- Houston office investment totaled $1.5 billion in the first seven months of 2026, sixth among the top 25 U.S. markets, while vacancy rose to 24.1%.
- Big trades included Williams Cos. buying Williams Tower for $300 million and TPG acquiring Hess Tower for about $224.3 million, at a metro average of $158.90 per square foot.
- Medical and life science projects dominate a 2.3 million-square-foot pipeline, signaling that new Houston office demand is concentrated in specialized space rather than traditional towers.
Houston logged $1.5 billion in office sales in the first seven months of 2026, ranking sixth among the top 25 U.S. markets, according to Yardi Matrix data reported by Commercial Property Executive. The Houston office market kept attracting capital even as vacancy climbed to 24.1% in July.
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Capital Keeps Coming
Among peer metros, Houston trailed only Dallas, which posted $2.3 billion in sales. Houston also edged out Austin at $1.4 billion. Atlanta and Phoenix each recorded roughly $790 million.
Buyers paid an average of $158.90 per square foot. That was below the $197.97 national benchmark.
As a result, Houston remained well below Nashville at $465.24 and Austin at $352.39. However, its pricing was roughly in line with Atlanta at $157.54.
The Details
Williams Cos. bought its namesake Williams Tower in July. The 64-story property spans 1.5 million square feet at 2800 Post Oak Blvd.
The company paid $300 million to Invesco Real Estate. It was the largest single-building office sale in Houston since 2019.
Meanwhile, TPG acquired the 844,763-square-foot Hess Tower for an estimated $224.3 million. Canada-based H&R REIT had owned the property for 15 years.
The sale was part of the REIT’s effort to unload a $1.5 billion portfolio. The portfolio also includes retail stakes and Canadian assets.
By the end of July, Houston had about 2.3 million square feet under construction. The total covered 21 projects and equaled 0.8% of existing stock.
That figure ranked second among peer markets. Dallas led with 3.4 million square feet under construction.
The largest project is MD Anderson Cancer Center’s 600,000-square-foot Research Building 5. The $668 million project is due for completion in 2027.
Next is an MD Anderson research facility at 7510 Bertner Ave. The project spans 281,254 square feet and is slated for 2028.
Deliveries totaled 896,874 square feet across 10 projects. That was up 19% year over year.
Midway’s CITYCENTRE Six led deliveries at 319,904 square feet. The building sits at 903 Town and Country Blvd.
Midway broke ground on the project in 2024. It delivered the building in March as part of a campus with five office buildings, a hotel, and multifamily.
Vacancy Outpaces Peers
Houston’s vacancy rate reached 24.1%. The rate rose 330 basis points over 12 months.
It also sits well above the 17.7% national average. Among peer markets, only Austin was higher at 24.5%.
By comparison, Atlanta had an 18.6% vacancy rate. Phoenix stood at 16.9%.
The figures add to evidence of an uneven office recovery across the metro.
Average listing rates reached $29.45 per square foot. That made Houston the most affordable office market in its peer set.
Dallas averaged $32.99 per square foot. Atlanta reached $36.64, while Austin averaged $46.77.
Houston ranked 20th among major U.S. office markets by rents. Nationally, Orlando was cheaper at $25.52, followed by Detroit at $21.11.
Meanwhile, Mitsubishi Corp. signed one of the summer’s notable deals in July. The company took 91,761 square feet across four floors at 1100 Louisiana St.
Enterprise Products Partners owns the 1.3 million-square-foot CBD tower.
Why It Matters
Houston’s numbers show investors are separating individual assets from the broader market. For example, Williams Cos. and TPG are paying for top-tier towers even as overall vacancy rises.
The development mix reinforces that split. As of June 2025, Houston led the U.S. in medical office inventory.
The market had 101.2 million square feet across 896 properties. Meanwhile, its competitive office pipeline totaled 823,528 square feet.
That pipeline equals just 0.3% of existing stock. The figure is below the 0.4% national average.
As a result, the widening quality gap could persist.
What’s Next
Houston recorded only 703,384 square feet of new starts through July. At the same time, little speculative space remains underway.
Therefore, Houston’s vacancy trajectory now depends on backfilling existing buildings. Coworking remains a small part of the market.
CoworkingCafe counts about 5 million square feet across 255 coworking locations. That represents 2% of leasable inventory, compared with 2.4% nationally.
Regus leads the market with 678,294 square feet. Workstyle Flexible Spaces and The Cannon follow.
