CRE Pipelines Slowing Nationally; North Houston District Bucking the Trend

If you’ve been keeping up with commercial real estate (CRE) news, you know the market has faced some challenges lately. Higher interest rates, supply chain issues, and too much building in some sectors have caused a slowdown in real estate. Industrial, multi-family, retail, and hospitality properties have all been affected. (The office market is a different story—thanks to remote work—but that’s a topic for another day!)

Permitting, construction starts, and completed projects are all down compared to just a few years ago. In short, the real estate pipeline is shrinking.

Let’s take the industrial sector, for example. In 2022 and 2023, more than 1.5 billion square feet of industrial projects were completed, making it the largest two-year building boom in over 50 years. But CoStar data shows that by the end of 2023, completions took a steep dive, and new starts hit their lowest point in 10 years. This trend has spread across other sectors too. In multi-family, for instance, investment in apartment buildings dropped 24% from Q4 2023 to Q1 2024 and is down 86% from its peak in 2021.

But here’s the silver lining: when supply drops but demand remains steady, existing spaces eventually fill up, stabilizing vacancies and pushing rents higher. And when rents rise, it usually makes for a perfect time to bring in new supply.

This brings us to the North Houston District, where the story takes a bit of a twist. While many areas are hitting pause on new construction, we’ve got three major industrial projects in the works, all set to deliver in the next year or so. These projects include:

• Provident Industrial’s Imperial Valley Industrial Park – A two-building, 378,980-square-foot development at 309 Aldine Bender.
• Griffin Partners’ Carter Crossing – A 131,171-square-foot warehouse at 1444 Greens Parkway.
• Vigavi and Principal’s 410 West Rd – A 728,080-square-foot cross-dock facility in Pinto Business Park, the largest industrial development in the District.

In total, more than 1.2 million square feet of new industrial space will be added to the area. If the current trends continue, these developments will be opening into a highly favorable leasing environment in 2025.

This growth reinforces the North Houston District’s position as a top destination for industrial development—where location and access truly intersect.