Houston ranks No. 2 in America for office vacancies, study finds

report

Why go into the office when your job can be completed from home? Photo via Getty Images

Anew study of the office rental market in the U.S. has revealed Houston has the second highest rate of office vacancies nationwide. In fact, the total square footage of Houston’s empty office space adds up to 1,153 football fields.

The report by Indian service provider Outsource2India discovered 18.6 percent of all office space in Houston is sitting empty, a figure that has grown by 1.6 percent since 2023.

To put the football fields comparison into perspective, that means about 1,522 acres of office space around the city is sitting empty, or nearly 66.30 million square feet.

Rent prices for office space around the U.S. has largely remained unchanged, the report says, except for a very slight uptick in Houston and Austin. Rent prices have gone up just one dollar since the last year to $30 per square foot in Houston, and $44 in Austin.

It's not hard to see why so many offices are sitting empty, especially considering the rising demand (and popularity) of remote and hybrid professions since the COVID-19 pandemic. In a 2020 analysis, Forbes said companies prioritizing the "remote work revolution" saw an increase in teleworker productivity, performance, engagement, retention, and profitability. In 2024, secondary benefits of flexible work environments include smaller carbon footprints, more women in the workplace, reduced operating costs, and more.

Outsource2India suggests major businesses in cities like Houston will need to reimagine their work culture and office spaces in order to compete with flexible work models.

“As remote work continues to reshape workplace dynamics, there is a pressing need for this market to evolve and adapt,” the report said.

After all, Houston commutes aren't getting any easier, and more workers are starting to look for less commute-heavy vocations in suburbs with top job markets.

San Francisco was the only U.S. metro area with a higher office vacancy rate than Houston, at 21.7 percent. However, the actual square footage of empty office space in the city only adds up to 721 football fields, or nearly 952 acres of space.

Elsewhere in Texas, Dallas-Fort Worth has the third highest office vacancy rate in the nation, at 18 percent, followed by Austin with a 16.7 percent vacancy rate. According to the study's football field comparison, the total square footage of empty office space in Dallas and Austin equals 1,328 and 392 football fields, respectively.

The top 10 metro areas with the highest office vacancy rates are:

  • No. 1 – San Francisco, California
  • No. 2 – Houston, Texas
  • No. 3 – Dallas, Texas
  • No. 4 – Austin, Texas
  • No. 5 – Washington, D.C.
  • No. 6 – Chicago, Illinois
  • No. 7 – Denver, Colorado
  • No. 8 – Phoenix, Arizona
  • No. 9 – Los Angeles, California
  • No. 10 – San Jose, California

Outsource2India tracked office rent prices in major U.S. metropolitan areas for 2023 and 2024 to discover the top 10 metro areas with the highest office vacancy rates using data from the National Association of Realtors (NAR).

The full report can be found on outsource2india.com.

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This article originally ran on CultureMap.

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Fast-growing Houston-based geothermal energy co. secures $255M in additional funding

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A Houston company that's responding to rising energy demand by harnessing geothermal energy through its technology has again secured millions in funding. The deal brings Fervo's total funding secured this year to around $600 million.

Fervo Energy announced that it has raised $255 million in new funding and capital availability. The $135 million corporate equity round was led by Capricorn’s Technology Impact Fund II with participating investors including Breakthrough Energy Ventures, CalSTRS, Congruent Ventures, CPP Investments, DCVC, Devon Energy, Galvanize Climate Solutions, Liberty Mutual Investments, Mercuria, and Sabanci Climate Ventures.

The funding will go toward supporting Fervo's ongoing and future geothermal projects.

“The demand for 24/7 carbon-free energy is at an all-time high, and Fervo is one of the only companies building large projects that will come online before the end of the decade,” Fervo CEO and Co-Founder Tim Latimer says in a news release. “Investors recognize that Fervo’s ability to get to scale quickly is vital in an evolving market that is seeing unprecedented energy demand from AI and other sources.”

Additionally, Fervo secured a $120 million letter of credit and term loan facility from Mercuria, an independent energy and commodity group that previously invested in the company.

