET ABSORPTION 1,388 29,417
RENTAL RATE $23.26 $23.05
Data Source: CoStar Property
* For the purpose of this report, the geographical boundaries
for the Fort Bend industrial submarket include buildings that
are typically considered by our clients when they are seeking
locations in the Fort Bend/Sugar Land and Missouri City areas.

2. 2 North American Research & Forecast Report | Q4 2014 | Office Market Outlook | Colliers International
Copyright © 2019 Colliers International
The information contained herein has been obtained from sources deemed reliable. While
every reasonable effort has been made to ensure its accuracy, we cannot guarantee it. No
responsibility is assumed for any inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the material contained in this report.
Colliers International | Fort Bend
15999 City Walk, Suite 250
Sugar Land, Texas 77479
+1 281 494 4769
colliers.com/sugarland
Representative Properties
Land
1.5 AC COMMERCIAL PAD SITE
Office Development Pad Site
Creekbend Dr, Sugar Land, TX
Office
SUGAR LAND OFFICE INVESTMENT
Office/Bank Building for Sale
4690 Sweetwater Blvd, Sugar Land, TX
Retail
LEXINGTON SQUARE
Retail/Office Space for Lease
16525 Lexington Blvd, Sugar Land, TX
Industrial
10749 CASH ROAD
40,000 SF Warehouse/Office for Lease
Freeport Southwest Business Park
Missouri City, TX
34.3 AC REDEVELOPMENT SITE
Largest Contiguous Tract in Stafford
SEC Mula & Murphy Rds, Stafford, TX
SUGAR LAND BUSINESS PARK
7,000 SF Office for Sale or Lease
12551 Emily Ct, Sugar Land, TX
THE SHOPPES AT SIENNA PLANTATION
2,201 SF End Cap Retail Space for Lease
Hwy 6/Sienna Plantation, Missouri City, TX
NEWLY CONSTRUCTED WAREHOUSE
±20,036 SF Warehouse/Office for Lease
6911 Brasada Dr, Houston, TX
Kolbe Curtice
Managing Director | Fort Bend
281 494 4769
kolbe.curtice@colliers.com
Jim Pratt
Principal | Fort Bend
713 830 2147
jim.pratt@colliers.com
Barkley Peschel
Senior Vice President | Fort Bend
281 242 2300
barkley.peschel@colliers.com
Jason Scholtz
Vice President | Fort Bend
281 269 3444
jason.scholtz@colliers.com
FORT BEND TEAM