HOUSTON – Energy firms are putting excess Houston office space on the market for sublease following layoffs and pullbacks in their exploration plans, says Dan Boyles, a partner in the NAI Partners realty firm.
Three companies, Statoil, BP and WorleyParsons engineering, are putting a total of 1 million square feet of their Houston office space on the market to be leased by other firms as sublease space.
Mergers and acquisitions, including the huge Halliburton/Baker Hughes combination, will also result in office space being put back on the market for sublease, Boyles says.
However, the fundamentals of the Houston office market are healthy. NAI reports year-end Class A vacancy was a low 9.5 percent, down from 14 percent in 2010. Class A rent was up almost 6 percent last year, NAI reports.
Although the rapid fall in oil prices shocked Houston last fall, energy company decision-makers “are not panicked” NAI’s Jon Silberman, co-managing partner, said at the firm’s media breakfast last week.
“It’s not as catastrophic as people may think,” Silberman said.