27% Of Houston Commercial Real Estate May Be Flooded

Harvey Flood
Bisnow Archive/Kyle Hagerty

In an attempt to estimate the cost of Harvey's destruction, CoStar found that 27% of the gross leasable area in the Houston metro may be flooded, representing $55B in property value. In total, there are 12,000 properties totaling 400M SF that fall within the 500-year flood plain.

"Of the $55B at risk, $16B are apartment buildings in the 100-year flood plain," CoStar CEO Andy Florance said in a press release. "Unfortunately, the number of displaced residents could be far larger than current media reports indicate."

In CoStar's property-by-property review of the apartment buildings in the flood plain, the analytics company found an outsized share of the rental units are low- to moderate-income households, particularly in Southwest Houston where the bayous have overflowed. This highly dense section of Houston is home to more than 66,000 apartment units, of which nearly 30% are estimated to be impacted.

CoStar also found roughly 5M SF under construction is within the flood plain, representing one-fifth of Houston's total commercial real estate pipeline. The most heavily impacted apartment construction was within the 100-year flood plain concentrated near the Medical Center.

With much of the area still reeling from the storm, it is still too early to tell just how accurate CoStar's estimates are. Officials expect the recovery to take months or even years. CoStar is planning an air survey to further assess the damage as soon as possible.

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