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Apartments Single-Family Housing Permit Issuance Office Buildings Retail Centers Industrial Facilities Vacant Land Economic & Financial News Potpourri Click here for a PDF (printable) version of this report.

Apartments

According to www.oconnordata.com, May 2010 O’Connor & Associates data indicates that Greater Houston apartment market occupancy has increased 0.15 percentage points from the previous month and is currently 86.23% occupied, while overall rents stand at $0.883 per square foot. Class A and B rates registered an increase of $0.001 each, ending at $1.163 and $0.833, respectively, while Class D decreased by $0.001 to $0.629. Class C rates witnessed the largest increase of $0.002 to $0.725. The current construction pipeline includes 32 communities (7,668 units) city-wide, fifteen of which (4,608 units) are already pre-leasing. As these new communities are completed and delivered to market, overall occupancy should continue to decline.

Apartment Developments

• Sueba USA Inc (713-747-7333) has completed construction on North Post Oak Lofts (18472), a 330-unit apartment community located at 1255 N Post Oak Rd in the Galleria submarket (451Z). The community features one- and two-bedroom units with an average size of 1,114 square feet and average rental rates of $1.34 per square foot. The property is currently 43% occupied. Common area amenities include a resort-style pool and spa with poolside stainless steel gas grills and athletic center, executive business center and conference room, remote controlled access gates with attendant , and valet trash service. Unit amenities include brushed nickel fixtures and hardware, open gourmet kitchens with black appliances, oversized garden tubs and separate showers, and a full size washer and dryer in every unit.
  
  
• Avenue Community Development Corp(713-864-8099) has started construction on Avenue Terrace (18593), a five-story, 144-unit Tax Credit apartment community located at 4004 Irvington Boulevard in the Heights submarket (453Z). The community, being developed on former FedEx freight site, will feature one-, two- and three-bedroom units with an average size of 962 square feet and average rental rates of $0.80 per square foot. It is part of the Avenue Place project which will also include 95 single-family homes, a park, and a walking trail. Austin-based Northfield Design Associates Inc (512-302-1458) is the architect, while Camden Builders Inc(713-354-2500) is the general contractor
  
  
• Kilday Realty Corp (713-914-9400) has completed construction on Glenwood Trails (17722), a 114-unit Tax Credit apartment community located at 4305 Glenwood Dr in the Deerpark submarket (538X). The community features one-, two-, and three-bedroom units with an average size of 958 square feet and average rental rates of $0.75 per square foot. The property is currently 37% occupied. Common area amenities will include a fitness center, business center, pool and clubhouse. Unit amenities include large closets, washer/dryer connections, and refrigerators with ice makers.
  
  
• LDG Development (502-638-0534) has started construction on The Melbourne Senior Apartments (17723), a 110-unit Senior Tax Credit apartment community located at 3705 Mustang Road in Alvin in the Brazosport submarket (732A). The gated community, valued at around $16 million, will feature one- and two-bedroom units with an average size of 999 square feet and average rental rates of $0.65 per square foot. Common area amenities will include a furnished fitness center, outdoor pool, business center, library, and garage. The project is slated for completion around May 2011.
  
  
• M Group (713-522-4141) has started construction on Jackson Village Retirement Center (18288), a 96-unit Senior Tax Credit apartment community located at 300 Abner Jackson Blvd in the Brazosport submarket (883L). The community will feature one-, and two-bedroom units with an average size of 738 square feet and average rental rates of $0.89 per square foot.
  
  

The following chart illustrates historical apartment occupancy.

Apartment Sales

• Wells Fargo Bank, (866-518-2164) has purchased Oakwood (4179), a153-unit apartment complex located at 905 Highway 332 in the Brazosport submarket (884N), from Veard Lake Jackson LP (440-245-2813). The 35-year-old, Class C complex is currently 90% occupied with average rents of $0.69 per square foot.
  
  
• PMCF Properties LLC, an entity of Prudential Mortgage Capital Company (973-802-6000), has purchased Rancho Verde (1726), a 336-unit apartment complex located at 6000 Sunforest Dr in the Brookhollow submarket (451B), from GFI Capital Resources Group (212-668-1444). The 35-year-old, Class C complex is currently 59% occupied with average rents of $0.65 per square foot.
  
