HOUSTON – Developers have shelved plans to build some 50 multifamily projects in Houston, where a sharp drop in oil prices has dampened the local economy, according to Patrick Duffy, president of Colliers International in Houston.
“We’ve heard 50 multifamily projects have been cancelled or postponed,” Duffy said in remarks to the CoreNet and IFMA luncheon in Houston.
Houston has strong multifamily occupancy, in excess of 91 percent and monthly rents are over $1 per square foot. But there have been layoffs in the energy industry in the wake today’s weak oil prices.
However, there is no crisis and tenants aren’t fleeing. “No one is walking in and saying ‘I just lost my job. I need to break my lease,’” says Ryan Epstein of CBRE.
The Houston market delivered 17,628 new units in 2014 and that will rise to 20,000 new units in 2015. But in the next two years – 2016 and 2017 – very few new units will be coming on the market, Epstein said.