The U.S. economy is in one of the longest expansion periods in history. The length of the expansion is causing some investors to be cautious in their nervousness on when the expansion will end, even though most think the expansion will continue for a while yet, but at a slower growth rate.
Greater Houston Growth
Greater Houston has the largest job growth of any U.S. Metro in the past year, coming in just behind the U.S. 3.7% unemployment rate with a 3.8% unemployment rate. Important sectors such as the office sector are just recovering from the last oil downturn driving that growth.
Blue collar jobs saw the most growth, leading the way in construction and manufacturing jobs. While the metrics look strong for continued growth, we do have some reasons to be concerned in Houston. Oil prices are uncertain, an impact we are all too familiar with. But, the trade war with China is causing more uncertainty as China is the 2nd largest trading partner for the Port of Houston, after Mexico.
Commercial land sales slowed in 2018. The HCAD report attributes this to investors focusing on developing previously acquired property as well as quality vacant land becoming more scarce. And the northwest area of Houston continues to lead in sales activity.
The Downtown Living Initiative Program continues to spark development too. Two new high-rise apartments, and a high-rise apartment rehab. Several mid-rise apartments were built as well.
Where is commercial real estate growing and how?
- Galleria and Uptown: Mixed Use Development
- Inner Loop: Transformation continues with ExxonMobil Research facility development, Shell Oil information center sold, Radom Capital & Triten Real Estate mixed use office and retail space, Caydon Property Group’s high rise, AECOM & PMRG’s high rise on Main in midtown, and Rice Management’s transformation of the midtown Sears building.
- Northwest Quadrant: Continued growth is led by Springwoods Village and Aldine as the Grand Parkway continues to be the catalyst for growth.
- Northeast Quadrant: Generation Park
- Southeast Quadrant: Redevelopment of Baytown’s San Jacinto Mall
- Southwest Quadrant: Marathon to move to CityCentre
Additional Houston Commercial Real Estate News
The office market is on the brink of recovery finally.
Apartments are back in an expansion phase.
Retail expansion seems to have peaked.
Warehouse expansion continues with no end in sight.
We encourage you to read the full 2019 Market Trends report for all the important details.