Texas Office Market Hits Five-Year Low In Sales
Texas office sales hit a five-year low in Q1. Office investment sales dropped 63% year over year, according to a report by CommercialCafé.
The biggest deal out of the 19 buildings sold from January to March was the sale of the Houston Marathon Oil Tower to M-M Properties and Baupost Group for $175M. This is the third time since 2015 the property was put up for sale.
DFW was the most active of the major Texas markets with 11 sales in Q1 totaling $87M. (Sales prices for seven of the 11 were not disclosed.)
Excluding the omitted sale prices, DFW’s average sale price was $108.02/SF, whereas Houston’s was $144.17/SF. Austin had no reliable per-SF because the number of sales was too low. Overall, Texas fell just shy of a $200/SF average sale price.
DFW’s biggest recorded sale was Libitzky Property Cos. and Sunwest Real Estate Group’s purchase of MetLife Real Estate Investments’ 406K SF office building at 1925 West John W. Carpenter Freeway. The building sold for $45.2M, CommercialCafé reports.
In terms of office completions, Texas will have registered 11.5M SF of new inventory by the end Q2 — 4.8M SF have already been delivered as of March. Of the 17 projects finalized in Q1, the largest was the 1.4M SF JP Morgan headquarters at Legacy West in Dallas.