The State of the Texas Office Market
Texas’s major office markets sent a consistent signal in Q2 2026: demand is healing, but at different speeds. DFW led the pack with vacancy dropping below 20% for the first time in three years and rents rising; Austin showed gradual stabilization with softer rents cushioning still-positive absorption, and Houston held resilient despite a slowdown in leasing, buoyed by continued flight-to-quality and a strengthening corporate base.
Austin Stabilizing, but leasing momentum cooling
- Vacancy down to 20.6% (from 21.2% Q1), below year-ago levels
- Net absorption positive at 735.3k SF, but softer than Q1’s 1.1M SF
- New supply jumped to 279.3k SF; 459k SF under construction
- Asking rents softened to $44.79/SF overall ($54.88/SF Class A)
- Northwest submarket led absorption (1.46M SF YTD); CBD posted negative absorption
- Notable deals: Texas Capital Bank (27,012 SF), Ryan LLC (24,532 SF); $197/SF Northwest sale
Download the Austin Office Market Report | Q2 2026
Dallas-Fort Worth: Strongest quarter in years
- Vacancy fell to 19.9% — first time below 20% in nearly three years
- Net absorption surged to 1.4M SF, up from 444.4k SF in Q1
- New supply modest at 173.1k SF; 3.1M SF under construction
- Sublease space contracted to 7.3M SF
- Asking rents climbed to $34.01/SF overall ($38.93/SF Class A)
- Notable deals: Mercury One (172,230 SF), Stellantis Financial (83,278 SF)
Download the DFW Office Market Report | Q2 2026
Houston — Resilient despite softer leasing
- Vacancy flat at 27.7%; leasing volume down 23% QoQ
- Net absorption still positive at 425k SF, offsetting Q1’s decline
- Class A captured 60%+ of leasing activity (flight-to-quality continues)
- Construction pipeline shrank to 127.7k SF (just one project, Autry Park)
- Asking rents up modestly to $31.35/SF
- Katy Freeway East led activity: Dow Chemical (203k SF), Superior Energy (56,256 SF)
- Tailwind: Expand Energy’s planned HQ move from OKC could push Houston to No. 2 in Fortune 500 count
Download the Houston Office Market Report | Q2 2026
