Houston is experiencing a boom in the real estate market, with the cluster of companies in the Energy Corridor as the focus of rapid growth and new jobs. Along with the energy sector, the city’s largely centralized medical center and the Port of Houston are driving forces for the region’s bustling economy. Experts say that now is a prime time for commercial real estate financing.
Houston’s west side — the oil and gas sector — plus the medical center south of the city’s central business district and the Woodlands, 27 miles outside of downtown , are the most attractive areas for new office space construction, which is in high demand. Since employment in the city has gone up 3.7 percent since August 2008, Houston developers are building 15 new office buildings this year alone.
Rather than commute, many employees in Houston move close to where they work. Houston is the U.S.’s only major city without zoning laws, making it possible for a diverse and capitalistic real estate market that caters to its local industry. Amid the high-rise office skyline of the Galleria, multi-family construction is being built to serve the growing job market. As more apartments and single-family housing are constructed near major employers, additional retailers to serve the population are attracted to the area, creating self-serving community islands.
Property owners are also enjoying the benefits of the city’s growth: Occupancy in one investor’s five office buildings in the Woodlands is nearly at 100 percent, compared to around 60 percent in 2010. With the increase in job growth and the demand for more office space, many investors and property owners are confident that Houston will continue to be one of the country’s best commercial real estate markets.
Source: The New York Times, “A Boom in Houston Is Led by the Energy Industry,” Matt Hudgins, Dec. 4, 2012