2008 Construction Outlook For Texas

Report:

Cranes also tower over downtown Austin, where currently more than one dozen hotels, condominiums and mixed-use high rises are under construction along Lady Bird Lake. The idea of work downtown/live downtown is another way that Austin is combating traffic congestion on its freeways. On the other hand, Austin’s neighboring counties, Hays and Williamson, are in the top 100 fastest-growing counties in the nation for housing units and retail/light commercial.

Houston

Although new highway projects in the Houston area will remain down, building in the surrounding suburban counties will continue strong in 2008. Fort Bend and Brazoria counties on Houston’s southwest side, with their growing communities of Katy, Sugar Land and Pearland will continue as a hotbed of residential and light commercial construction.

What Free Parking?

From FWWeekly.com:

Taft defended the parking program with the example of The Tower, the multi-million-dollar high-rise condo that was redeveloped in the old tornado-damaged Bank One building. That project wouldn’t have happened without public money, he said.

The TIF helped pay for asbestos removal during the renovation and now pays TLC Green, the building’s owner, $832,904 a year to lease about 400 parking spaces. The lease is in effect for 10 more years, guaranteeing TLC Green $9.8 million. Few people probably know that, however — there are no signs at The Tower advertising the free parking, though web sites run by Downtown Fort Worth Inc. do mention it.

The Tower “had some real problems and sat for a long time after the tornado” in 2000, Taft said. “There were many who thought it would be torn down. And the conversion of an office to condominiums was a very risky venture. But the investment we made through TIF money, in both asbestos removal and parking, made the development happen.

“Once it happened and succeeded, the downtown housing market really took off,” Taft said. “None of the new housing downtown would have happened as it did had The Tower not succeeded. The government agencies have seen their property tax revenue go up. So I would say it was a very good investment.”

First Baptist Dallas leader Robert Jeffress calls for new worship center

Sam Hodges writes:

Both First Presbyterian and First United Methodist of Dallas are expected to announce more modest expansion projects this year. The latter has a relatively new, 75-member class of young professionals, many of them living in recently built or restored condominiums and apartments nearby.

"The downtown churches have always been regional churches. We pull from all over Dallas County. The news flash is we've become neighborhood churches again," said John Fiedler, senior pastor at First United Methodist.

Mixed-use project planned in Colleyville

Steve Brown writes:

Realty Capital Corp. said Monday that it will start work next summer on the two-building, $10 million project.

The development is planned as a new "front door" to the Village at Colleyville complex on State Highway 26.

Realty Capital said it has acquired several properties fronting along the highway, which will be cleared for the planned construction.

"After years of negotiations with the sellers, we were thrilled that we finally had the opportunity to purchase these three properties," Jimmy Archie, chief operating officer at Realty Capital, said in a statement. "This project will bring The Village at Colleyville out to Highway 26 and it will serve as a landmark for the entire development."

The developer plans to build two Spanish-Mediterranean style buildings on the property. A three-story building will contain retail, restaurant and office space on the ground floor with 30 condominiums above that. The condos will sell for about $250,000.

Austintatious: Change is storming Texas' low-key capital of cool

From Trading Markets.com:

A W Hotel is under construction as part of the $260 million Block 21 development. New high-rise condos and cranes dot the skyline. In the city's northwest, the outdoor mall The Domain _ which feels like Southlake Town Center, or NorthPark with the lid off _ opened in March sporting Austin's first full-line Neiman Marcus (it already had a Last Call), as well as Louis Vuitton and Ralph Lauren stores. A second phase of The Domain is set to open in 2009.

Longtime Austinites and newcomers alike debate among themselves whether there are enough people in the metro area of 1.5 million to support such a market over the long haul. "Fifteen years ago, I would have said that Starbucks would not have been successful, that Austin isn't going to pay $5 for a cup of coffee. I would have told you that ice hockey would never play in Austin," says Jim Nolen, a senior lecturer in the University of Texas at Austin's finance department. "But it is successful, and that tells you how many people have migrated to Austin."

"There are so many transplants coming in with all the growth," says Johanna Flink, general manager of Qua, a 25-and-over bottle-service lounge _ with a controversial shark tank in the middle of the floor _ that opened in October within a Cristal spritz of Pangaea. "It's great to meet people from New York and London. I just met two Australians who moved here. I'm like, `How did you hear about Austin?'"

Boasting such annual events as the South by Southwest music/film/interactive festival and the Austin City Limits music festival, and home to the state's most vibrant movie industry, the self-proclaimed "live music capital of the world" has long been on the hipster radar. But now that Austin is showing up on "best cities" lists _ ranked in the Top 10 in Money, Travel & Leisure, Kiplinger, Hispanic Magazine and Men's Journal in recent years _ it's attracting interest from a broader spectrum of the population, says Beth Krauss of the Austin Convention and Visitors Bureau.

