How does current office construction in Houston compare to the 1980s boom?

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Current Office Construction in Houston is a Fraction of the 1980s Boom

Current office construction in Houston represents a significantly smaller scale compared to the boom experienced in the 1980s. While approximately 11 million square feet of office space is currently under construction, the 1980-1986 period saw developers build a massive 88.9 million square feet, a development that more than doubled the city's office market.
Scale of Development

The current wave of construction in Houston involves around 56 office buildings, totalling at least 11 million square feet. This figure, while substantial, pales in comparison to the 88.9 million square feet of office space constructed between 1980 and 1986. That earlier construction spree was so extensive that it more than doubled the city's existing office market capacity.
Economic Drivers and Consequences

Both the current construction cycle and the 1980s boom were heavily influenced by the oil and gas industry. However, the current surge is primarily driven by the US shale oil and gas revolution, which has expanded the workforce and increased demand for office space. In contrast, the 1980s boom was also tied to oil prices, but it was followed by a significant crash. A collapse in oil prices in the early 1980s led to a dramatic increase in office vacancy rates, which soared to nearly 30% in 1983 from 9.8% just two years prior, according to Reis.
Current Market Dynamics

Despite the historical parallels and the caution advised by economists, the current Houston office market is described as robust, with some banks even lending money for new buildings without requiring pre-leased tenants. Vacancy rates in the most expensive, modern office buildings have fallen to 6.9% in the second quarter, down from 12% two years earlier. The broader office vacancy rate stands at 14.2%, which is below the national average of 17%. This indicates a strong demand for space, fueled by job growth, with Houston adding 100,000 jobs last year and projected to add another 80,000 this year.

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How does current office construction in Houston compare to the 1980s boom?

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