Not to be crude, but Oklahoma City and Houston, we have a problem

CoStar Group found gloom in Oklahoma City and doom in Houston when it looked at the effect of collapsed crude oil prices on the demand for leased office space.

Two other big energy-affected metro areas, Dallas-Fort Worth, and Denver, won't hurt much because they're more diversified, CosStar reported.

"Houston and Oklahoma City are more exposed to the oil and gas industry. Between these markets, Houston has the largest concentration of oil and gas tenants, accounting for nearly 22 million square feet of 4&5 Star space absorbed since 2010, about 2.4 times the amount of space taken in Dallas-FW, Denver, and Oklahoma City combined. Oklahoma City, the smallest of these energy markets, has seen oil & gas tenants absorb over 32% of 4&5 Star office space since 2010," CoStar said.

The worst-case scenario for Oklahoma City has vacancies across the best buildings doubling from 15% now to nearly 30%, according to CoStar, based in Washington, D.C.

CoStar used its own building rating system in its study.

• 5 Star: "A 5-Star office building is exemplary of a state-of-the-art, category defining structure that represents the latest trends and quality in design and construction, prominent in its context or of a landmark status, and very likely a certified sustainable and energy efficient building. Buildings rated to exhibit the nation’s current set of highest quality structures and form the benchmark of current excellence in office buildings."

• 4 Star: "A very high quality building that maintains market leadership through the strength of its initial construction, continual above average maintenance and desirability for tenants and investors over time. These buildings are likely to be older than the current 5 Star set."

CoStar said Houston saw office vacancy rates rise 4 percentage points during the Great Recession and 7 percentage points during the oil price slide of 2014-2016, but "is set to face an unprecedented rise in vacancies this time around, potentially leaving one quarter of 4&5-Star office space vacant."

Office usage in Dallas-Fort Worth and Denver is more varied, and it shows in the stats, according to CoStar.

"The Dallas-FW office vacancy rate is the least impacted relative to the major energy markets, only rising from 18% currently to 19% in the worst-case scenario. Denver, with the lowest overall 4&5-Star vacancy rate among these markets, could see a slight rise in vacancies of 2.5 percentage points in the worst-case scenario but would still retain the tightest vacancy rate across the four metros."

Comparing not-so-lil-ol' Oklahoma City, population 655,057, to Houston, population 2.3 million, isn't quite as crazy as it seems when the historic-economic kinship of the oil business is taken into consideration. Plus we should probably get ready for more comparisons with bigger cities, and more caveats. In case you missed it, Oklahoma City is now the 25th largest city in the United States, up six spots since 2010, according to the Census Bureau.

Things change. Population isn't everything. Tulsa used to be known as the Oil Capital of the World, and CoStar didn't even look that direction.

Email Real Estate Editor Richard Mize at rmize@oklahoman.com.