The Deal Sheet
Is the industrial market, which has been so tight for so long, finally loosening? (Like the grip of a snake or an old girdle.)
Stream’s Jeremy Lumbreras (right, with colleague Matteson Hamilton, and they should both have a side business teaching folks how to tie a pristine necktie) says 5.5M SF of industrial product has delivered in the last 18 months at 65% pre-leased. 7M SF is under construction now city-wide. North and Northwest Houston are getting the bulk of activity, but he points out that most North Houston developments are second phases of institutional projects. Stream is gearing up Interstate Commerce Center up that way, a two-building, 413k SF development west of 45 and south of 1960. It’s being built in partnership with Hillwood and Copeland Commercial.
Transwestern VP Jude Filippone (left with Jacob Carr) is definitely watching for a short-term negative impact in North and Northwest Houston from all the development. City-wide industrial vacancy leapt from 4.3% last year to 5.4% in Q1. But we also posted 1.7M SF of positive net absorption, and Jude is finding that rents are doing well, concessions are down, and users are taking longer leases. He’s also seeing a trend to larger deals, with more 100k SF tenants in the market. Jude’s most recent deal, a 76k SF renewal for Rofson Associates, showed the opposite trend—it downsized.
EXECS
Colvill Office Properties’ Marilyn Guion was promoted to VP. She was formerly director of leasing, and handles a 4.3M SF Houston portfolio including Galleria Office Towers, BLVD Place, and 600 Travis.
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Cushman & Wakefield’s Houston pros took away top honors recently—Tim Relyea was named the firm’s 2013 top producing broker in the Americas (besting over 2,200 colleagues), and Dave Cook was the top industrial producer in the Americas. This is Tim’s third time earning the top broker distinction. Our local industrial team had a great showing: Besides Dave, three other Houston brokers (Jeff Peden, Kelley Parker, and John Littman) were in the top five industrial brokerage spots for the company.
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Jay O’Connor joined Domain Communities as EVP of acquisitions. He will spearhead multifamily and senior housing investments. Jay has been involved in over $3B in transactions over his 23 years in real estate.
SALES
Fulshear Real Estate Partners purchased 20 acres on FM 1093 in Fulshear. ICO Commercial’s Jane Holloway Nodskov and Lang Motes repped the seller and Re/Max Realty West’s Mike Roller repped the buyer.
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13727-13731 FM 529 LLC purchased two industrial building in Atco Industrial Park (on FM529 between North Eldridge Parkway and Jackrabbit Road). The two new metal spec buildings total 18k SF. NAI Houston’s John Ferruzzo repped the buyer and Centermark CRE’s Eric Hughes repped seller ATCO-Valley Plaza.
LEASES
Advanced Piping Products doubled to 21k SF at 5611 Guhn Rd. Cresa’s Chase Spence repped the tenant and Stream’s Michael Flowers repped the landlord.
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Records Resource leased 18k SF in Sam Houston Center. Southwest Realty Advisors’ Marc Drumwright repped the tenant and Transwestern’s Darryl Noon repped landlord St. Paul F&M Insurance.
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Smith and Associates subleased 57k SF at ClayPoint Distribution (8820 Clay Rd). NAI’s Dan Boyles and Nick Peterson repped the sublessee and Stream’s Jon Farris repped the sublessor.
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UTI leased 70k SF of office/warehouse space at 16680 Air Center Blvd. Cypressbrook’s John Hornbuckle repped landlord Cobalt Industrial REIT II and Lee & Associates’ Reid Bassinger repped the tenant.
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KBS Strategic Opportunity REIT inked 49k SF of lease renewals at West Loop I & II, a 314k SF office complex in Bellaire.
• Synergy Healthcare inked 30k SF. PMRG’s John Spafford and Allie Hubbard repped the landlord and CBRE’s Brandon Clarke and Collin Grimes repped the tenant.
• BBC USA Chartering signed for 17k SF. Transwestern’s David Baker and Kelli Crutchfield repped the landlord and Jackson Cooksey’s Joshua Brown repped the tenant.
• Contemporary Medicine renewed two leases totaling 2,500 SF.
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DCL America leased a 25k SF office/warehouse in Commerce Oaks Industrial Park in Oak Ridge North. Southwest Realty Advisors’ Marc Drumwright and Patrick McKiernan repped landlord Nickson Commerce Oaks Industrial and Best Priced Properties’ Russell Banki repped the tenant.
DEVELOPMENT
Triad Construction wrapped up three projects for Silverleaf Resorts in the last month, Buildings 4 and 35 (pictured) in Galveston, and 41 in Canyon Lake. Building #35 is the first high-end “ambassador” building in Galveston for Silverleaf. Triad also recently finished the Pearland Convention and Visitor Center.
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Harris County’s Burnett Bayland Gym recently broke ground and is the first LEED Platinum-seeking public building in Houston. The 14k SF facility is part of a juvenile rehabilitation center and includes a gymnasium, locker room, reception area for visitors, kitchen, classrooms, and a library. Sustainable features include a high degree of contact with natural daylight, which helps regulate circadian rhythms and balance hormonal levels of serotonin (especially important to youths because they affect mood, sleep, learning, and social behavior). Design by Kirksey also focused heavily on water sustainability, achieving every water point available in the LEED system.
FINANCING
Centerline Capital provided a $9.9M Freddie Mac loan to facilitate the acquisition of Windmill Landing. The property is a 259-unit garden apartment complex. The loan was structured with a seven-year term, interest accruing on a variable basis, and amortizing over 30 years. The borrower will address deferred maintenance and capital improvements. Centerline’s James Kelley and John Beam handled the deal. US Residential Group has taken over management of the property.
THIS AND THAT
Moody Rambin was retained by Katy Freeway Investors as exclusive leasing agent for 11451 Katy Fwy, a six-story, 121k SF building. The property has a block of two full floors available with building identity, a unique opportunity these days in the Energy Corridor. Kurt Kistler and Bob Cromwell will handle the assignment.
