New report: Texas 2019 CRE outlook positive 
 

By David Jones, senior editor, Real Estate Center at Texas A&M University
March 1, 2019/Release No. 07-0319

COLLEGE STATION, Tex. (Real Estate Center) –  Commercial real estate’s 2019 outlook is positive, although overall Texas economic activity is expected to slow as weakening U.S. and world economies suppress oil prices at about $50 per barrel.
 
Past, present, and future commercial real estate activity in the state’s four major metropolitan areas is detailed in the first Texas Quarterly Commercial Report from the Real Estate Center at Texas A&M University. The free report is available for download on the Center's website.
 
Here’s what Center researchers foresee this year for CRE in the four major Texas metros.

  • Austin’s commercial sector will register low vacancy rates and asking rent growth.  
  • In the Dallas-Fort Worth office market, vacancy rates will increase, driving down rent growth, and to a lesser degree, the retail and warehousing markets will follow suit.
  • The Houston office market seems to have reached a bottom, and positive rent growth is expected. Retail and warehouse will maintain low vacancy rates and strong asking rent growth.  
  • San Antonio’s office market will register positive asking rent growth, as will the retail market. In contrast, San Antonio’s warehouse market could register flat or negative rent growth.  

“The outlook for 2019 is positive for the major Texas MSAs due to the strength of the U.S. and Texas economies,” said Research Economist Dr. Luis Torres. “Although oil prices dipped in late 2018, fundamental factors provide a favorable tailwind moving forward. Interest rates could start to rise again if there is evidence of inflation."
 
On the negative side, researchers said volatility in the oil market, a slowing global economy, and a declining trade environment remain the greatest headwinds to the Texas economy, challenging some of the state's most productive industries.
 
“Although Mexico, Canada, and the U.S. announced an unofficial trade agreement, the net impact of the proposal is uncertain. The U.S. economy may slow in 2019 as the effects of the 2018 fiscal stimulus are diluted," said Torres.

Subscribe to the free quarterly CRE report here

Funded primarily by Texas real estate licensee fees, the Real Estate Center was created by the state legislature to meet the needs of many audiences, including the real estate industry, instructors, researchers, and the public. The Center is part of Mays Business School at Texas A&M University.
 

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Real Estate Center
Gary Maler, 979-845-9691 (director)
Dr. James Gaines, 979-845-2079 (chief economist/residential)
Rusty Adams, 979-845-2007 (legal)
Dr. Ali Anari, MAnari@mays.tamu.edu (econometrics)
Dr. Charles Gilliland, 979-845-2080 (rural land)
Dr. Harold Hunt, 979-847-9021 (commercial)
Dr. Luis Torres, 979-845-7972 (econometrics)
 
For information on the Real Estate Center, contact Senior Editor David S. Jones at 979-845-2039 (voice), 979-845-0460 (fax) or d-jones@tamu.edu. Or contact Managing Editor Bryan Pope, 979-845-2088 (office) or b-pope@tamu.edu