The third annual Boyar & Miller Breakfast Forum was a chance for industry experts to offer real estate predictions, given current economic conditions. Retail developer Ed Wulfe notes a new approach to retailing — the development of mixed-use projects, combining retail, residential, office and hotel amenities.
“We’re really blessed in Houston with a number of factors that make us really a strong market and one that’s very resilient —resilient in terms of a very low cost of living relative to the rest of the country. A very low — much lower — unemployment basis. And a number of factors make us a solid and stable market. Obviously we’re feeling the pinch of the national economy, but no where near like other cities.”
Ed: “So are you optimistic?”
“I’m always optimistic!”
What can be expected in industrial real estate was forecast by Welcome Wilson, Jr., of GSL Welcome Group.
“We luckily have been somewhat insulated to the events of the last 12 months that have affected the national economy. We will be affected here, but I think, as Ed said, we’re in a lot better shape. A lot of us survived the 80’s, we’re a lot better-equipped to deal with this, and as a result of the lessons learned from the 80’s, I think Houston finds itself in better shape than most cities to handle the national downturn in the economy.”
Joel Marshall of Trendmaker Development says Houston didn’t have the pricing bubble that happened on the West Coast, although there has been a significant downturn in volume.
“We have benefited from the impact of the energy industry in Houston. It’s been beneficial to us, to keep the jobs up. However, we haven’t had the regulatory environment that created the pricing bubble in those other markets. We’ve had a much more reasonable environment to work. We just kept our supply and demand in balance.”
Craig Hausman of Yancey/Hausman expects a downturn in office real estate.
“I think probably we’re going to look back and see we peaked in in terms of rental rate (and) occupancy probably second quarter of this year. And I think the first tell-tale sign of a weakening market is that we’re having a lot of sublet space — companies trying to shed some commitments on space, which is going to tend to soften the demand for space.”
Ed Mayberry, KUHF Houston Public Radio News.