  
• PMCF Properties LLC, an entity of Prudential Mortgage Capital Company (973-802-6000) has purchased Luxor Park (1782), a 492-unit apartment complex located at 5801 Sunforest Dr in the Brookhollow submarket (451B), from GFI Capital Resources Group (212-668-1444). The 33-year-old, Class C complex is currently 67% occupied with average rents of $0.67 per square foot.
  
  

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Single-Family Housing

MLS increased further in April as 4,526 existing homes were sold, compared to 4,057 homes sold last month, according to the Houston Association of Realtors (HAR).  Sales for April 2010 were also up 30% from April 2009.  The median price of an existing single-family home sold in April was $145,000, up 4.3% from the same time last year, while the average home price – $192,930 – was up 8.9% from the April 2009 level.
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Note: MLS sales include primarily existing home sales throughout the Houston region. Historical comparisons are offered solely for informational purposes and may not truly reflect growth in sales.

According to American MetroStudy, net sales of new homes increased by 5.53% in April 2010 to 1,642 and are up over 14.27% from April 2009. Realtor co-op sales represented nearly 65.7% of gross sales for the month, up 0.83% from April 2009 level. Traffic declined 7.35% from last year to 14,492 in April 2010. The inventory of completed speculative homes (1,052) is down 23.38% from April last year. There are 1,755 spec homes under construction, which is up 32.7% from April 2009. Overall, the 2,807 specs (both completed and under construction) are up over 4% from April 2009.
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Note: the 23 homebuilders in this survey account for approximately 55% of housing starts in Houston.

Nationwide sales of new single-family homes increased in April to a seasonally adjusted annual rate of 504,000 – 14.8% above the revised March sales rate of 439,000 and 47.8% above the April 2009 figure – according to a release by the US Department of Commerce.  The median sales price in April was $198,400. Privately owned housing starts were at a seasonally adjusted annual rate of 672,000 in April 2010, which is 5.8% above the revised March estimate and 40.9% above the revised April 2009 rate. Privately owned housing completions were at a seasonally adjusted annual rate of 769,000 in April, 19.2% above the revised March figure but 8.7% below the revised April 2009 figure.

The National Association of Home Builders/Wells Fargo Housing Market Index, a monthly measure of builder confidence, increased to 22 in May 2010, on a scale where any number greater than 50 indicates that builders view sales as more good than poor. The index measuring current sales of new single-family homes increased to 23, the index measuring sales expectations for the coming six months increased to 28, and the index measuring the traffic of prospective buyers is currently at 16, three points up from the revised April 2010 figure.

According to the National Association of Realtors (NAR), 5,770,000 existing homes were sold in April 2010, up 7% from March sales and up 22.8% from the 4,700,000 homes sold in April 2009. The median sale price was $173,100, which represents 4.0% increase from sale prices last year.

According to the most recent report by RealtyTrac, 333,387 foreclosure filings – default notices, auction sale notices, and bank repossessions – were reported during the month of April 2010. This figure is down 9% from the previous month and down 2% from April 2009. Texas is among the nation’s 28 highest states in total foreclosure filings in April 2010.

The following chart illustrates historical existing home sales.

Source: Houston Association of Realtors

• No single family developments were recorded for the month of May.

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Permit Issuance

The City of Houston issued permits to build 243 private single-family houses and 40 private multifamily buildings in April. Demolition permits were issued for 79 private single-family houses and three multifamily structures. In addition, 196 permits were issued for privately owned non-residential construction totaling $69,136,071 and 10 permits were issued for public non-residential construction. Additions, alterations, and conversions totaled $106,510,260 for the private sector and $31,771,885 for the public sector.

