Commercial Vacancy Rate
Strong Local Economy
Status Indicators: Proceeding as Anticipated | Monitoring Progress | Reviewing for Improvement | Information Unavailable
Proceeding as Anticipated
Reviewing for Improvement
Please note that Q1, Q2, Q3, and Q4 refer to the first, second, third, and fourth quarters of the Fiscal Year. The City’s Fiscal Year runs from October 1st – September 30th and is denoted by FY.
Overall, the City is maintaining its overall goals for commercial vacancy and narrowly missed its target for office space. Results for this quarter show that the City is maintaining its overall commercial square footage in industrial, retail, and office vacancies. Sugar Land’s corporate diversification has continued to reinforce its strong performance in the commercial real estate market. Retail space had minimal increased vacancy results, while occupancy in the industrial sector continues to demonstrate the need for added light industrial square footage in the future.
- Sugar Creek on the Lake: 164,926 sf available with 62,457 sf contiguous on the 4th floor
- Sugar Creek II: 100,881 sf available for lease (not all vacant) with 52,984 contiguous on the 4th and 5th floors
- Lake Pointe Plaza/One Fluor Daniel: 85,927 sf available for sublease on the 2nd and 3rd floors
- Texas Drive Building: 58,279 sf available with 24,897 contiguous sf sublease space on the 5th floor
Office vacancy has decreased slightly although it is still above the 10% goal. It is important to note that despite being above 10% Sugar Land only has three spaces that would truly accommodate a significant user requiring 50,000 square feet or greater. Despite this vacancy rate Sugar Land’s office market continues to be one of the best performing in Houston’s submarkets which has been attributed to the community’s diverse tenant base and strong economic development program.
Percentage of current capacity not occupied by tenants in Office, Industrial, and Retail commercial space within the City of Sugar Land.
The target is set at less than or equal to 10%, which is considered a sensible target equilibrium in the occupancy of commercial space.
Too little space available presents as much of a challenge as the underutilization of commercial space, and both extremes also would likely cause negative impacts to the market prices for commercial space. In the future, comparing performance against regional economic competitors like The Woodlands and the Energy Corridor presents an opportunity to gain additional value from tracking the performance of this measure.
Strong occupancy rates in Office, Industrial, and Retail commercial space ensure that Sugar Land remains a vibrant regional business hub and promote the continued economic success of the community.