Category: Southeast Texas Market Reports

52,000 Apartments Were Completed in Major Texas Cities Over the Last 12 Months

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Developers have invested $16 Billion in the Dallas-Fort Worth apartment market so far this year, the most of any major metro in the country.

To meet the tremendous demand for new housing across much of Texas, developers have been adding tens of thousands of new apartments throughout the state’s major metros at a feverish pace. There has been so much construction activity, that just in the last 12 months, developers have completed over 52,500 apartments in the Houston, Dallas-Fort Worth, Austin, and San Antonio markets, a new report from CBRE indicates. And by and large, these units are getting scooped up renters rather quickly.

The latest stats on the Texas multifamily market are substantial. To help illustrate how much new construction there has been in Texas, the report indicates that the top five markets for recent deliveries — which includes New York, Houston, Dallas, Washington, DC and Los Angeles — account for 27% of all the nation’s new apartments in the last 12 months. And while over 50,000 new apartments were built across the state’s largest metros in the last year, nearly 85,000 units were absorbed during this time.

Breaking it down by each market, the completion numbers are staggering. In the last 12 months, Houston has seen 15,600 new units added to its market, Dallas has had 13,600 new apartments delivered, Fort Worth saw 8,100 residences completed, Austin witnessed the completion of nearly 10,000 units and San Antonio had another 5,400 added to its total inventory.

But all of this new construction is coming at a cost. While the biggest cities in Texas have seen a steep increase in total supply of apartments in the last year, rental prices are also moving in a vertical direction.

According to the report, four of the highlighted cities have seen double-digit rent growth in the last 12 months. Austin rents have increased by an eye-watering 18% year-over-year according to CBRE, Dallas rent costs are up by 11.7%, San Antonio apartments are up 10.8% while Fort Worth rent prices have increased by 10%. El Paso rent growth is just under 10% while Houston’s stands at 8.5%.

The high absorption rates and quickly increasing rent prices have lured a lot of investment to Texas cities. The Dallas/Fort Worth Metroplex has actually led the nation year-to-date for the amount of dollars invested in new rentals: $16 billion. Developers have invested $7.38 billion in the Houston apartment market so far this year, while Austin has seen $5.16 billion invested in new development.

If you’re a recent transplant to Texas shell-shocked by the prices and competition for new rentals, you’re not alone. So long as Texas’s population growth and economy continue on an upward trajectory, there will likely be similar increases in new apartment deliveries, absorption and rent growth in the coming years.

ACE Mentor Houston A/E/C Industry After School Program

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ACE Mentor Houston is the local affiliate of the national ACE organization and is a collaborative effort to bring the multifaceted construction industry, educational institutions, and local community together to expose high school students to the world of architecture, construction, engineering, and building trades. In this afterschool mentoring program, student teams work directly with professionals from the A/E/C industry to design hypothetical projects, tour local construction sites, and visit architectural, engineering, and construction offices. The program runs from October to April and is operating with a hybrid program this year with virtual weekly mentor sessions and in-person activities to include site visits, building activities, and architectural walking tours.

For students, it is a unique chance to discover and develop new skills, solidify goals, and get on track towards exciting and rewarding careers. In addition, many students form positive relationships with industry professionals who can provide important references for obtaining college admissions, scholarships, internships, and full‐time employment.

For professionals, ACE provides an opportunity to give back to the community while developing the next generation in the building industry and networking with other professionals who share the same passions. If you would like to get involved in ACE as a mentor, student, industry partner, or committee member, please contact us (//www.acementorhouston.org/). If you have the passion, there is a role for you, no matter your time commitment, availability, or skill set.

Walker & Dunlop Completes Sale of Multifamily Community at the Texas Medical Center

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WALKER & DUNLOP COMPLETES SALE OF GARDEN-STYLE MULTIFAMILY COMMUNITY AT THE TEXAS MEDICAL CENTER

Walker & Dunlop, Inc. announced today that it completed the sale of The Co-Op at the Med Center, a 200-unit, garden-style property located in the heart of the Texas Medical Center in Houston, Texas. Originally built as a hotel, the asset was converted into a multifamily community in 2018 following a significant capital investment into the property.

Walker & Dunlop’s Scott Bray, Ryan Epstein, and Jennifer Ray represented the seller, Urban Genesis, in the transaction. The buyer, EAS Houston LLC, plans to capitalize on The Co-Op at the Med Center’s significant value-add potential with a number of upgrades, including interior unit renovations, upgrades to community amenities, and the addition of a technology package.

The Co-Op at the Med Center is one of the only garden-style multifamily properties in the immediate area, which is surrounded by newer construction, Class A communities. The property’s unparalleled location provides immediate access to the Texas Medical Center, one of Houston’s largest and most consistent employment bases, with over 106,000 employees and hosting 10 million patients. Residents of The Co-Op at the Med Center also enjoy convenient access to several grocery stores and are within minutes of Houston’sHermann Park.

Shipley Do-Nuts Plans ‘Experiential HQ’ at Former Finger Furniture Site

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Shipley Do-Nuts broke ground on a new headquarters near downtown that will bring new life to the former Finger Furniture warehouse near the Gulf Freeway at Cullen Boulevard.

Shipley officials gathered with community leaders Thursday to unveil plans for a flagship 60,000-square-foot building on the site, which also was home to minor league baseball teams at Busch (Buff) Stadium from 1928 until 1961. The Houston Buffaloes were a St. Louis Cardinals minor league team beginning in 1920.

“This is our field of dreams. Where we’re standing is the very first minor league ball team ever associated with Major League Baseball,” said Shipley CEO Clifton Rutledge, celebrating an expansion that marks the company’s 85th anniversary. “We’re very proud to be here.”

The headquarters, which will consolidate four locations along North Main and serve as a training center for franchisees, is part of a 16-acre development by Houston-based Lovett Commercial in the East End. It is the only structure on the former Finger Furniture campus to be salvaged. Click to read more at www.houstonchronicle.com.

From the Ground Up: Levey Group Rises to Challenge of Unprecedented Industrial Market

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Powered by an entrepreneurial spirit, Houston’s Levey Group is seizing the moment for which it has prepared for nearly 40 years.

When real estate visionary Gustave Levey, affectionately known as Gus, founded the company in 1982, he had no way of predicting the ebbs and flows of the industrial market building up to what it is today.

“He was one of the pioneers of the industrial real estate development business in Houston, having begun building to-suit, single-tenant manufacturing facilities for lease,” says David Ebro, Levey Group president and Gus’s grandson. “Manufacturing companies often had no leasing options because the institutional developers focused almost exclusively on warehouse and distribution space.”

The Levey Group has never been afraid to bet on a dark horse. As the company evolved, so too did its projects. Appreciating flexibility and avoiding formulaic thinking, its team often recognizes values others overlook.

“Over the years we have developed buildings for sale, and built-to-suit for
lease both, on a stand-alone basis, and within our business parks. We have also redeveloped functionally obsolete buildings, and made collateral-backed opportunistic loans,” says Ebro. “We have carried this entrepreneurial philosophy into our land development business by acquiring parcels that are often overlooked because of some functional challenge, be it a lack of utilities, floodplain issues, pipeline crossings, etc.” Click to read more at www.rednews.com.

Houston Medical Office Monthly Market Snapshot September 2021

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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.