RECON for January 31, 2020RECON for January 31, 2020Bryan PopePope

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Dr. Jim Gaines presenting to a crowd in College Station
At the Bryan-College Station Chamber of Commerce's 2020 Economic Outlook Conference Wednesday, Real Estate Center Chief Economist Dr. Jim Gaines called Texas' 2019 GDP growth "outstanding," registering over 4 percent growth compared with 2.1 percent for the U.S. For more insights from our research staff, read our 2020 Texas Housing & Economic Outlook report. (Photo by Center Photographer JP Beato.)
January 31, 2020

JCHS: More Texas renters struggling to afford housing

​​​​​CAMBRIDGE, Mass. (Texas Tribune) – The percentage of Texas' renting households that spend more than 30 percent of their income on housing is rising at a faster rate than the state’s population​, according to an analysis from the Harvard University Joint Center for Housing Studies (JCHS). 

In 2008, 1.3 million Texas households that rent were moderately or severely cost-burdened. By 2018, that number rose to 1.7 million. That's nearly half of Texas renters. 

"In terms of other states, this is kind of in the middle of the pack," said JCHS Research Associate Whitney Airgood-Obrycki. "But Texas is seeing affordability pressures grow maybe faster than the rest of the country."

"Housing costs, including rents, have risen more rapidly than household incomes," said Real Estate Center Chief Economist Dr. Jim Gaines. "Consequently, this has put a burden on households in terms of the percentage of income they have to apply toward housing costs."

Gaines said the average effective rental rate in Texas' major metros is well over $1,000 a month.

Meanwhile, the number of renter households in Texas is growing at twice the rate of owner households. According to the report, this can have long-term effects on families’ wealth, as the number of people that gain equity through home ownership decreases. 

One​​ reason for the state's high percentage of renters, Gaines said, is Texas' high number of young residents. He said many are simply at an age where they're more inclined to rent, plus many are in a tough position to come up with a down payment for a home.

​Additionally, Airgood-Obrycki​ said that while new housing is being built across the state, almost none of it is affordable. ​
Monthly Review of the Texas Economy infograhpic
For more, read our latest Monthly Review of the Texas Economy.

City moves forward on 2,122-acre Austin Green 

AUSTIN (Connect Media) – The city's Environmental Commission has approved a public utility district for Austin Green​, a 2,122-acre master-planned community at SH 130 and Harold Green Rd.

The Austin Green development calls for: 
  • 12,000 homes and apartments,
  • 600,000 sf of office space,
  • 300,000 sf of light industrial space,
  • 150,000 sf of medical and dental office space,
  • 708 acres of open space, and
  • a three-acre fire station.
GroundWork Development is the project developer.​

The 30-year buildout will cost an estimated $6.6 billion. 
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Space City industrial vacancy up, leasing down in 4Q2019

HOUSTON (Colliers International) – The average industrial vacancy rate increased 150 basis points on an annual basis from 5.4 percent in 4Q2018 to 6.9 percent in 4Q2019, according to Colliers International.  

At the end the quarter, the area had 38.8 million sf available for direct lease and an additional 2.2 million sf for sublease. 

The market posted 2.4 million sf of positive net absorption in 4Q2019, pushing the year-end total absorption to 8.7 million sf.

The majority of the area's positive net absorption occurred in the Northwest Corridor, recording 2.2 million sf. 

According to CoStar Property, the citywide rental rate average for all product types decreased from $7.76 per sf NNN (triple net) to $7.52 per sf NNN over the quarter.

The market’s leasing activity decreased over the quarter from 7.2 million sf in 3Q2019 to 5.7 million sf in 4Q2019. This decrease in leasing activity can be attributed to more owner/users in the market. 

Currently, 18.3 million sf is under construction, with 38.9 percent preleased.
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Boston buyer picks up 300-unit Legacy apartment tower

PLANO (Dallas Morning News) – Intercontinental Real Estate Corp. purchased the 25-story Kincaid at Legacy apartment tower on the Dallas North Tollway near Legacy Dr.

Completed in 2018, the 300-unit high-rise was developed by Trammell Crow Co.'s High Street Residential division and Principal Real Estate Investors.

Rents start at $1,500 a month, with apartments ranging from 677 to 4,500 sf.

Amenities include a 2,383-sf fitness center, resident lounge, billiard room, entertainment kitchen, conference rooms, business center, two swimming pools, and a seventh-floor amenity deck.

The acquisition was financed with a $73.75 million loan from Capital One National Association.
market viewer screen shotTexas Realtors' MarketViewer tool helps members and their clients quickly understand the market statistics in their area. This powerful tool is a member benefit available exclusively to Texas Realtors and local Realtor associations in Texas. Data are compiled and analyzed through a research agreement between Texas Realtors, the Real Estate Center, and all MLSs across the state. 

Canyon ISD receives 51-acre donation for new high school 

AMARILLO (News Channel 10) – The Attebury and Boyce families have donated over 51 acres to Canyon Independent School District for a new high school at Arden and Helium Roads.

The city is helping with water and sewer logistics and working with the school district to improve Arden Rd. The city and the Texas Department of Transportation are also expanding the loop.

The $87.7 million high school will open in August 2022. 

Children’s Medical Center Plano expanding 300K sf

PLANO (Connect Media) – Children's Medical Center Plano has announced a 300,000-sf expansion of its campus on Preston Rd.

The new tower will boost the medical center's total bed count from 70 to 240.

The pediatric health provider, which opened this campus in 2008, will start the​​ tower by the end of 2020, with completion expected by 2023. 

Construction costs are estimated at several hundred million dollars.

HKS is the project architect.
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Texas Tech grad student housing complex starts

​​​​LUBBOCK (KCBD TV) – The Regents at 1212, a graduate student housing complex at 9th St. and Ave. L, has broken ground. 

The $40 million property will have 225 rooms, a ​courtyard, and parking garage. ​​

The complex is being privately developed by NCM Developments, but is a collaborative project between the city, Texas Tech University, and the Texas Tech Health Science Center.

200K-sf Houston retail center slated for fall 2020

HOUSTON (REBusiness Online) – Fidelis Realty Partners has begun construction on Brookhollow Marketplace, a 200,000-sf retail center on the site of the former Exxon campus.

​Fidelis acquired the site at the corner of SH 290 and Dacoma St. in 2016. Demolitions have been completed.

Brookhollow Marketplace will house retailers such as Burlington, Michaels, Ross Dress for Less, T.J. Maxx, Ulta, Old Navy, Rack Room Shoes, and Five Below. 

Store openings are slated for fall 2020.
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