Cost of Construction*
	2008	2009	2010
Month of April	$723,145,639	$212,139,341	$293,898,815
Year-to-Date	$2,252,430,269	$1,328,513,316	$999,897,222

*The figures in this section include all categories of buildings and non-building structures

*The figures in this section include all categories of buildings and non-building structures

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Office Buildings

According to the O’Connor & Associates First Quarter 2010 Houston Office Data Program, citywide occupancy for Houston area multi-tenant office buildings is 83.13% (Class A = 85.05%; Class B = 81.32%; Class C = 81.12%; Class D = 78.47%).  The citywide quarterly multi-tenant office rental rate is $20.84 per square foot (Class A = $23.72; Class B = $18.81; Class C = $14.99; Class D = $13.2).
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Note: The office buildings listed herein are followed by their representative sector code and identification number as they appear in the O’Connor & Associates OfficeLink Online Data platform and are provided for subscriber cross-referencing. The property information contained within this database is updated on a monthly basis and accessible over the web. (Please contact us for more details.)

Office Developments

• Hines (713-621-8000) has completed structural construction of Main Place (2296), a 972,000-square-foot, Class A office tower located at 811 Main Street in the Central Business District sector (493Q). The 46-story office tower, pre-certified at the LEED™ Silver level by the U.S. Green Building Council, features a sky garden on the 39th floor, planted terraces, and a five-story crystalline atrium. The top four floors are already pre-leased to KPMG LLP (713-319-2000). Pickard Chilton (203-786-8600) designed the tower and D.E. Harvey Builders (713-783-8710) is the general contractor. The grand opening is slated for January 2011.
  
  
• Jacobs Engineering Group Inc (713-869-7900) has been assigned a $70 million renovation project for Mickey Leland Federal Bldg (110), 496,285-square-foot, Class B office building located at 1919 Smith Street in the Central Business District sector (493P), by General Services Administration(817-978-2321). Jacobs, as part of its construction-management and commissioning services for the project, will provide the 22-story, 28-year-old building with building system modernization, repairs and major upgrades including HVAC repairs, accessibility modifications, a new window system, and changes to the lobby plaza and garage. Upon completion of the project, the building will be slated for LEED™ Silver certification.
  
  

The following chart illustrates historical office occupancy.

Office Sales

• Wachovia Bank (713-863-0451) has purchased 2000 St James Place (444), a 335,000-square-foot, Class A office building located at 2000 St James Place in the Galleria sector (491P), from an owner partnership led by Dougal Cameron of Cameron Management Inc (713-333-1001) as part of a foreclosure that was finalized in May. The 32-year-old, 13-story building reverted to the bank after being put up for auction and finding no bidders.  Russell Ingrum and Todd Casper of CB Richard Ellis Inc represented the seller.
  


• 6300 West Loop Realty Ltd, a partnership led by Braun Enterprises (713-541-0066), has purchased 6300 W Loop S (10), a 101,000-square-foot, Class B office building located at 6300 West Loop South in the Bellaire sector (531G), from Midland Loan Services Inc (913-253-9000). Midland was the special servicer assigned for the disposition of this foreclosed property. The 39-year-old, six-story building was over 75% leased at the time of sale.   Dan Braun represented the buyer in-house, while Russell Ingrum and Todd Casper of CB Richard Ellis Inc. represented the seller.
  
  
• Adrian Hernandez & Associates (713-961-0262) has purchased 9543 Bissonnet (1802), a 16,000-square-foot, Class C office building located at 9543 Bissonnet Street in the Southwest Freeway sector (530S), from Whitney National Bank (713-951-7700). The 37-year-old, three-story building is now fully occupied.   John S Wall and Will Moss of The Situs Companies represented the seller
  
  

Office Leases

• UTMB Pediatrics (281-538-7735) has leased 19,764 square feet at Bay Colony Professional Building (2307), a 43,000-square-foot, Class A building located at 2895 Gulf Frwy in the Clearlake sector (619Y), from NewQuest Properties (281-477-4300). The two-year-old building is 90% occupied. Kelly Hutchinson of Commercial Real Estate Services represented the tenant, while Heather Nguyen and Rebecca Le represented the landlord in-house.
  
  
• BHC Marketing Ltd (281-362-9183) has leased 12,000 square feet at The Reserve at Sierra Pines (2457), a 175,000-square-foot Class A office building located at 1585 Sawdust Road in The Woodlands sector (251Z), from Stream Realty Partners LP (713-300-0300). With this lease, the newly developed building is now almost 12% leased with asking rents at $18.00 per square foot. Andy Iversen and Patrick Valentz of the Houston office of Jackson Cooksey represented the tenant, while Paul Coonrod and Brad Fricks represented the landlord in-house.
  
