Real Estate Round-up
As Houston left the 20th century, new urban frontiers opened. These new projects introduced new ideas for developers.
Regions and neighborhoods that had been regarded as duds gained new life in the 2000s. The new decade lifted limited expectations as developers discovered new truths about the local real estate market, such as the fact that some Houstonians do indeed want to live downtown.
During the last 10 years, Houston’s real estate trends and the key projects that embody them are:
1. Randall’s Food Market, Midtown. This grocery made Midtown a more complete neighborhood. Randall’s, a 37,000-square-foot store located at the corner of Louisiana and Hadley, also serves residents in adjacent downtown Houston. Urban dwellers have had restaurants and nightclubs galore. But until Randall’s opened in 2002, the all important supermarket element (read: food) was missing. The remaining deficiency for downtown living? Kids. Until families with children move into downtown, it cannot be a well-rounded community.
2. Sharpstown Center, Southwest Freeway at Bellaire Blvd. Before he became a senator, Ted Kennedy was the headliner speaker for the grand opening of Sharpstown mall in 1961. Sharpstown was the first enclosed air-conditioned mall in Houston. Things have changed. Sharpstown no longer has Macy’s or JC Penney. As 2009 came to a close, the mall was renamed PlazAmericas; it will house an 83,000-square-foot mercado with mariachi bands. Across Houston, places like Sharpstown mall and the surrounding 1960s-vintage neighborhoods are now in transition. The era of Sharpstown and Ted Kennedy is over.
3. Palisade Palms. East Beach Drive, Galveston. The 27-story Palisade Palms condominium towers were built during the height of the residential boom of the 2000s. Galveston’s real estate market took off and prices soared as low mortgage rates and the investment potential of second homes seduced buyers. Thousands of new vacation condos and beach houses were built on the island. Interestingly, Palisade Palms attracted development to the east end of Galveston, counter to the trend for west end construction. In 2008, Galveston was hit by a vicious double-whammy of Hurricane Ike and the national recession. But for awhile, at least, Galveston had demonstrated that it could be a major vacation-home market.
4. Hilton Americas, 1600 Lamar, downtown Houston. This 1,200-room hotel, which opened in December 2003, brought momentum to the eastern part of downtown. The George R. Brown Convention Center had been isolated from other development since it opened in east downtown in 1987. The Hilton, connected to the convention center with skywalks, gave that part of town more mass and density. Other new activity on the eastern side of downtown has included the Toyota Center arena, Discovery Green park, and the Minute Maid baseball stadium. As the largest hotel in town, Hilton Americas gives Houston the ability to draw major conventions. When the national economy rebounds, Houston could see some large, tangible benefits from having a vibrant convention industry.
5. Bridgeland. Near U.S. Highway 290 and Fry Road, northwest Houston. This 11,400-acre, master-planned community elevated the Highway 290 corridor to a major growth sector for decades to come. Real estate veteran Steve Montgomery of the Transwestern company says transportation improvements along 290 point the way for a significant amount of new construction and opportunity from Loop 610 almost all the way to Brenham. A huge amount of retail space has been built near Bridgeland already. As a large-scale development, Bridgeland may be the last of its kind, however. Overwhelming start-up costs and a decades-long wait for a payday make 10,000-acre-plus projects unattractive in today’s economics.
6. Metro Rail. A 7.5-mile rail line running from downtown to the Reliant Stadium area. Since it opened in 2004, Metro Rail has been successful by some standards. It averages some 40,000 riders daily. New townhomes and apartments have sprung up along the route. But some question whether the rail has been the strong development catalyst that it was supposed to be. This starter line has paved the way for further expansion of the light rail, which will bring connect the Galleria area, the University of Houston and other hot spots. The expansion of the rail will change the way we live and create development opportunities near Metro stops.
7. Anadarko Tower, The Woodlands. This 30-story office building is a can’t-miss visual when you head north of Houston. The Anadarko energy company left Greenspoint for The Woodlands about eight years ago. Americans love the convenient, gasoline-saving aspects of living near their workplace, so naturally more office buildings are being constructed in suburbs. With the Anadarko Tower, The Woodlands was confirmed as prime location for major corporations and it is essentially a full-fledged city today.
8. Andrau Airpark, Westheimer Road. This 700-acre airfield became part of the West Belt/Sam Houston Parkway development boom. The airport, purchased for $53.5 million by Camden Property Trust, became the upscale 900-home Royal Oaks community and golf course. Significant retail space and apartments were built on Andrau’s Westheimer frontage. Another tract of Andrau’s magnitude won’t be coming down the pike any time soon. “That was the largest land sale in the Houston city limits in 50 years,” says land broker Stan Creech.
9. Sugar Land Town Square, U.S. Highway 59 at Highway 6 in First Colony. Enclosed air-conditioned malls are out. Town centers are in. The Sugar Land Town Square was one of the first of the new wave of mixed-use projects that brought retail, residential, offices and hotels together in a walkable mix. A new City Hall for Sugar Land was incorporated into the project. This project was the forerunner for other mixed-use developments, including West Ave. and Pearland Town Center. The regional mall genre is dying.
10. Wal-Mart Stores Inc., FM 1405 and Spur 55 in Baytown. Yes, this is a big warehouse. It’s four million square feet of space—some 92 acres under roof. But what it could do for the Houston economy is even bigger. With Wal-Mart as an industry leader, Houston’s port could become a primary destination and distribution point for goods from Asia. A significant expansion of the Panama Canal is in the works, and all of this could make Houston a more dominant international port for decades to come.
Ralph Bivins, former president of the National Association of Real Estate Editors, is editor-in-chief of RealtyNewsReport.com.