**Houston Office Absorption on the Rise in Mid-2025**
Houston’s office market has shown signs of recovery, recording positive net absorption for the first time in a year. During the second quarter of 2025, the city posted 348,414 square feet of positive net absorption, bringing the year-to-date total to 286,575 square feet.
This turnaround is largely driven by a continued “flight-to-quality” trend among tenants, who are increasingly favoring Class A office properties. Class A buildings alone recorded 313,363 square feet of net absorption during the quarter, according to data from Colliers.
Danny Gray of Colliers noted, “Houston’s office market turned a corner in Q2, posting its first net absorption rate in a year and pushing year-to-date totals into positive territory.”
Despite the positive traction in absorption, leasing volume has slowed. Total leasing activity in the second quarter reached 2.2 million square feet, which represents just 17.9% of the volume seen in the previous quarter and 47.8% compared to the same period last year.
The overall vacancy rate showed improvement, declining to 27.4%. This marks a slight improvement from the record-high vacancy rate of 27.9% reported in the past two quarters, and a drop from 27.5% a year ago.
Construction activity in Houston’s office market remains limited. Average asking rents for Class A space dropped to $33.20 per square foot. Meanwhile, overall gross asking rents increased marginally from the previous quarter to $29.00 per square foot but are still lower compared to the same period last year.
Houston’s office sector is showing cautious optimism as the market finds stability in quality-driven demand and gradual improvements in key performance indicators.