  

Office Financing

• A joint venture of Urdang (610-834-9500), the real estate investment arm of BNY Mellon Asset Management (212-922-7631) and Griffin Partners (713-622-7714), has secured $80.8 million for the refinancing of 1301 Fannin St (125), from MassMutual Financial Group (800- 542-6767). The 26-year-old, 784,000-square foot, Class A office building is located at 1301 Fannin Street in the Central Business District sector (493Q).  Paul House of CBRE Capital Markets and Tom Melody of Jones Lang LaSalle negotiated the loan on behalf of Urdang. The loan carries a seven-year term and a fixed interest rate
  
  
• Texas-based Live Oak Gottesman Company (512-472-5000) has secured a financial joint venture with a private real estate group for the refinancing of Southwest Science Center (18110), a 34,277-square-foot office building located at 4150 Interwood South Parkway in the Greenspoint Northbelt sector (374X). The building which was completed in 2009 is a forensics laboratory, designed and built for U.S. Customs & Border Protection – now fully occupied by General Services Administration (817-978-2321).  Dan Miller, Mona Carlton, and Trent Agnew of Holliday Fenoglio Fowler (713-852-3500) arranged the loan on behalf of Live Oak Gottesman Company.
  
  

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Retail Centers

According to the O’Connor & Associates First Quarter 2010 Houston Retail Data Program, citywide occupancy for Houston area multi-tenant retail buildings is 84.22% (Regional = 85.98%; Community = 86.69%; Neighborhood = 82.17%; Strip = 80.66%).  Occupancy is down 0.80 points over the last quarter and down 0.15 points over the first quarter 2009. The citywide quarterly multi-tenant retail rental rate is $1.61 per square foot (Regional = $2.80; Community = $1.64; Neighborhood = $1.27; Strip = $1.27).
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Note: The retail centers listed herein are followed by their representative identification number as they appear in the new O’Connor & Associates RetailLink Online Data platform and are provided for subscriber cross-referencing. The property information contained within this database is updated on a monthly basis and accessible over the web. (Please contact us for more details.)

Retail Developments

• No retail developments were recorded for the month of May.
  

The following chart illustrates historical retail occupancy.

Retail Sales

• North American Development Group (214-850-5186) has purchased Commons at Presidio Square (2142), a 189,340-square-foot retail center located at 14404 Bellaire Blvd in the Far Southwest sector (528E), from Anbil III LP, an affiliate of Camden Securities Co (914-241-4335). The 25-year-old shopping center, anchored by HEB grocery, is currently about 90% leased. Rusty Tamlyn and Trent Agnew of Holliday Fenoglio Fowler brokered the deal.
  
  
• Clayco Academy Sports #1 Ltd, an entity of Clay & Co (713-722-1250), has purchased Academy (2630), a 10-year-old, 53,780-square-foot retail facility located at 10414 Gulf Freeway in the Near Southest sector (575H), from Ray Lipson LLC.  Academy (713-944-7511), the single tenant who occupies the entire facility, has 12 years left on a 20-year triple net lease. Timothy Clay represented the buyer in-house, while San Diego office of Grubb & Ellis BRE Commercial represented the seller.
  
  
• Texas-based Ganim Long Point LLC, an entity of All Brands Cigarettes & Candy Wholesale Co (713-956-6584) has purchased Long Point Shopping Center (978), a 42,000-square-foot building located at 7922 Long Point Road in the Near Northwest sector (451T) from a California-based TUO Houston Long Point LLC, an entity of The Uhlmann Offices Inc (818-789-5700). The eight-year-old property is shadow anchored by Supermercado de Walmart. Chris Maling, David Maling and Todd A Carlson of Marcus & Millichap brokered the sale.
  
  
• Yikjune Investment LLC (713-649-2893) has purchased La Michoacana Market Center No.42 (54909), a 52-year-old, 14,000-square-foot retail facility located at 1535 Elton Street in the South Houston sector (575H), from Peterson Group (281-759-2700). Todd Carlson of Marcus & Millichap brokered the deal.
  
