November 15, 2006
Downtown housing demand

Nice to know that downtown Houston continues to be a success story as far as housing goes.

Apartment occupancy in downtown is 89 percent, according to data gathered in the spring by Central Houston, a group that promotes downtown revitalization. That's up from 83 percent the year before.

By contrast, the overall trend for apartments citywide is down slightly by 1.7 percent over the past 12 months, because of new supply and Katrina evacuees moving out of apartments, according to Apartment Data Services, a research firm.

"We have so many more employees in downtown than we did a year ago," said Laura Van Ness, director of business development for Central Houston, after listing more than a dozen big companies moving to the central business district or leasing more space there.

With the top-class office vacancy rate now at less than 10 percent, developers are moving forward with residential projects to capture some of the anticipated demand.

The Finger Cos. is building a 37-story tower near Discovery Green, a new downtown park being developed near the convention center. The building, to be named One Park Place, will have 346 apartments.


Another developer is proposing to buy and renovate the long vacant Texaco Building with more than 400 residential units.

Michael Hassler, a real estate broker with CB Richard Ellis, who's marketing the property, won't name the developer because of a confidentiality agreement but says it's a well-known group that's "very committed."

Not everyone has been so determined.

A prime block on Main Street and Texas Avenue sat vacant for years while a developer pondered plans for a condo project called the Shamrock Tower. The plans were ultimately scrapped and the block is still abandoned.

The developers of Houston Pavilions, a three-block, mixed-use project proposed along Main Street, said they're not going forward with two residential towers that once were part of the plan, focusing instead on the retail and office components.

But it wasn't for lack of demand. Pavilions developer Geoffrey Jones said parts of the project became too costly after last year's hurricanes caused prices for construction materials to spike.

"What we've generally found was demand for all real estate product types in downtown is as strong as we've seen it in years," he said.

That's great. As the article notes, the Enron collapse really did a number on downtown, but it's bounced back bigtime. Now if only we could get some of that construction and demand to spread out to Midtown, we'd really have something. Gotta be patient, I suppose.

Posted by Charles Kuffner on November 15, 2006 to Elsewhere in Houston | TrackBack

Now if only we could get some of that construction and demand to spread out to Midtown

Housing construction HAS spread to midtown. The problem is, the walkable utopia retail construction envisioned/promised by midtown boosters hasn't developed. Instead, there are empty storefronts and plans for a CVS that seem to annoy the utopians. And there are a LOT more for sale/reduced signs outside of the townhouse developments that are in these transition neighborhoods than even a year ago, suggesting it's overbuilt if anything.

I wonder if the WSJ reporter even made it town for his midtown story. It seemed to follow closely Mike Snyder's earlier reporting for the Chronicle, as I pointed out when I first posted the link to the WSJ.

Posted by: Kevin Whited on November 15, 2006 6:25 AM