Tenants back in driver seat NOW!

"The concern isn't that Houston, Texas specifically, has reached a critical point, but there is an undercurrent that it might due to the widespread and fast-paced momentum. In fact, industry professionals agree that vacancy and absorption--in some submarkets--validate the need to build. There are fears of overbuilding because there's so much activity.



Liquidity and overbuilding were in the spotlight. A lot of these buildings are being purchased on the come. Those buildings have no choice but to push rents. The question is will rents catch up to construction costs. Everyone who is buying building and everyone who is building a building are thinking it will happen. But, developers are going to have to take a lower return until the rents are there.


The consensus is that the pendulum is swinging back to Tenant's market after several years with landlords in control now that we are in the real rescission.


The reality is rents are rising, buildings are filling and the buy-in is cheaper in Houston than either coast. As coastal investors buy into the region, the market's veterans are banking on Houston historical appetite for new and expensive. And yes, there is the age-old concern about what will happen to existing class B and class A buildings." For more information see: www.houstonrealtyadvisors.com or www.houstonrealtyadvisors.net