In a dramatic shift for America's energy capital, Houston's once-thriving corporate centres now stand eerily quiet, their abandoned desks and silent computer screens telling a story of industry transformation. The oil industry runs so deep in Texas culture that the series Landman, depicting roughnecks chasing fortunes in the oil business, has become a massive hit. Yet reality tells a different story.
The Great Consolidation: $450bn in Deals Reshapes an Industry
During 2023, a wave of major oil and natural gas consolidations totalling more than $450 billion in deals triggered widespread job cuts that left entire office floors deserted. According to Moody's Analytics, Houston has the highest percentage of people working in the oil industry among America's 20 largest metropolitan areas, making it particularly vulnerable to such industry shifts.
The consequences have been stark. By early 2025, Houston's office vacancy rate had soared to 27.9 percent, placing the metropolitan area behind only San Francisco for empty commercial space, Bloomberg reports. The haunting silence in these buildings contrasts sharply with their former buzz of activity from oil executives, engineers and energy traders.
Housing Market Feels the Pinch
The ripple effects have extended deeply into Houston's residential property market. Home sellers who can no longer afford their mortgage payments are desperately trying to offload properties, creating a surge in listings that has driven prices downward.
In September, Houston home prices recorded their largest year-over-year decline since 2023, according to CoStar data. The median Houston home price now stands at $261,730, representing a 3.2 percent decrease over the past year to September. While this presents opportunities for buyers, properties are taking longer to sell, spending an average of 44 days on the market.
This represents a significant shock for residents who witnessed Houston's pandemic-era property boom. Back in May 2021, home prices had surged by 11.9 percent year-over-year, and by 2022, properties were worth 16.6 percent more than pre-pandemic levels.
"Prices are beginning to tick downward as the market shifts from a seller's market to a buyer's market," observed Shae Cottar, chair of the Houston Association of Realtors (HAR), in comments to Newsweek.
Corporate Exodus and Urban Transformation
As consolidations transformed downtown into something resembling a ghost town, the newly merged companies raced to construct more modern buildings outside the city centre. The challenge now facing Houston, America's fourth-largest city, is determining how to repurpose these empty offices.
The problem is particularly acute for 1980s-era buildings that look and feel dated - relics of the last great oil boom. These structures constitute more than half of Houston's office stock and have proven the most difficult to fill.
Houston's lack of zoning regulations compounds the issue, encouraging outward expansion that has made the city centre increasingly less desirable. Furthermore, when oil prices spike, most companies prefer building brand-new towers rather than renovating older ones, as new construction often proves cheaper.
Specific corporate moves illustrate the trend. In September, Devon Energy Corp merged with Grayson Mill Energy and closed its enormous Houston office, relocating employees to the company's Oklahoma City headquarters. Company spokesperson Michelle Hindmarch explained the decision was "rooted in our belief that in-person, co-located collaboration is essential to our ongoing performance."
Exxon Mobil Corp, another major Houston employer, consolidated its Dallas and Houston offices into a new headquarters campus located 30 minutes north of downtown Houston. The vacated building met a dramatic end in June when a local shrimp and catfish festival auctioned off the right for someone to push the demolition explosion button.
The condo market has been especially hard hit. A recent Redfin report indicates Houston ranks second only to Florida in the severity of its condo crisis, with prices dropping significantly.
Houston realtor Tim Surratt summarised the new market reality to Fox 26 Houston: "A year ago, if the neighbour's house sold for $800,000, we'd ask for $840,000 for ours. Those days are gone. What your neighbour's house sold for, you have to price yours very similarly to that."
As Houston grapples with this dramatic transformation, the city faces the complex challenge of reinventing its urban core while supporting a housing market adjusting to new economic realities.
