Hines' Beltway Southwest BP is Only the Second Step. Here's Why.
Hines purchased 75 acres to build a nearly 1M SF master-planned business park in southwest Houston. It's all part of the firm's plan to cover every part of Houston and meet every industrial tenant requirement.
Beltway Southwest Business Park (marketed by Cushman & Wakefield’s Jim Foreman and team—pictured, Jim at Hines' industrial broker event yesterday at iFly) will sit at the northeast corner of Beltway 8 and Fort Bend Toll Road, giving users access to the southwest and west parts of town. Hines director Charlie Meyer tells us Hines wants to be able to serve tenants that have expansion needs in every part of town. Between Beltway Southwest and Pinto Business Park, Hines can reach pretty much the entire western hemisphere of Houston. Next, Hines will build a business park in east Houston. Charlie is already seeing strong interplay between Beltway Southwest and Pinto—many of the firm’s tenants in north Houston have additional locations or have expressed a desire to expand in the southwest part of town. (For example, HD Supply and Red Bull, two Pinto tenants, both have southwest locations.)
Phase 1 of Beltway Southwest includes 350k SF: a 240k SF cross-dock featuring 32-foot clear height and a 110k SF rear-load building. It’ll break ground in July (site clearing begins in two weeks) and deliver around March 2016. The park, designed by Architects Plus, could eventually house 950k SF of light manufacturing and distribution space. Charlie says the timing is great to develop new industrial product—Houston's industrial market (especially local food distribution, which the Southwest submarket is known for) is mostly driven by population and GDP growth and has not been impacted by oil prices. That's driving unheard of absorption, 4M SF in Q1 alone.
Southwest is also land constrained, which means there are relatively high barriers to entry. That also made this deal very difficult to pull together—what looked like a simple two-tract acquisition to assemble the site turned into a very lengthy, challenging process involving five sellers and six months of site negotiations. Charlie gives all the credit to Cushman & Wakefield’s Jim Foreman, Beau Kaleel (above, taking his turn at iFly yesterday) and Allison Hall, who literally knocked on homeowners' doors to get the frontage tracts Hines needed to meet TxDOT's access points. (Jim also had to coordinate the removal of a corral with several miniature ponies that was hidden in the woods on the site.)
Pinto Business Park is also about to expand, Charlie tells us. His team has leases working that'll bring existing product nearly full. Thus, it's in design with the next phase of development—Hines aims to deliver a 500k SF cross-dock property (Fallbrook I, rendered here) and 200k SF rear-load building in Q1 '16.