  
• Roade Properties Ltd (713-547-4600) has purchased 3012 Hillcroft St (54910), a 40-year-old, 12,000-square-foot free standing retail facility located at 3012 Hillcroft Street in the Near West sector (490Z), from Mody Interests LLC (713-772-6200).  Anastacio Sanchez of Sun Realty Texas represented the buyer, while Derek Hargrove and Christopher Dray of Moody Rambin Interests represented the seller.
  
  

Retail Leases

• Tucson-based Pima Medical Institute (PMI) (888-939-7462) has leased 42,297 square feet at Katy Retail Center (1584), a 70,000-square-foot retail building located at 10201 Katy Freeway in the Near West sector (490A), from Metro National Corporation (713-973-6400). PMI plans to convert the leased area into a teaching facility which will be ready for occupancy in September. James Wachholz and William Wolff of UGL Equis represented the tenant, while the landlord was represented in-house by Loch Cook.
  
  
• Michael's Stores (713-490-1421) leased 21,350 square feet in Market Square at Eldridge Parkway (3542), a 270,000-square-foot community center located at 2602-2938 Eldridge Parkway in the Far West sector (488T) for the relocation of its store from Westheimer and Dairy Ashford. The newly-developed building is nearly 89% occupied. Joan Collum of Orr Commercial represented the tenant, while Chad Moss of Property Commerce represented the landlord.
  
  
• Goodwill Industries of Houston (713-692-6221) leased 19,165 square feet in Fairmont Parkway Shopping Center (2832), a 150,000-square-foot retail center located on 5950 Fairmont Parkway in the Far Southeast sector (577H), from NewQuest Properties (281-477-4300). The three-year-old building is over 79% occupied. J Barkley Wedemeyer of Wedemeyer Realty represented the tenant, while Bob Conwell represented the landlord in-house.
  
  
• Goodwill Industries of Houston (713-692-6221) leased 18,055 square feet in Victory Lakes Town Center (3509), a two-year-old, 416,000-square-foot community center located at 1820 FM 646 in the Far Southeast sector (699A), from NewQuest Properties (281-477-4300). J Barkley Wedemeyer of Wedemeyer Realty represented the tenant, while Heather Nguyen represented the landlord in-house.
  
  

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Industrial Facilities

According to the O’Connor & Associates First Quarter 2010 Houston Industrial Data Program, citywide occupancy for Houston area operating multi-tenant industrial facilities is 84.19% (Flex = 82.75%; Bulk = 84.70%; Manufacturing = 90.51%, Service = 87.34%, Distribution = 75.31%, R&D = 85.93%).  Occupancy is down 1.29 points over the last quarter and down 1.92 points over the first quarter 2009.  The overall quarterly rental rates is $0.40 per square foot (Flex = $0.42; Bulk = $0.30; Manufacturing = $0.30, Service = $0.48, Distribution = $0.33, R&D = $0.76).
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Note: The industrial facilities listed herein are followed by their representative identification number as they appear in the O’Connor & Associates IndustrialLink Online Data platform and are provided for subscriber cross-referencing. The property information contained within this database is updated on a quarterly basis and accessible over the web. (Please contact us for more details.)

The following chart illustrates historical industrial occupancy.

Industrial Developments

• GRA-Gulf Coast Construction (713-934-7797) is developing a 115,000-square-foot, build-to-suit manufacturing facility for Neopal (281-219-9600). The facility will be located on 13 acres of land at the intersection of Vickery Drive and Aldine Bender (374Y). Chris Caudill and Joel Michael of NAI Houston negotiated the deal.
  
  
• Tennessee-based NA Industries Inc (423-624-6496), a subsidiary of the Japanese company Nippon Shokubai Co Ltd, is developing a 10-acre site in the Bayport area in Pasadena to construct a $100 million dollar polymer plant. The plant will manufacture superabsorbent polymers; it is expected that the annual output will be 60,000 metric tons. Construction is expected to start in September and build out in 2012.
  
  

Industrial Sales

• Bonner Investment Properties LLC has purchased Kempwood Industrial Park (3949), a 45-year-old, 48,000-square-foot warehouse located at 7905 Blankenship Drive in the Near West sector (451N), from Antoine Investments LLC (281-859-3074). Chris Kugle, John Ferruzzo and Dustin Gillioz of NAI Houston represented the buyer, while Joe MacDougall of Joe MacDougall & Co represented the seller.
  
