Real Estate Rumblings

Houston's the Super Bowl of apartment markets: Developers build for sky-high rents

ZOM Texas, a Dallas-based apartment developer, is diving into Houston’s Tanglewood area with a 431-unit apartment project.

The apartment project, called The Hudson, will be built on a 5.3 acre site located on Fountainview at San Felipe, near a planned H-E-B-anchored shopping center.

“ZOM continues to pursue multifamily development opportunities in Texas, with a particular focus on the Houston market, based on compelling long term trends,” says David Kubin, senior vice president for ZOM Texas. “With Houston currently ranking No. 2 in the U.S. job market, and the anticipated robust job growth over the next five years, we niche into this market with a carefully researched, unique product and mix.”

“It’s like winning the Super Bowl two years in a row."

The Hudson will be a four- and five-story apartment complex wrapped around a seven-level parking garage.

A number of apartment developers from other parts of the nation have been constructing new apartments and scouting around Houston, searching for places to build more, says Stacy Hunt of the Greystar firm.

“Houston is the best place in the country to be right now,’ Hunt said at the annual Houston Apartment Association State of the Industry Breakfast.

Rents for Houston apartments have gone up significantly, says Bruce McClenny, president of Apartment Data Services. For the best “Class A” apartments rents went up an average of eight percent in 2012 and six percent in 2013, he says, a phenomenal gain.

“It’s like winning the Super Bowl two years in a row,” McClenny says, noting that about 15,000 new units were built in Houston in 2013.

People are willing to pay more rent in order to live in a desired location. “People are making the choice not to commute,” said apartment expert Ryan Epstein of CBRE Group. “They are willing to pay an extra $300 to $400 to avoid the commute.”

In the close-in areas, some high-rise apartment towers are being constructed. Others, like ZOM Texas are building mid-rise “wrap” style construction, meaning the apartment living buildings surround a central parking garage.

ZOM has previously developed seven projects in Texas. The Hudson is ZOM’s third project in Houston.

Stanford Construction will serve as general contractor of The Hudson. Initial leasing will begin in 2015.

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Record-breaking property

Ultra-luxurious Houston high-rise lists last penthouse for $14.5 million

A rendering of the exterior of the St Regis Residence in Houston

Rendering courtesy of Shimahara Visual

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A new Houston high-rise is issuing a final call for one of its most desirable units. The St. Regis Residences, Houston has one remaining penthouse available for $14.5 million.

A representative touts that the $3,100 per square foot price is a new record for Houston-area high-rises. It’s one of seven penthouses at the property that range in size from 4,500 to 6,500 square feet.

“The last available penthouse at The St. Regis Residences underscores the strength and maturity of Houston’s luxury market,” said Catherine Lee, president of Douglas Elliman Development Marketing, Texas, which is handling sales and marketing for the building. "Discerning buyers are consistently choosing standalone branded residences that deliver enduring quality, trusted service, and global brand recognition — all of which is evidenced by the premium price-per-square-foot. Opportunities of this caliber, particularly at this level of scarcity, are increasingly rare.”

A rendering of a penthouse at the St Regis Residence in Houston A rendering illustrates one of the building's penthouses.Rendering courtesy of Shimahara Visual

As CultureMap has previously reported, Houston-based commercial real estate firm Satya is building the 37-story, curvilinear tower. Set on a nearly four-acre property near Houston’s iconic Bayou Bend Collection (102 Asbury Street), the tower will offer 90 residences.

Buyers can select from various floor plans, including one-bedroom units. Pricing for these luxurious homes begins at $3 million, with residences starting on the 10th floor.

Residents will enjoy more than 40,000 square feet of amenities, including butler service, a lap pool, steam rooms, saunas, fitness studio, dedicated training space, a yoga and movement studio, and St. Regis-branded bicycles. A dedicated children’s activity center, gaming lounge, theater, and event space will offer entertainment for all ages, while the Cognac Bar and Astor Room on the 26th floor will provide a refined dining experience in homage to the St. Regis founding family.

Additional perks include co-working spaces, two guest suites, and full-building backup generators — an invaluable feature in Houston.

The project is expected to break ground this spring, with an expected completion of early 2029. So far, the building has more than $180 million in gross sales, according to press materials.

“The demand for this level of condominium in Houston continues to show the market is prime for a new paradigm of residential experience and the impeccable service of legendary hospitality that The St. Regis brand is known for,” said Sunny Bathija, owner and developer of The St. Regis Residences, Houston and CEO of Satya.

St. Regis Residences, Houston, is neither owned nor developed by Marriott International or Marriott, but rather SR Luxury Condominium, LTD. It has licensed the St. Regis marks from Marriott for the project.

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Brianna McClane contributed to this article.

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