“In surveying power markets across the U.S. today, the need for next-generation geothermal is undeniable,” Brian Falik, group chief investment officer of Mercuria, adds. “We believe in Fervo not just because their EGS approach is cost-effective, commercially viable, and already being deployed at scale, but because they set ambitious targets and consistently deliver.”

In February, Fervo secured $244 million in a financing round led by Devon Energy, and in September, the company received a $100 million bridge loan for the first phase of its ongoing project in Utah. This project, known as Project Cape, represents a 100x growth opportunity for Fervo, as Latimer explained to InnovationMap earlier this year. As of now, Project Cape is fully permitted up to 2 GW and will begin generating electricity in 2026, per the company.

Other wins for Fervo this year include moving into its new headquarters in downtown Houston, securing a power purchase agreement with California, growing its partnership with Google, and being named amongst the year's top inventions by Time magazine.


Investors from Houston, Boston fuel Greentown with $4M commitment

seeing green

Greentown Labs, a climatetech incubator with locations in the Houston and Boston areas, has announced it has received funding from a mix of investors.

The $4 million in funding came from both of the Houston and Massachusetts locations. Houston investors included Bobby Tudor, CEO of Artemis Energy Partners and chairman of the Houston Energy Transition Initiative; David Baldwin, co-founder of OpenMinds and TEX-E and partner at SCF Partners; and Rice University. Other investors included MassDevelopment and the City of Somerville.

“The challenges of the energy transition are immense, and the role played by technology incubators like Greentown Labs is essential,” Tudor says in a news release. “We believe this role, which is a partnership between academia, industry, philanthropists, entrepreneurs, and governments, is the best way to get to effective, scalable solutions in a time frame that the urgency of the challenge requires. We need all hands on deck, and this partnership between Massachusetts and Texas can be a role model for others.”

According to Greentown, the funding will support its financial position and contribute to preparing the incubator for its next chapter of supporting its its leadership team prepare for Greentown’s next chapter supporting and growing its 575 startups.

“Greentown’s mission aligns closely with the Houston Energy Transition Initiative’s goal of accelerating global solutions to address the dual challenge of meeting growing energy demand globally while also significantly reducing CO2 emissions,” adds Steve Kean, president and CEO of the Greater Houston Partnership.

With the announcement of the funding, Greentown named its board members, including Tudor, who will serve as Greentown Labs Board Chair. The other Houston-based board members are:

  • David Baldwin, co-founder of OpenMinds and TEX-E; partner atSCF Partners
  • Bob Harvey, former president and CEO of GHP; board member of TEX-E
  • Jane Stricker, senior vice president of energy transition and executive director of HETI

“With this new funding, Greentown is poised to expand its impact across its existing ecosystems and support even more climatetech startups,” adds Kevin Dutt, interim CEO of Greentown Labs. “We believe in the essential role entrepreneurship will play in the energy transition and we’re grateful for the support of our partners who share in that belief and our collective commitment to commercializing these technologies as quickly and efficiently as possible.”

According to Greentown, the incubator plans to announce its new CEO in the coming months.

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This article originally ran on EnergyCapital.

From hiring tips to AI's impact on the workforce, here's what guest columns were the most read in 2024

year in review

Editor's note: Every week, InnovationMap runs one or two guest columns written by tech entrepreneurs, public relations experts, data geniuses, and more. As Houston's innovation ecosystem gets ready for 2025, here are some of this year's top guest contributor pieces — each with pertinent information and advice for startups both at publishing and into the new year. Make sure to click through to continue reading each piece.

Is your New Year's resolution to start contributing? Email natalie@innovationmap.com to learn more.

How to avoid bad hiring decisions when it matters most, according to this Houston expert

Despite the inevitability of bad hires, recruiters equipped with proper tools and training can identify red flags and take preventive measures. Photo by Tima Miroshnichenko from Pexels

Written by Karen Leal, performance specialist with Houston-based Insperity, a provider of human resources offering a suite of scalable HR solutions available in the marketplace.

Hiring the right people for the right roles is ideal and can make an organization reach new heights. The reality is every business has made a bad hire.