  
• CAP Barbell Inc (713-977-3090) has purchased 1121 Westpark Dr (37263), a 10-year-old, 38,000-square-foot warehouse located in the Near Southwest sector (529C), from Mr. Dominique Morel.  Steve King of CB Richard Ellis and Michelle Shen-O'Brien of Camelot Realty Group represented the buyer, while Bill Rudolf and Gray Gilbert of CB Richard Ellis represented the seller.
  
  
• Walton Roofing (713-674-9777) has purchased 8350 Mosley Road (2809), a 46-year-old, 30,000-square-foot office/warehouse facility located in the Far South sector (575H), from Airgas Southwest Inc (713-947-5193).  Chris Caudill and Joel Michael of NAI Houston represented the buyer, while Troy Collins of Holt Lunsford Commercial represented the seller.
  
  

Industrial Leases

• Exel Logistics (713-673-7108) has renewed its lease of 8607 City Park Loop (886), a 31-year-old, 128,000-square-foot warehouse located in the Near Northeast sector (455T), from The Realty Associates Fund VIII (617-476-2700). Sam Brown of Sam H. Brown Inc represented the tenant, while Edward Bane of Holt Lunsford Commercial represented the landlord.
  
  
• Phoenix of Texas LLC (317-884-3600) has leased 66,000 square feet in Sugarland Business Park (5910), an 11-year-old, 316,000-square-foot manufacturing facility located at 12610 Airport Boulevard W in the Far Southwest sector (568G), from Cobalt Industrial REIT II, a private REIT managed by Cobalt Capital Partners (972-893-7000).  Beau Kaleel of Cushman & Wakefield represented the tenant, while Jude Filippone of Transwestern Commercial Services represented the landlord.
  
  
• Associated Global Systems (516-627-8910) has leased 42,000 square feet in Ja Green International Cargo Center West (5754), a 334,000-square-foot office/warehouse facility located at 2928 Greens Road in the Far North sector (374N), from AMB Property Corporation (214-702-7020).  Glynn Mireles of CB Richard Ellis represented the tenant, while Kyle Valentine of Stream Realty Partners represented the landlord.
  
  
• Roadsafe Traffic Systems, Inc (281-227-0104) has leased 12390 State Highway 249 (5333), a 22,000-square-foot office/warehouse facility located at 12390 State Highway 249 in the Near Northwest sector (411C), from M L T Investment Corp.  Brandi McDonald and Valerie Palmquist of Transwestern represented the tenant, while Travis Land, Michael Keegan, and John Ferruzzo of NAI Houston represented the landlord.
  
  
• Pegaso Properties (713-598-3733) has leased 20,000 square feet in 3375 W 11th St (4570), a 35-year-old, 40,000-square-foot warehouse located in the Near South sector (492A), from West 11th Street Warehouses, an entity of Abco Properties Inc (713-225-1354).  Thomas Leger, Robert McGee and Mike Spears of The National Realty Group represented both the tenant and the landlord.
  
  
• Seawell Americas (713- 896-7430) leased 18,945 square feet in 11995 FM 529 (4951), a 14-year-old, 23,000-square-foot office/warehouse facility located at 11995 FM 529 in the Near Northwest sector within Northwoods Industrial Park, from The Texas Development Co (713-937-0303).  Lane Guinn of JLM Commercial Advisors represented the tenant, while Stephen Marmion represented the landlord in-house.
  
  
• Goodman Distribution (713-861-2500) leased 18,000 square feet in Park 10 Distribution Center (3713), a 30-year-old, 153,000-square-foot office/warehouse facility located at 1325 South Creek Drive in the Far West sector (447X), from InSite Realty Partners (713-339-1300). Doug Nicholson and John Nicholson of Grubb & Ellis represented the tenant, while the landlord was represented in-house.
  
  
• Summit Downhole Dynamics has leased 11,250 square feet in Westgreen Business Center – Bld (6 & 8) (37480), a two-year-old, 22,000-square-foot warehouse facility located at 1402 Vanderwilt Lane in the Far West sector (446W), from Juban Enterprises Corp (713-960-8888). Guy Brown of Poynter Commercial Properties represented the tenant, while Chris Kugle, Dustin Gillioz, and John Ferruzzo of NAI Houston represented the landlord.
  
