- Houston recorded positive office net absorption for a second straight quarter, with 13,500 SF in Q3 after 209,000 SF in Q2, bringing the year-to-date total to 56,000 SF.
- All newly leased space in Q3 was Class A, mostly in buildings built since 2015, and top-tier offices rent for 65% more than older units, per JLL.
- Quarterly leasing reached 2.4M SF and is near 8M SF year to date, but JLL says Houston still walks a fine line between occupancy gains and losses.
Houston’s office market posted positive net absorption for a second straight quarter, led by new Class A space, according to JLL.
Leased office space grew by 13,500 SF in Q3 2026, after 209,000 SF in Q2. Year-to-date net absorption stands at 56,000 SF.
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Class A Drives the Gains
Newly leased space in Q3 was entirely Class A, JLL said, with the majority in buildings built since 2015.
Demand for top-tier space has pushed up rents. Those offices rent for 65% more than older units.
Leasing Totals 2.4M SF
Total leasing activity reached 2.4M SF in the quarter, led by two undisclosed transactions. Year-to-date leasing is close to 8M SF.
The largest public lease was the Harris County Flood Control District’s 87,000 SF office in the West Belt. Target Hospitality had the next largest, a 52,000 SF relocation to Two Hughes Landing in The Woodlands.
Small Numbers, Big Shift
Rachel Alexander, JLL’s senior director of Texas research, said it may seem odd to get excited about 13,000 SF of absorption in a quarter or 56,000 SF year to date. But she called it a big deal against the negative perception that has hung over office.
“We walk a fine line sometimes between occupancy gains and occupancy losses, particularly in Houston,” Alexander said.
Why It Matters
The gains are tiny relative to Houston’s inventory, but positive absorption two quarters in a row marks a change from the pandemic slump. The recovery is also narrow, concentrated in newer Class A buildings.
That contrasts with other markets, such as San Francisco, where office demand has spread to Class B. Alexander said Houston’s recovery largely mirrors the rest of Texas, where the office sector has been slow to recover since the pandemic.
What’s Next
JLL is hopeful Houston will end the year on the positive side after a couple of quarters of gains. Watch whether leasing broadens beyond top-tier buildings.
