ALAMO CITY OFFICE MARKET LOOKS BRIGHT
SAN ANTONIO (San Antonio Express-News) -- A report from Delta Associates and Transwestern released this week paints a rosy picture for the city's office market for the next two years.
Almost 1.4 million square feet of office space is under construction or renovation here. Office space demand increased during the first half of this year, although vacancy rates remained steady.
The city's unemployment rate is 3.6 percent, the lowest since late last year. The San Antonio market absorbed 545,000 square feet in the first six months of this year, surpassing the 481,000 square feet absorbed in all of last year.
The office vacancy rate of 10.6 percent is higher than the 10.3 percent national average but lower than Dallas and Houston.
Office rents are going up. The average for space is ten years old or lower is $20.87 per square foot. That is up from $20.65 at the end of 2006.
"It is one of the most robust office markets that San Antonio has seen," said Kevin Roberts, Transwestern's executive vice president for the Central Texas region.
PLANO PRESTON PROPERTY PART OF PACKAGE
PLANO (Houston Business Journal) -- Preston Shephard Place has been sold as part of a $150 million package. A joint venture of Weingarten Realty Investors and PNC Realty Investors bought the retail center along with ones in Alpharetta, Ga., and Stuart, Fla.
PNC made the deal on behalf of its institutional client, the AFL-CIO Building Investment Trust. The joint venture is 80 percent owned by the building investment trust and 20 percent by Weingarten, which will also handle property management and leasing.
PARTNERS ENVISION LEANDER DEVELOPMENT
LEANDER (Austin American-Statesman) -- An $11.5 million bid was the top offer for 942 acres of the Kutscher Ranch near here. The buyers included investor and land developer John Lewis and Leander Mayor John Cowman.
Lewis and Cowman envision a high-end residential development on the rolling ranchland. Closing is set for Sept. 10.
Cowman is in the partnership as a private real estate broker and developer. He said he will recuse himself from any city council votes involving the land, which he anticipates Leander will eventually annex. The property is in the city's ETJ.
ALABAMA COMPANY BUYS HOUSTON PROPERTY
HOUSTON (Summit Asset Management) -- Summit Asset Management of Montgomery, Ala., has purchased the 291-unit Summit Point Apartments. The company plans to spend more than $6.1 million for rehabilitation of the property.
Both interior and exterior renovations are planned, including renovated and upgraded kitchens and bathrooms, landscaping, exterior upgrades and maintenance and parking lot resurfacing.
The purchase is Summit's tenth in Texas. Houston Income Properties and KET Enterprises of Houston brokered the transaction.
WATERING THE FUTURE
UVALDE COUNTY (San Antonio Business Journal) – About 7,550 acres of the historic Annandale Ranch will be purchased by the San Antonio Water System (SAWS) for $4 million.
Crossing the west side of SH 127 near the intersection of FM 2690 just west of San Antonio, the land will become a conservation easement to limit future development and protect the Edwards Aquifer recharge zone.
"There are 25 documented sensitive recharge features, such as caves and sinkholes, at the Annandale Ranch," says Bruce Haby, manager of SAWS' corporate real estate. "The ranch also contains approximately 4.5 miles of Frio River frontage. More recharge is occurring in the Frio and Dry Frio basins than in any other recharge zone . . . . "
In 1999 and 2002, SAWS, the Edwards Aquifer Authority and the Nature Conservancy of Texas bought separate conservation easements on 4,055 acres at the Annandale Ranch.
The ranch was established in the 1880s by Louis Washington Florea and totals more than 12,000 acres.
Protecting Texas’ water sources is discussed in Tierra Grande’s recent issue. “Big Gulp” describes the 2007 State Water Plan.
KANSAS CITY LIKES KILLEEN
KILLEEN (KC Venture Group) -- Two multifamily properties here have been purchased by affiliates of KC Venture Group LLC of Kansas City, Mo. The properties purchased were the 160-unit Twin Creek Apartments and the 214-unit Copper Mountain Apartments near Fort Hood.
"The properties require some work to cure deferred maintenance and improve curb appeal keeping in the spirit of KCVG's continuing focus on adding value to its assets," said Texas-based Vice President of Acquisitions Susan Pohl.
KCVG is actively seeking Class-A, -B and value-added multifamily properties in the Southwest, Midwest and Southeast.
CARACOL GRAND OPENING
PORT O’CONNOR (mmihouston.com) – Tomorrow, Trend Development Inc. and Forestar Real Estate Group will host the grand opening of their upscale master-planned community, Caracol.
Bounded by the Intracoastal Waterway, the new development has 74 home sites, 70 of which have canal frontage with access to the Gulf of Mexico.
Home sites begin in the $100,000’s. Plans for the second phase of Caracol include a midrise condo community on a marina.
MOLD: HERE WE GO AGAIN
COLLEGE STATION (Real Estate Center) -- Receding flood waters are good news. The mold that is left behind is not.
"The Video Book of Mold" includes interviews with experts who help uncover the truths about the green menace. Topics include:
- where and why mold flourishes and how to inspect for it.,
- who should be concerned about mold exposure,
- what Texas homeowner's insurance policies cover,
- how mold affects home value and
- how homeowers can clean up small mold problems.