  

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Vacant Land

• Mallick Group (817-763-0700) has purchased 104 acres of land, located on the South Loop between Fannin Drive and Kirby Avenue (532V), from Angel/McIver Interests (936-756-6337). The site was the former location of the Astroworld Theme Park owned by the Six Flags Corporation. The theme park had been demolished in 2005 and the site sold to the current seller. The latest owner plans to use the site for mixed-use development.
  
  
• Byrne Investments LLC (440-238-9552) has purchased 12.5 acres as well two on-site buildings totaling 12,000 square feet located at 501 N FM 3083 E in the Far North sector in Conroe (158J) from BKR 3083.  N Trey Halberdier and Rob Banzhaf of Bandier Realty Partners represented the seller.
  
  
• Halliburton Energy Services (281-575-3000) has purchased 11.1 acres, located at the southwest corner of North Sam Houston Parkway East and Morales Road near the Greater Greenspoint area (374S) from Richard N Gould, Trustee.  Mark Nicholas of Jones Lang LaSalle represented the buyer, while Dan Perrier of Perrier Properties and Richard Gould of McDade, Smith, Gould, Johnston, Mason, and Company represented the seller.
  
  
• Jung Kwak has purchased 10.6 acres of land on Highway 35 in Pearland (493Q) from Pitsenbarger Living Trust.  Bill Treadway of W.M. Treadway & Associates and Jason Scholtz of Curtice Commercial Real Estate represented the seller.
  
  
• ABC Eastex Land LLC has purchased 5.5 acres of land at the northeast corner of US 59 North and Hamill Road from Satex Land Inc. Jorge Zuluaga of ABC Eastex Land LLC represented the buyer while Richard Pevey represented the seller and Stewart Title Commercial closed the deal.
  
  

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Economic & Financial News

The total number of nonagricultural wage and salary jobs in the ten-county Houston area increased by about 1,200 jobs to 2,507,900 in April 2010, according to the U.S. Department of Labor.  This month’s total is 40,900 fewer jobs than the 2,548,800 jobs at this time last year. Of nonagricultural employers, the Leisure and Hospitality sector posted the largest gain over the month at 1,900 jobs, while the largest year over year increase occurred in the Education and Health Services sector, which added 12,600 jobs.

The following chart illustrates total non-agricultural employment in the Houston MSA.

Source:  Bureau of Labor Statistics (BLS)

Advance estimates reported by the U.S. Department of Commerce show that seasonally adjusted national retail and food services sales for April were $366.4 billion, an increase of 0.4% from March and 8.8% above April 2009. Retail trade sales in April were up 0.5% from March and 9.6% above last year’s level.

Personal income increased $54.4.0 billion, or 0.4%, and Disposable Personal Income (DPI) increased $57.6 billion, or 0.5%, in April 2010, according to the Bureau of Economic Analysis.  Personal Consumption Expenditures (PCE) increased $4.0 billion, or less than 0.1%, in April. Meanwhile, the U.S. Department of Labor reports that the seasonally adjusted Consumer Price Index (CPI) for urban consumers decreased 0.1% in April and is 2.2% higher than April 2009.

The latest Conference Board Survey indicates that the Consumer Confidence Index increased to 63.3 in May 2010, up 5.6 points from April. The index is an indicator of consumers’ overall assessment of current conditions, relative to a figure of 100 in 1985, the base year. The Index of Leading Economic Indicators decreased 0.1% in April, following a 1.3% increase in March, and a 0.4% increase in February. The index is an indicator of direction the economy is expected to take in coming months, relative to a figure of 100 in 1996, the base year.

According to the Federal Reserve, industrial production increased 0.8% in April 2010 from previous month and is up 5.2% from the April 2009 level. Output in the manufacturing sector increased 1.0%, output at mines increased 1.4%, while output of utilities decreased 1.3% in April. The rate of industrial capacity utilization was 73.7% in April, which is up 0.6% from March’s revised level but down 1.3 points compared to the previous year’s level.

