Houston New Home Prices Lead Texas In Gains

TEXAS (HomesUSA.com) – February 26, 2019 – The average new home price in Texas rose by nearly $1,500 to $358,880 in January, according to HomesUSA.com

The average price of a new home rose in Texas’ four largest markets in January, with Houston leading the gains, according to the the HomesUSA.com New Home Sales Index. Sales activity, meanwhile, fell slightly in Houston, mirroring the statewide trend.
Houston-area new home prices rose by $3,809 to an average of $361,231 in January, a gain of 1 percent from the prior month. San Antonio prices rose by $1,057, 0.4 percent, to $297,248. The average price in Austin rose by $195 to $368,931, while the Dallas average went up by $44 to $375,930.

The average new home price statewide rose by $1,446 to $358,880 in January, up 0.4 percent from $357,434 in December, according to the survey. The index tracks a 12-month rolling average of sales based on data from local Multiple Listing Services in Houston, North Texas, San Antonio and Austin.

Sales volume in the four largest markets was essentially flat in January compared December, with with each city experiencing a drop of six or fewer transactions.

“We’ve been on a record-breaking pace for new home sales for so long, it’s not surprising to see that the market appears to be leveling off,” HomesUSA.com owner Ben Caballero said in an announcement. “But we also are about to head into the spring sales season.”

HomesUSA.com lists and sells houses for more than 60 homebuilders in Texas.

Houston Office Market Has Positive Net Absorption

HOUSTON (NAI Partners) – February 25, 2019 – After peaking at 22 percent in 2Q 2018, local office vacancy fell to 21.1 percent this month, according to ​NAI Partners.
So far, year-to-date 2019 net absorption is in positive territory at 762,230 sf.

The metro created 108,300 jobs, a 3.5 percent increase, in the 12 months ending December 2018. The five sectors adding the most jobs in 2018 were:

  • construction (19,400);
  • administrative and support services (16,800);
  • durable goods manufacturing (15,500);
  • professional, scientific, and technical services (11,200); and
  • health care (11,100).

The city’s west side (Energy Corridor) is continuing to see positive forward movement, underscored by the sale of Eldridge Place, a three-building, 824,632-sf office complex purchased by Granite Properties for $78.4 million from TIER REIT.

Chevron, Exxon Mobil Sink Billions into Texas Refineries

HOUSTON (Connect Daily Texas) – February 1, 2019 – Two of the nation’s largest oil companies are doubling down on Texas, pouring billions of dollars into refineries.

Chevron USA Inc. has inked an agreement with Petrobras America Inc. to acquire Pasadena Refining Systems Inc. for $350 million. The deal includes all outstanding shares and equity interests, as well as the 192-acre refinery in Pasadena, TX, located on the Houston Ship Channel. The refinery (pictured above) marks Chevron’s first in the Lone Star State.

Meanwhile, Exxon Mobil announced it will begin construction on an expansion of its Beaumont refinery that will make the facility the largest refinery in the nation. The Irving, TX-based company plans to increase the refinery’s capacity by 250,000 barrels per day, or roughly 65%.

Exxon Mobil expects to create 1,850 jobs during construction of the expansion, and add 40 to 60 jobs in the area once it is complete in 2022. At that time, the refinery will be able to process more barrels of crude oil than any refinery in the United States.

“The Gulf Coast is a really good area for refining in general,” said Matthew Blair, head of refiners research at Tudor, Pickering, Holt & Co. “It’s one of the most cost advantageous locations for refineries in the world.”

After 29 Months of Economic Expension Needle Moving Neutral

HOUSTON (Houston Chronicle) – January 15, 2019– A near-term forecast indicates continued overall economic growth in Houston but warns that manufacturing growth may slow over coming months.

The Houston Purchasing Manager’s Index reported that manufacturing activity in Houston expanded in December for the 15th consecutive month, and overall economic activity expanded for the 29th month.

The index registered at 53.3, down from 54.9 in November. Readings over 50 generally indicate expansion; readings below 50 show contraction.

The index’s readings for Houston’s employment and lead times, two of three underlying indicators tied to economic activity, showed continued strength. ​

The third indicator—the sales and new orders index—fell below neutral for the first time in 13 months.

The three-month forecast for the Houston index registered 49.8, down 3.3 points from its November reading of 53.1.

Weakening sales/new orders, production, and lead times, which are all directly tied to economic activity, were the primary drivers for the fall.

The institute projected continued strength during the next three months for health care and construction but expects manufacturing and wholesale trade to weaken.

Houston’s Industrial Market Closes 2018 At 10-Quarter Vacancy Low

HOUSTON (BISNOW) January 8, 2019 – Houston’s industrial market closed 2018 strong, with overall vacancy at a 10-quarter low of 5%, decreasing by 10 basis points quarter-over-quarter. Industry leaders expect the market to keep that same energy into the new year. Demand for industrial space remained healthy as 3.4M SF was absorbed in Q4, pushing the year-end total to 10.6M SF, according to CBRE’s industrial market quarterly report.

The Northwest and Southeast submarkets were particularly busy in the fourth quarter and consequently logged strong year-end totals. Northwest noted positive absorption of 2.7M SF in Q4, bringing year-end total net absorption to 5.4M SF. Southeast saw year-end net absorption of 3.2M SF with 750K SF coming in the fourth quarter.  Four of the five biggest deals last quarter were in the Southeast market.

