Category: Editorial

Shopping and Shipping: Every Click of E-Commerce Drives Distribution Market

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By Cynthia Lescalleet

Industrial market expectations for distribution-style space as 2018 kicks off are a lot like what 2017 delivered: Escalating e-commerce volume and supply chain management practices that seek “last mile” proximity are driving demand and development, reports a sampling of Texas industrial experts.

Here’s why: Online shopping. E-commerce accounted for 25 percent of leasing in 2017, up from 14.7 percent a year ago, according to JLL’s “US Industrial Outlook 2017, 3Q.”

With leasing activity and absorption up, construction has followed. In both speculative and build-to-suit projects, the wide open spaces of Texas are now inside new properties; they’re super-sized and locating a bit farther out of established markets to optimize investment, bypass congestion as urban density rises, and participate in the “last mile” delivery concept that is defining the logistics of quickly moving and efficiently storing goods. Infill locations –with adequate truck parking –is also seeing some activity.

While in Texas these trends echo national ones, here is how major markets shaped up in 2017 and where they might be heading in 2018:

Opening Up Office in 2018

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By Brandi Smith

When it opens its doors in 2019, Skanska’s Capitol Tower will reach 35 stories into the downtown Houston skyline, offering up 775,000 square feet of Class-A office and retail space. Six and a half floors of the sustainable building, totalling 210,000 square feet, will be occupied by Bank of America.

“That was by far the most unique deal I worked on in 2017,” says Kristen Rabel, senior vice president of CBRE Houston. “It was exciting to work with a large tenant and get them to understand the vision of Capitol Tower.”

She, along with CBRE’s Warren Savery and Rima Soroka worked on the deal that ultimately triggered Skanska to kick off construction and bring Capitol Tower out of the ground.

Property Tax Reductions: Senate Bill 1 and Hurricane Harvey

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REDNews Interviews Senator Paul Bettencourt for an update

BY MICHAEL PAVIA

Senate Bill 1
Senate Bill 1 (SB 1), is proposed legislation allowing for property tax rate elections if county property tax revenues exceeded 4% of what was taken in the year before. Basically, as values go up,
SB1 proposes to roll back tax rates to provide property tax relief. SB1 proposed to decrease the rollback rate from the current 8% to 4%. The Texas Senate endorsed SB 1. Members from the Texas
House and Senate met in a special session on July 26th to vote on the rollback. According to Senator Bettencourt, Speaker of the House Joe Straus was unwilling to appoint a conference committee so the bill was defeated.

Per Lieutenant Governor Patrick, “Whenever the Senate convenes again, either a special or regular session, it is our intention to pass that bill one more time. There will be a lot of reform measures
associated with it, as well. Governor Abbott is supportive and is hopeful that it will pass.”

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Marines on a mission: Cullen Realty celebrates ranch sale

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BY BRANDI SMITH

Jason Shaw still remembers the first time he visited Cullen Ranch, a 3,284-acre property in Liberty County. The retired U.S. Marine had been invited out for a veterans hunt, an event hosted by Meredith Cullen, a Marine himself.

“It was amazing to go out as a veteran to shoot quail. I had never even seen a quail,” Shaw laughs. “When I got out there, I was in awe. I thought, ‘Oh, my God.What is this place?’”

The two connected there in 2009 and, just a few years later in 2013, formed Cullen Realty Group. The sale of Cullen Ranch is one of the firm’s biggest deals.

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Texas ICSC Recap:Trends & Evolution of Mixed-Use Developments

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BY DAVID SCHNITZER, CCIM

For this year’s Texas International Council of Shopping Centers (ICSC) Conference and Deal Making show inNovember, I had the pleasure of speaking with four of the state’s most active developers. Our topics ranged from discussing the trends of mixed-use to its evolution and where it may be headed.

We were privileged to have with us Mark Bulmash, Senior Vice President of Development for The Howard Hughes Corporation; Walt Mountford, Executive Vice President of KDC; Paris Rutherford. Paris is Principal of Catalyst Urban Development and Bill Burton, Executive Vice President at Hillwood Properties, Hillwood Urban.

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Real Estate and the Chinese: How to successfully work with Chinese real estate investors

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BY PIUS K LEUNG

Chinese citizens are the top foreign buyers of homes in the U.S. According to a recent report by the National Association of Realtors (NAR), Chinese buyers have been the top foreign buyers of U.S. residential property for three straight years. As a group, they surpass top buyers from Canada, the U. K., Mexico, and India. Between April 2016 and March 2017, Chinese buyers purchased more than 40,500 housing units—this is a 40% increase compared to the same period the year before. The units purchased between April 2016 and March 2017 were worth a total of $31.7 billion. This is a 16% increase compared to the purchased value between April 2016 and March 2016. Texas, Virginia, Florida and Indiana have become top destinations in 2017 because Chinese buyers are looking beyond just California and New York.

Besides buying residential properties, according to Rosen Consulting Group, Chinese investors acquired at least $17.1 billion in commercial properties. Although 70% of investments are concentrated in the New York, Los Angeles and San Francisco areas, the remaining volume of investment has spread throughout the rest of the country.

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