Friday , 5 June 2020
Breaking News

Sales Up 127 Percent in Evolving Houston Sector

HOUSTON – (Realty News Report) – Warehouses are a hot item in Houston.

Warehouse sales are up 127 percent year-to-date over the sales volume of 2016, according to a November report by NAI Partners.

Houston is poised to break the $1 billion barrier soon. So far this year $984 million in industrial sales have been recorded.

Institutional investors have accounted for 38 percent of the deals, while 12 percent of the buyers were REITs and 10 percent were foreign investors.

NAI reports the largest transaction of the year was Pure Industrial REIT’s $63.5 million purchase of the 1 million-SF IKEA Distribution Center in Baytown. The REIT is based in Vancouver, B.C.

Another Canadian firm, WPT Industrial REIT of Toronto, paid $40 million to buy the Apex Distribution Center on Brittmoore Road. Other big deals included the sale of the Park 288 project, Mason Creek Business Center and a 331,000-SF project at 1601 Gillingham in Sugar Land.

The activity comes as Houston has moved into the big leagues of industrial development. With e-commerce, population growth and expansion at the Post of Houston and the Panama Canal an increase in major container traffic from Asia is occurring. On the retail front, Amazon has two new large fulfillment centers and Amazon Fresh is coming in with a food warehouse. Big retailers such as Best Buy, which is building a 550,000-SF distribution center, are constructing “big box” warehouses in the Houston area.

Previously, as part of an ill-reasoned but long-lasting logistics tactic, Dallas was considered the region’s major distribution hub. For years, goods would be shipped into the Port of Houston, transferred in bulk to Dallas, broken down into smaller units and re-shipped back to Houston.

Robert Clay

“To be honest, I never totally understood why Dallas is so much more of a distribution hub than Houston,” Houston developer Robert Clay of Clay Development and Construction told Realty News Report in a recent interview. “We have basically the same population and yet, Dallas is around twice the size of Houston. My opinion is that instead of five major distribution markets around the U.S., there are now 10 less-major markets and Houston is one of those.”

The Houston industrial market has been digesting the wave of new construction. Some 6.4 million SF has been absorbed year-to-date, according to NAI Partners November report. The current vacancy rate is 5.5 percent.

Nov. 30, 2017 Realty News Report Copyright 2017

Leave a Reply

Scroll To Top
%d bloggers like this: