Key Takeaways

CRE Snapshot

E Fort Bend -
Sugar Land
• Office leasing activity rises along with rents

23Q3
• Medical office construction climbs
• Industrial supply outpaces demand, positive absorption
• Retail records positive absorption, vacancy drop

YOY YOY Under YOY Overall Avg Asking YOY

Vacancy Rate Net Absorption Construction Lease Rate (gross)

20.5% FORECAST (10.1K) SF FORECAST

0 SF FORECAST
$30.09/SF FORECAST

Office Highlights
A total 1.9 million square feet of office space is available in the E Fort Bend/Sugar Land office submarket; this includes 1.5 million
square feet of general-purpose office space and 382,644 square feet of medical-office space. The submarket contains 5.9 million
square feet of general-purpose office inventory and recently experienced a 10,095-square-foot net absorption loss during third
quarter. Year-to-date absorption also turned negative with 1,693 square feet. The average vacancy rate climbed 120 basis points to
20.5% during the current quarter, although the average quoted gross rental rate increased from $29.65 per square foot to $30.09 per
square foot. Leasing activity picked up during third quarter, bringing the year-to-date total to 102,766 square feet. No office buildings
are currently under construction or delivered during the current quarter.
YOY YOY
Under
YOY Overall Avg Asking YOY
Vacancy Rate Net Absorption Construction Lease Rate (gross)

18.9% FORECAST
(60.8K) SF FORECAST
208.3K SF FORECAST
$27.22/SF FORECAST

Medical Office Highlights

The E Fort Bend/Sugar Land medical-office submarket contains 2.2 million square feet of medical-office inventory with a current
vacancy rate of 18.9%, a substantial increase from last quarter’s 15.0% rate. Net absorption turned negative but remained positive
year-to-date with 94,581 square feet. Leasing activity slowed but was stable with an average 17,000 square feet each quarter in 2023.
The average quoted gross rental rate marginally increased to $27.22 per square foot during the third quarter. Three medical-office
buildings totaling 208,259 square feet are currently under construction while no new supply was delivered.
YOY YOY Under YOY Overall Avg Asking YOY
Vacancy Rate Net Absorption Construction Lease Rate (NNN)

12.1% FORECAST
368.2K SF FORECAST
2.8M SF FORECAST
$10.76/SF FORECAST

Industrial Highlights
The Fort Bend/Sugar Land industrial submarket contains 37.8 million square feet of industrial space that jumped to 12.1% vacant
from 11.2% the prior quarter. The submarket recorded 368,173 square feet of net absorption in Q3 2023 with 616,341 square feet
year-to-date. Supply is outpacing demand with 3.7 million square feet delivered while 2.8 million square feet is underway. Distributive
Alternatives signed the largest lease in the metro during third quarter, taking down the entire 855,610-square-foot distribution
warehouse in Kingsland Ranch Logistics Park, which will be complete by yearend.
YOY YOY Under YOY Overall Avg Asking YOY
Vacancy Rate Net Absorption Construction Lease Rate (NNN)

3.7% FORECAST
47.6K SF FORECAST
20.5K SF FORECAST
$14.89/SF FORECAST

Retail Highlights
The E Fort Bend/Sugar Land submarket contains 11.7 million square feet of retail space. The submarket posted net absorption of
47,634 square feet during Q3 2023 for a year-to-date total of 81,208 square feet. Vacancy fell 30 basis points to 3.7% while the average
asking rental rate marginally increased to $14.89 from $14.62 per square foot the previous quarter. Two small retail properties are
currently under construction in the submarket.
E Fort Bend - Sugar Land | Q3 2023 | CRE Snapshot

Market Statistics
Total Direct Sublease Total Total Previous Net Net Avg Direct
Inventory Availability Availability Availability Vacancy Vacancy Absorption Absorption Under Deliveries Asking Rate
SF Rate Rate Rate Rate Rate Current YTD Construction YTD (NNN)

