Parks and streetscapes benefit landlords and tenants
It was 2004 when a group of bold leaders from Westchase District met in a board retreat to go through a visioning exercise to imagine what Westchase District might look like 20 years down the road. As a result of that exercise, the Westchase District Board of Directors established the following Vision Statement: “The Westchase community is a vibrant living and working community, with a high-quality downtown. The Westchase community is perceived by residents as the safest in the region and has the highest (measured) mobility level in the region. The community is known for having entertainment/recreation amenities, and there are inter-connecting hiking, biking, and pedestrian ways, linking a set of community gathering areas.”
Since that vision statement was adopted by the board in 2004, it appears on the District’s website and at the bottom of every board meeting agenda, serving as a constant reminder of the Board’s vision.
Parks and greenspaces
This fall, Woodchase Park — the area’s first, fully programmed park — will open at 3951 Woodchase Drive. Woodchase Park features a fenced dog park, children’s play area with a misting feature and climbing wall, a community garden, walking paths and exercise stations, plus a pavilion with restrooms and a covered patio available for events. The park will have a soft opening in early October, with weekly activities that include adult exercise classes, a children’s mobile library, and art and music activities for kids. Ten days of grand opening festivities will begin on Thursday, October 28, including a ribbon-cutting ceremony with Mayor Sylvester Turner. Click to read more at www.rednews.com.
Texas Medical Center breaks ground on $1.8 billion TMC3 life sciences campus. Texas medical center
VACANCY AT 18% Overall vacancy for medical office space in the Houston market is at 18.0%, up 20 basis points from 17.8% this time last year. Office medical space has recorded more than 1 million sq. ft. of leasing activity year-to-date—which is comprised of both new leases and renewals—while net absorption (move-ins minus move-outs) is at negative 344,000 sq. ft. So far this year, developments under construction stand at 880,000 sq. ft. One 48,000-sq.-ft. property has delivered in 2021. The average asking full-service rent is at $26.68 per sq. ft., up 3.8% from last year at this time, while Class A medical office space is averaging $32.36 per sq. ft., up 7.7% from the prior period at $30.04 per sq. ft.
$1.8 BILLION LIFE SCIENCES CAMPUS BREAKS GROUND The Texas Medical Center has broken ground on phase one of the 37-acre TMC3 that includes 950,000 sq. ft. of research space anchored by a 700,000-sq.-ft. facility focused on life sciences. Also included is the 150,000-sq.-ft. TMC3 Collaborative Building, a 521-room hotel with 65,000 sq. ft. of conference space, a 350-unit residential tower, and 18.7 acres of double-helix-shaped public park space. Phase one is expected to open in fall 2023, while the launch dates of additional phases of TMC3 are still being decided. It is reported that when fully built out, the TMC3 campus will total 6 million sq. ft. of development. The campus is expected to generate up to $5.4 billion in annual economic growth for Texas, as well as 42,000 new jobs. Click to read more at www.naipartners.com.
Belvoir Real Estate Group, LLC in late August completed the sale of a multi-tenant industrial facility at 430 E. Helms Road. The unique property features a 36,000-square-foot building with a mix of warehouse and office space. With an en suite bathroom for each tenant space, 30 overhead doors and two acres of laydown yard, the versatile space offers opportunities for any industrial occupier. Meanwhile, its strong cash flow makes it an ideal investment property. Belvoir’s Kyle Fischer represented the seller in the transaction, while Fairbanks Industrial, LLC purchased the property.
A joint venture between Lowe and an institutional investor announced today its acquisition from The Howard Hughes Corporation® (NYSE: HHC) of three hospitality assets located in The Woodlands®, a 28,500-acre award-winning master planned community in the greater Houston area. The Woodlands Resort; The Westin at The Woodlands; and Embassy Suites by Hilton, The Woodlands at Hughes Landing were purchased for $252 million and will continue to be managed by Lowe’s hospitality management subsidiary, CoralTree Hospitality, which took over management of the properties in September of 2020. Lowe will immediately begin a $25 million capital investment program at the three hotels, totaling 909 rooms.
“The Woodlands hotel portfolio acquisition is consistent with our broader hospitality investment strategy that targets quality, full-service hotels and resorts that draw significant leisure travel, but also cater to corporate and group business. Located in a high-growth Houston submarket with strong demand and compelling demographics, the hotels and resort draw from multiple demand segments attracted by the appealing location, lakes, outdoor recreation and considerable amenities within The Woodlands. Business has grown steadily over the past five years and the hotels have weathered the downturn and are rebounding strongly,” said Mike Lowe, co-CEO of Lowe.
With this sale, Howard Hughes has successfully closed on approximately $376 million of the targeted $600 million net proceeds in the sale of non-core assets outlined two years ago. “The sale of our hotel assets in The Woodlands further advances the disposition of non-core assets as outlined in our 2019 strategic initiative,” said David R. O’Reilly, CEO of The Howard Hughes Corporation. “Lowe is recognized for its leading quality service within the hospitality industry, and we are pleased to have found a buyer who shares our commitment to providing visitors to The Woodlands with a best-in-class customer experience.”
While the Houston office market has had a rough 12 months, and will likely to continue to lag in the coming quarters, the industrial market is booming. In fact, the industrial market in Houston is so strong that the metro area has hit the highest quarterly leasing total on record, according to a recent report from NAI Partners.
By the end of the second quarter of this year, Houston’s overall industrial vacancy rate stood at 9%, more or less unchanged since the previous quarter, however, there were 12.5 million square feet of leasing activity recorded for Q2 of 2021, which is more than double the 6 million square feet of leasing activity during the same period last year. A wave of new deliveries from previous quarters has kept inventory levels stable and average gross rent rates relatively flat.
The news is significant for numerous reasons, but namely how the industrial market is helping bolster the broader commercial real estate sector as other asset classes continue to struggle since the start of the pandemic. But other economic indicators continue to show improvement, the report reveals, such as lower unemployment stats, the increase in drilling operations, and an uptick in new construction. Click to read more at www.rednews.com.
Like the fabled Tower of Babel, Houston’s newest megachurch knocked down one of the city’s more recognizable pieces of architecture over the weekend.
Demolition crews were spotted tearing down the Shadowdale grain elevators near the intersection of Interstate 10 and Beltway 8 recently, according to Reddit user u/astrosdude91. The site will be transformed into Hope City Silos, a campus of the non-denominational Hope City Church which currently operates several small campuses around Houston.
One of the two structures will be spared and used as a “branding opportunity” for the church. I can only imagine the daily dose of religious inspiration in store.
Church donors spent nearly $20 million acquiring the silos and the 17-acre site located at 1140 Lumpkin Street. That doesn’t include the cost to build the campus itself.
The new campus is in part being developed by Big Vision Advisors’ Duncan Dodds, who also helped transform the Compaq Center into Lakewood Church in the mid-2000s, according to the Houston Chronicle’s Nancy Sarnoff. Click to read more at www.chron.com.