April 18, 2018
By: Mark Raines, senior vice president, JLL Houston
In the face of national closures and negative headlines, Houston’s retail market remains stable, healthy and poised for further growth.
Total vacancy decreased to 5.4 percent in the first quarter and the market saw 1.24 million square feet of positive net absorption to start the year.
Two retail categories, in particular, continue to expand across Houston: discount retail and grocery.
Discount retailers are in expansion mode. In fact, many see an opportunity to claim desirable retail spaces in tight urban submarkets as other big-box retailers falter. Retailers like Dirt Cheap and Ollie’s Bargain Outlet are gaining footholds in the Houston area. Other national discount brands such as Macy’s Backstage and TJX continue to expand and fill vacant spaces as well.
While expansion has slowed slightly from 2016 levels, grocery remains one of the most active sectors in Houston’s retail market. Grocery brands are expanding both traditional footprints, as well as smaller and two-story prototypes for urban environments.
Retailers are looking to both innovative prototypes to squeeze into tight urban locations and to new retail corridors along the Grand Parkway, which continues to spur retail development particularly along its newest northern sections. The north retail submarket saw approximately 353,000 square feet of completions and has approximately 849,000 square feet of space currently under construction – more than any other retail submarket.
Looking ahead, the metro’s retail market is expected to remain stable and healthy, with moderate growth projected for 2018.
View our full Q1 2018 retail market report here.
Read more about our retail report in Bisnow.
About the Author
Mark Raines is a Senior Vice President and the Retail Brokerage lead for JLL Houston. In his role, Mark focuses on delivering strategic and innovative real estate solutions that produce superior results and create exceptional value for clients. Mark has more than 15 years of commercial real estate experience and is a member of the International Council of Shopping Centers (ICSC).