Freddie Mac reports that the 30-year fixed-rate mortgage (FRM) averaged 4.89% in May 2010, down 0.21 points from April 2010 and up 0.03 points from one year ago. The average for the 15-year FRM averaged 4.28% in May 2010, down 0.14 points from April 2010 but down 0.10 points from May 2009.

The Bureau of Economic Analysis (U.S. Department of Commerce) reports that second estimate of the real GDP, the output of goods and services produced by labor and property in the United States, increased at an annual rate of 3.0% in the first quarter of 2010. This increase in GDP in the first quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, private inventory investment, and nonresidential fixed investment.

The U.S. Department of Commerce reports that construction spending during April 2010 was estimated at a seasonally adjusted annual rate of $869.1billion, which is 2.7% above the revised March estimate ($845.9 billion). The current figure is 10.5% below the April 2009 estimate of $971.4 billion. Private residential construction was at a seasonally adjusted annual rate of $263.0 billion in April, 4.4% above the revised March estimate of $251.9 billion.

The Baker Hughes count of active domestic rotary rigs stands at 1,513 for May 2010. The current rig count is up 64.8% from last year’s figure of 918 rigs. The rotary rig count is a census of the number of drilling rigs actually exploring for or developing oil or natural gas in the United States.

The National Restaurant Association’s Restaurant Performance Index(RPI) stood at 100.4 in April, down 0.1 percent from the previous month. The index is a monthly composite index that tracks the health and outlook for the U.S. restaurant industry. This is the second consecutive month in which the RPI posted above 100.

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Potpourri

According to the monthly Monster Worldwide Inc Employment Index, online job demand increased by one points in the month of May 2010. The index currently stands at 134 and is 16 points above May 2009, an increase of 13.6%. Online demand for workers increased in 15 of the 28 major U.S. metro markets.

According to the April 2010 Architecture Billings Index, developed by the American Institute of Architects, April reported an index of 48.4, up 2.3 points from the previous month (any score above 50 indicates an increase in billings). Both the project inquiries index and the inquiries for new projects score was 59.6.

5 Houston Center (158), a 580,875-square-foot, Class A office tower owned by Wells REIT II (770-449-7800), has been awarded LEED™ Gold certification by the U.S. Green Building Council. Sustainable features currently at the property include recycling of all nonfood waste, a new irrigation system to reduce water use, and use of environment-friendly cleaning products. The 27-story, eight-year-old tower, with Ernst & Young anchoring the tenancy, is located at 1401 McKinney Street in Central Business District (493Q).

Houston witnessed several new appointments to executive-level positions of its commercial real estate firms, during the month of May.  Terry Williamson, previously Vice President of Estimating, took over from Patrick Manning as President and CEO of Texas Sterling Construction Co, the Houston-based subsidiary of Sterling Construction Company Inc (281-821-9091).  Ed Cummins and Clint Duncan, both previously with Hendricks & Partners, and Lupe Olivares, previously with CB Richard Ellis, joined Transwestern (713-27-7700) as part of the company’s multifamily services group for the Houston area.  Cutt Abelsonand Jonathan Gilfillan, both previously with Grandbridge Real Estate Capital LLC (FKA Live Oak Capital), joined Berkadia Commercial Mortgage LLC (713-821-1589) as Senior Vice President for the company’s Houston office.  Robert Duncan, founder of Transwestern, was elected to the Texas Business Hall of Fame former inductees of which include President George Bush.  Johnny Hendrix has been promoted to Executive Vice President and Chief Operating Officer of Houston-based Weingarten Realty (713-866-6049).  Cheri Fama, previously with Heritage Texas Properties, joined John Daugherty, Realtors (713-626-3930) as Executive Vice President and Chief Operating Officer.  Justin Bennett and Sequoya Nelson joined the Houston office of DCT Industrial (972-982-8550) as Vice President/Regional Market Representative and Senior Property Manager, respectively.  Rand Stephens and Josh LaRocca, both previously with Mohr Partners, joined the Houston office of the Canada-based Avison Young (514-940-5330) as Managing Director and Principal, respectively.

Please direct any questions regarding content in the Houston Real Estate Trends to Holly Kelch at 713-686-9955 or hkelch@poconnor.com.

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