Valvoline inked a 473K SF lease at Port Crossing Commerce Center at 1302 Wharton Weens Blvd. in La Porte. Unis signed a 248K SF lease at Bayport South Business Park at 10565 Red Bluff Road in Pasadena. NT Logistics Inc. agreed on a 226K SF lease at Ameriport Industrial Park in Houston. Smart Warehousing signed a 150K SF lease at Energy Commerce Business Park in Pasadena.  The only major non-Southeast deal in the top five was Palmer Distribution inking a 168K SF lease at Railwood Industrial Park in the Northwest submarket.

Industrial construction activity also hit a record-breaking milestone. The market saw 16.3M SF of new product break ground in 2018, which is 3.7M SF higher than the 2014 record high, CBRE reported. It was boosted by an active Q4, when 5.9M SF of industrial space was launched.

North Houston has been the major benefactor of the new activity as 5.1M SF of the 14M SF of industrial space underway is within the submarket. Vacancy in the North Houston submarket, bounded by Interstate 45, Highway 59, Highway 249 and the George Bush Intercontinental Airport, stands at 7%.

USGS Found Largest Oil&Gas Assessment Ever

​​​​WASHINGTON (U.S. Department of the Interior) – December 7, 2018 – According to the U.S. Department of the Interior, an assessment by U.S. Geological​ Survey (USGS) has found a portion of the Permian Basin contains an estimated mean of 46.3 billion barrels of oil, 281 trillion cubic feet of natural gas, and 20 billion barrels of natural gas liquids.

This is the largest ​continuous oil and gas resource potential ever assessed.​

The Wolfcamp Shale and overlying Bone Spring Formation are in the Delaware Basin portion of Texas ​​​and​ New Mexico’s Permian Basin province.

Although the USGS has previously assessed conventional oil and gas resources in the Permian, this is the first assessment of continuous resources in the Wolfcamp Shale and Bone Spring Formation. Oil and gas companies are currently producing oil here using both traditional vertical well technology and horizontal drilling and hydraulic fracturing. ​

​According to U.S. Secretary of the Interior Ryan Zinke, “Christmas came a few weeks early this year.”​

HP Does Largest Houston Office Deal of 2018

SPRING (Houston Business Journal) – November 2, 2018 – Hewlett Packard Enterprise will break ground on a two-building campus in the Springwoods Village community in fourth quarter 2019.  The company has preleased 568,000 sf for its new campus, representing the largest office deal in the Houston area this year. The project will be at the southwest corner of East Mossy Oaks Rd. and Lake Plaza Drive within ear shot of Exxon’s new massive campus. Plans include a fitness center, café, and an adjoined open courtyard space.

Houston Job Growth @ 3.9% in 2018

DALLAS (Federal Reserve Bank of Dallas) – October 23, 2018 –  “Monthly job growth has been volatile over the past few months with a weakening in July, a sharp bounceback in August,​ and then a slowing in September,” said Keith R. Phillips, Dallas Fed assistant vice president and senior economist. “Looking at the past three months, job growth was 2.4 percent—moderately slower than the 3.1 percent in the first half of the year. Jo​​​​b growth has been broad-based across metro areas with particular strength in Houston, which has grown at an annual rate of 3.9 percent over the past three months and 3.6 percent so far this year.”​​​​

Houston: Space 2.0-City Council Approves Utilities for Houston Spaceport

Houston (Houston Chronicle by Andrea Leinfelder) – October 18, 2018 – City Council on Wednesday approved more than $18.8 million for the Houston Spaceport to begin developing streets, water, wastewater, electrical power distribution facilities and other basic infrastructure.

These are necessary to attract future development to Phase 1 of the Houston Spaceport, which is located at Ellington Airport. Officials are hoping to attract a cluster of aerospace companies that can invent, develop and manufacture space technologies.

“We have been talking about this project for now over two years,” said Arturo Machuca, the general manager of Ellington Airport and the Houston Spaceport. “This type of development requires a lot of work. … Now we are ready to move into a more finite offering to potential partners.”

He said the money reaffirms Houston’s commitment to developing a spaceport.

In 2016, the Houston Spaceport opened a 53,000-square-foot Houston Aerospace Support Center. Clear Lake-based Intuitive Machines was the first — and so far only — business to open a location there in August 2016. The Houston Spaceport almost landed a Blue Origin rocket engine manufacturing facility, but it ultimately lost out to Huntsville, Ala.

One reason for Houston being runner-up was that Huntsville already had an experienced rocket engine workforce. To fix this problem, Machuca said the Houston Spaceport is in talks with San Jacinto College to open a location at the spaceport and help create a pipeline of talent for future companies.

Construction in Phase 1 will also eventually include a co-working space near the Houston Aerospace Support Center.

The money approved for the project includes a $1 million federal grant. The remainder will be paid through Houston Airport System revenues.

USA Largest Loop: Grand Parkway Expansion Underway

HOUSTON (Houston Chronicle) October 9, 2018 -– Members from the Grand Parkway Infrastructure met this month to discuss the continued expansion of the $1.28 billion toll road project.

The next phase, an $894 million project, will be the largest highway loop in the United States when it is completed, according to the Texas Department of Transportation.

When completed in 2022, the highway will enable drivers to travel from Baytown to League City in a loop that passes through New Caney, Spring, Tomball, Cypress, and Sugar Land.

The construction will help the region prepare for continued population growth. This phase of the project will be broken into three segments.

The Grand Parkway spans more than 50 miles around the Greater Houston area and falls within Chambers, Harris, Liberty, and Montgomery Counties.