The document summarizes commercial real estate trends in the Fort Bend submarket for Q3 2013. It finds that the office vacancy rate decreased from 30.5% to 26.8% with positive absorption of 81,000 square feet. The industrial vacancy rate also decreased from 7.4% to 5.6% with year-to-date absorption of 312,000 square feet. Meanwhile, the retail market posted 35,800 square feet of positive absorption, keeping the average vacancy rate steady at 5.0%.

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Q3 2013 | SUBMARKET SNAPSHOT
Industrial
3Q12 3Q13
VACANCY 7.4% 5.6%
ABSORPTION -59,000 29,200
RENTAL RATE $5.86 $6.58
Retail
3Q12 3Q13
VACANCY 6.8% 5.0%
ABSORPTION -5,084 35,800
RENTAL RATE $19.44 $17.21
Office
3Q12 3Q13
VACANCY 30.5% 26.8%
ABSORPTION 28,200 81,100
RENTAL RATE $25.08 $24.92
OFFICE MARKET
The Fort Bend office submarket posted 81,124 SF of positive
net absorption in the third quarter of 2013, bringing the year-to-
date total to 104,612 SF. The average vacancy rate decreased
to 26.8% from 30.5% in Q3 2012 and the average quoted rental
rate decreased slightly to $24.92 from $25.08 per SF, however,
on a quarterly basis increased 0.8% from $24.71 per SF. Year-
to-date leasing activity reached 390,000 SF. Texas Instruments
is currently constructing a new 165,000-SF office building which
is scheduled to deliver during first quarter 2014.
MEDICAL OFFICE MARKET
Fort Bend's medical office average vacancy rate increased
between quarters by 50 basis points (bps) from 7.2% to 7.7%,
but decreased 140 bps from 9.1% in Q3 2012. The average
quoted rental rate increased 0.5% from $23.60 to $23.71 per SF
between quarters and decreased 2.4% from $24.28 per SF in
Q3 2012. The submarket posted 6,551 SF of negative net
absorption in the third quarter. Empire Commercial Developers
will construct a 56,000-SF medical office building with a 3-story
garage in Telfair for a group of doctors.
INDUSTRIAL MARKET
Year-to-date, the Fort Bend industrial submarket has absorbed
312,000 SF. The industrial average vacancy rate decreased to
5.6% from 7.4% in Q2 2012, and from 5.8% in Q2 2013. The
quoted average rental rate for industrial space increased from to
$6.58 from $5.80 per SF NNN between quarters. No new
buildings were delivered during the third quarter, and there is
one 27,300-SF building under construction.
RETAIL MARKET
Fort Bend's retail market posted 35,800 SF of positive net
absorption in the third quarter, bringing the year-to-date total to
344,500 SF. The average retail vacancy rate for all product
types remained at 5.0%. Third quarter leasing activity reached
144,900 SF, and most of the leases signed were renewals. Two
buildings totaling 41,900 SF were added to inventory during the
third quarter.
SUBMARKET SNAPSHOT
E. FORT BEND COMMERCIAL REAL ESTATE TRENDS
E. Fort Bend Market Indicators
Medical Office
3Q12 3Q13
VACANCY 9.1% 7.7%
ABSORPTION -24,162 -6,550
RENTAL RATE $24.28 $23.71

2. SUBMARKET SNAPSHOT | Q3 2013 | E FORT BEND
COLLIERS INTERNATIONAL | P. 2