Finding the wrong fit for a team or organization is not uncommon, but it is important to know what it costs the organization, which can be detrimental to company finances and its workplace culture, especially small businesses and startups where the impact is magnified.

The U.S. Department of Labor reports a bad hire can cost up to 30 percent of the employee’s wage, which would be approximately $18,000 since the average American wage is $60,000. In addition, there are soft costs of managers and leadership time during the hiring and training process, which adds up quickly. Continue reading.

How AI is changing product management and what you need to know

A product management expert shares how artificial intelligence is affecting the process for the tech and startup worlds. Photo via Getty Images

Written by Natasha Gorodetsky, founder and CEO of Product Pursuits, a Houston company that helps early stage and venture-backed startups build products and create impact.

For the past 14 months, everyone has been talking about ways artificial intelligence is changing the world, and product management is not an exception. The challenge, as with every new technology, is not only adopting it but understanding what old habits, workflows, and processes are affected by it.

Product managers — as well as startup founders leading a product function — more than any other role, face a challenge of bringing new life-changing products to market that may or may not be received well by their users. A product manager’s goal is complex — bring value, stay ahead of the competition, be innovative. Yet, the "behind the scenes" grind requires endless decision making and trade offs to inspire stakeholders to move forward and deliver.

As we dive into 2024, it is obvious that AI tools do not only transform the way we work but also help product managers create products that exceed customer expectation and drive businesses forward. Continue reading.

Houston expert shares 3 ways to stay on top of employee mental health

Companies that intentionally focus on their employees’ mental well-being will reap the benefits of a happier, healthier workforce. Photo via Getty Images

Written by Dennis Yung, executive vice president and general manager at Skanska.

Conversations surrounding mental health have come to the forefront of business and is an imperative aspect that cannot be ignored by business leaders.

Approximately 20 percent of Americans, which is 50 million people (about twice the population of Texas), are experiencing a mental illness, 15 percent of Americans had a substance use disorder in the past year and nearly 5 percent, over 12.1 million adults, reported serious thoughts of suicide (Mental Health America). Notably, certain professions, such as construction, exhibit higher suicide rates, (CDC). With these staggering numbers, the foundation of workplace safety extends beyond physical well-being to encompass psychological health.

The landscape has undergone a transformation, stemming from the pandemic, and the stigma of mental health concerns and seeking help has loosened. Recognizing that September is Suicide Prevention Month, below are three ways businesses of every size can actively support the mental well-being of their employees. Continue reading.

Houston expert shares 3 business trend predictions for 2024

Here are predictions for what current and emerging trends will further shape businesses in 2024. Photo via Getty Images

Written by Bryce Lindner, senior vice president and market executive, commercial banking in South Texas at Louisiana at Bank of America.

Last year was a dynamic year for businesses across all sectors. Artificial intelligence went from a novel technology to a more widely utilized business productivity tool. Many companies invested additional resources in sustainable business practices. And digital business solutions helped companies thrive.

Here are predictions for what current and emerging trends will further shape businesses in 2024. Continue reading.

How this Houston innovator is using his personal connection to ALS fuel his fight for a cure

Daniel Barvin has a neurodegenerative disease in his near future. He joined Houston-based Coya Therapeutics to help fight for a cure to the aggressively deadly ALS. Photo via Getty Images

Written by Daniel Barvin, vice president of operations and patient advocacy at Coya Therapeutics.

We can never predict how our lives will turn out, but then maybe some of us can. Genetic testing showed that I, like my grandfather, aunt, uncle and father before me, would most likely die of amyotrophic lateral sclerosis, more commonly known as ALS, and/or frontotemporal degeneration (FTD) in my 40s.

Being 36, it’s possible that fear could have overtaken my life, but instead I chose to fight for every chance to change not only my life, but the lives of millions who are suffering or may one day suffer from neurodegenerative disease.

ALS is a rare disease that robs one of their ability to control their muscles, leading them to lose their ability to walk, talk and eventually breathe. Eighty percent of cases are sporadic (of unknown origin) and 20 percent have known genetic causes. Continue reading.

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