Available in VHS or DVD formats for only $10, the videos can be ordered online at http://recenter.tamu.edu/store//.
CANADIAN CURRENCY BUYS CROSSWINDS
HOUSTON (globest.com) – Sterling American Property Inc. has sold the 240-unit Crosswinds Apartments to an Ontario investor.
The Class-B, 24-year-old Crosswinds is on almost nine acres at 14810 Crosswinds Dr. and has one-and two-bedroom units ranging from 479 to 1,033 square feet. Monthly rents range from $419 to $700.
The 84 percent-leased complex was sold with a pro forma cap rate of 8.3 percent. Cushman & Wakefield of Texas Inc. assisted in negotiations.
CALIFORNIA MONEY BUYS AUSTIN OFFICES
AUSTIN (Austin Business Journal) -- Triple Net Properties LLC is the new owner of two Austin office buidlings. The California-based company purchased the 433,024-square-foot 816 Congress property downtown and Avallon, a 318,217-square-foot building in northwest Austin.
The sales price was $82.5 million. Crescent Real Estate Equities Co. was the seller. Crescent has been purchased by Morgan Stanley Real Estate for $6.5 billion.
SALES DOWN BUT PRICES HOLDING
DALLAS (The Dallas Morning News) – New-home sales were down more than 17 percent in the second quarter, and sales of pre-owned homes were off 15 percent in June. The biggest drop in new-home sales was in homes below $150,000.
"What we are seeing more than anything is the impact of the tightening of the subprime market," Mr. Brown said. "Some of those buyers probably shouldn't be buying."
During the first half of 2007, the median sales price of pre-owned homes was up 1 percent from a year earlier to $150,000, primarily because fewer low-cost homes were changing hands.
Builders started 8,568 single-family homes in the quarter -- down almost 40 percent from a year earlier, according to statistics by housing analyst Metrostudy Inc. Builders sold 9,774 homes in the just-completed quarter -- the lowest total in more than two years.
With the cutback in construction, the number of unsold new homes in the area has declined to just under 11,000. About 13,000 single-family homes were under construction in North Texas, compared with about 18,000 a year ago, according to Metrostudy.
The supply of homes for sale is down from same time last year’s eight months to about seven months.
DOWN IN THE VALLEY
McALLEN (McAllen Monitor) -- Fewer building permits have been issued here this year than since 2001.
The Rio Grande Valley housing decline is blamed on an overbuilt market and more conservative mortgage lending.
"There is a real dearth of housing starts, and I think that is really associated with the more stringent requirements on lenders," said Brownsville developer Bill Hudson.
The number of new home permits fell 33 percent in the Valley during the first five months of this year compared with 2006. Valley cities registered 3,619 residential building permits compared with 5,465 during the same time last year.
Some industry experts say the area is not in a housing slump but merely returning to normal pre-housing-boom levels.
COMMUNITY TAKES ROOT
CYPRESS (Houston Chronicle) – General Growth Properties Inc. is developing the 10,000-acre resort-style Bridgeland community, which will ultimately include more than 21,000 single-family homes with 65,000 residents, said Peter Houghton, Bridgeland's vice president for sales.
The majority of Bridgeland, which is 2.5 miles south of U.S. 290 on Fry Road, is in the Cypress-Fairbanks Independent School District.
The community is divided into Lakeland, Parkland, Prairieland and Creekland villages. About 400 homes in the $160,000 to $1 million price range have been sold.
A 1,000-acre town center will rise along the Grand Parkway near North Bridgeland Lake Parkway and will include office, medical facilities, retail, education centers and entertainment. About 3,000 acres has been set aside for recreation or conservation, including nearly 900 acres of lakes, creeks and trail systems.
RENEWING THE REINSURANCE
TEXAS (Houston Chronicle) – The Texas insurance commissioner approved an order letting the state's windstorm insurer of last resort buy $1 billion of coverage for itself.
The Texas Windstorm Association, created to sell insurance along the coast, will pay between $150 million and $160 million for the reinsurance, said association spokesman Jerry Johns.
Reinsurance is coverage insurance companies buy to pay claims in the event of a catastrophic storm. The association's old policy expired June 1.
Many private insurance companies have stopped providing windstorm coverage for coastal counties and begun limiting coverage in those that are one county inland. This caused the insurance policies sold through the association to more than double from almost 68,000 in 2001 to nearly 182,000 as of last month.
Visit the Real Estate Center’s website to read articles concerning tidal insurance and other insurance issues facing homeowners.
BUILDING FOR RESEARCH
SAN ANTONIO (San Antonio Express-News) – DGD Research will construct the Diabetes and Glandular Disease Clinic in the city's medical center. The clinic will be the world’s largest private diabetes research center.
When the 80,000-square-foot building is complete, it will have 100 beds for cutting-edge inpatient research and room for hundreds of outpatient visits. DGD expects to add about 200 employees in the next five years.
The center is slated to open next February.
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