Office

Class A 3,601,120 21.3% 1.7% 23.0% 21.5% 21.8% 9,913 1,649 0 0 $32.04
Class B 2,264,037 19.8% 2.1% 21.9% 19.2% 18.4% (20,008) (3,342) 0 0 $25.73
Class C 46,239 0.0% 0.0% 0.0% 0.0% 0.0% 0 0 0 0 $0.00

OFFICE TOTALS 5,911,396 20.6% 1.8% 22.4% 20.5% 19.3% (10,095) (1,693) 0 0 $30.09

Medical Office
Class A 427,021 29.4% 0.7% 30.1% 26.4% 22.7% (15,620) 144,380 0 0 $23.18

Class B 1,595,437 19.1% 2.9% 24.5% 16.5% 13.1% (45,152) (89,531) 208,259 0 $29.22

Class C 130,154 12.7% 0.0% 12.7% 12.7% 12.7% 0 39,732 0 0 $23.28

MEDICAL OFFICE
2,152,612 20.6% 2.3% 24.9% 18.9% 15.0% (60,772) 94,581 208,259 0 $27.22
TOTALS
Industrial
Manufacturing 2,280,129 1.5% 0.0% 1.5% 0.0% 0.2% 4,000 16,543 0 0 $12.00

Office Service/Flex 3,915,999 8.3% 1.4% 9.7% 6.7% 6.3% 8,276 86,945 45,000 48,290 $13.80
Warehouse/
31,601,201 18.7% 0.7% 19.5% 13.5% 12.6% 355,897 512,853 2,737,959 3,634,326 $8.59
Distribution
INDUSTRIAL TOTALS 37,797,329 15.6% 0.8% 16.4% 12.1% 11.2% 368,173 616,341 2,782,959 3,682,616 $10.76
Retail
Willis
149 105 Lake
Conroe

RETAIL TOTALS
Cleveland
11,737,720 7.6% 0.0% 7.6% 3.7%
105 4.0% 47,634 81,208 20,500 12,500 $14.89
Conroe 105

*For office and medical office, asking rates are gross; for industrial and retail, asking rates are NNN.
149

1488
242

1488 Magnolia 321

Submarket Map
The Woodlands

Tomball
2920

2920

Waller 2920 Spring Dayton

Kingwood
Hockley

Humble
Cypress
Atascocita
IAH Lake
Houston

Crosby

D
CB
n
to
us
Mont Belvieu

Ho
To
W Airport Blvd

Katy
Brookshire
330

Dulles Ave
CBD Ship
Channel Baytown
225
Bellaire Trinity Bay
University Blvd

Pasadena St
qua
La Porte W Fu

146

HOU Cartwright Rd W Airport Blvd

E Fort Bend EFD Clear Lake

Richmond - Sugarland
Pearland

35

League City

Alvin Galveston Bay

Texas E Fort Bend - Sugar Land Texas

City E Fort Bend - Sugar Land
Hitchcock

Fort Bend Team Galveston

Gulf of Mexico

Kolbe Curtice, CCIM, CLS Jim Pratt Barkley Peschel, CCIM Jason Scholtz
Principal Principal Principal Senior Vice President
281 269 3441 713 830 2147 281 242 2300 281 269 3444
kolbe.curtice@colliers.com jim.pratt@colliers.com barkley.peschel@colliers.com jason.scholtz@colliers.com

FOR MORE INFORMATION

Patsy Fretwell William Uhalt Copyright © 2023 Colliers
The information contained herein has been obtained from sources
Research Director Research Manager deemed reliable. While every reasonable effort has been made to
Houston Houston ensure its accuracy, we cannot guarantee it. No responsibility is
assumed for any inaccuracies. Readers are encouraged to consult
+1 713 830 2125 +1 713 830 2137 their professional advisors prior to acting on any of the material
contained in this report.
patsy.fretwell@colliers.com william.uhalt@colliers.com