Cedar Spring Strip Fights For Life

Here's the article:

As more old homes and apartment buildings were razed and more new high-end residential and business buildings started going up in Oak Lawn in 2007, some people applauded the new developments while others bemoaned the loss of the area�s unique personality and historic charm.

Many longtime residents of the area also expressed dismay that they were being run out of Oak Lawn as most of the older, more affordable housing was being replaced with expensive high-rise condos and townhomes, and that the �gayborhood� was being taken over by wealthy heterosexuals.

In January, Crosland Investments, a North Dallas development company, announced plans to construct a multi-floor apartment building with ground floor retail space on the site of the former Tom Thumb grocery store on Cedar Springs Road.

The following month, some longtime business owners in the area announced the reformation of the Cedar Springs Merchants Association. Association members said they wanted to work together to fight off the recent downturn that they attributed, in part, to ongoing street construction that made it more difficult for shoppers and club-goers to get to the Cedar Springs strip.

New projects will change face of Fort Worth in 2008

Betty Dillard writes:

The real estate success story that Fort Worth experienced during 2006 and 2007 is poised to continue its record-breaking pace well into 2008, say industry experts, thanks to healthy job growth and a strong economic cycle.

As the 18th-largest and fastest-growing city in America, Fort Worth continues to expand in virtually every market sector. Major developments throughout the city and across Tarrant County are drawing new patrons — both Texas-based and out-of-area investors — to the office, industrial, retail, hospitality and residential arenas, signaling a robust growth stage for the entire area.

High-profile projects — such as downtown’s 280,000-square-foot, Class A Carnegie Building and the 606-room Omni Fort Worth Hotel adjacent to the recently renovated Convention Center, the 320,000-square-foot River Plaza mixed-use development nestled alongside the Trinity River in the University district and the 500-acre Alliance Town Center north of downtown — have bolstered Fort Worth as a world-class city.

With Housing Down, Some Buying Spots The Boom Bypassed

Report:

The tougher the real estate market gets, the more analyzing location matters.

Not since the dot-com collapse of 2001 have sales of existing homes been so depressed. Residential property values have declined significantly in 46 states, with only Vermont and North Dakota recording marginal increases, according to the National Association of Realtors. Home sales in Seattle, Tucson and Baltimore, for instance,were down more than 40% from a year ago in the third quarter, a recent study by Re/Max International found.

So where can a prudent investor look for value and return when last year's preferred locations have plateaued or depreciated? For some the answer is found in undervalued urban areas bypassed by recent property run-ups.

Take Buffalo, N.Y., in decline for more than half a century. The Rust Belt city is now undergoing renewal and attracting investors.

"It's still possible to get in on the ground floor here," said Anthony Kissling, director of a more than century-old investment firm in New York City, Kissling Interests. He owns 20 buildings in Buffalo with 800 apartments, all of which are rented.

"I'm still looking around," Kissling said. "Property in Buffalo is ripe for the picking."

And in 2008 ... Arlington

From the Star Telegram:

Arlington will always have a vast, sprawling residential component, but it also needs to encourage other, more dense residential lifestyles. Some of this is occurring on a limited scale. The Glorypark project, for instance, contains mixed-used condominiums and apartments as part of its basic concept. Another mixed-use project is planned in the downtown area

UTA plans a "College Town" complex with offices below and apartment lofts above. Architect Mojy Haddad is building a brownstone-style condo development in north Arlington.

But 2008 would be an ideal time for city leadership to accelerate this process and to lean on the most radical departure from the city's historical residential development theme: the Lamar-Collins Overlay strategy.

The overlay encourages redevelopment of the 267-acre area -- currently dominated by aging apartments -- by allowing high-rise, mixed-use developments. That's offices, stores and restaurants at the lower level and 15,000 to 20,000 condos and apartments above.

New interchanges on Interstate 30 either under construction or about to be built will dramatically increase access to this area. Emphasis on planning and marketing the area in 2008 will provide major dividends for Arlington's future.

Dallas-Fort Worth sellers trim home prices in hopes of landing a winter sale

From DallasNews.com:

Along with colored lights and Christmas trees, a sure sign of the holidays are the "New Price" signs decorating thousands of neighborhood lawns.

After putting houses on the market in the summer and getting no takers, many sellers are trimming costs in hopes of landing a winter sale.

This year, there's a new dynamic to this seasonal occurrence – a nationwide housing slump that's keeping homes on the market longer.

Real estate agents say that sellers who haven't gotten a nibble after months on the market need to rethink.

"You don't need to wait around for six months to decide if your price is right," said Dallas agent Lydia Player. "If we don't get an offer in the first few weeks, we need a price reduction."

Ms. Player recently put under contract a North Dallas custom home that had been for sale for almost a year.

"It was priced at $1.75 million, which we thought was OK," she said. "We had to reduce it several times.

"When we reduced it to $1.395 million, we got three offers immediately."

That just confirms the real estate adage that everything will sell for a price. But getting there can be painful for sellers.

Victory, Glorypark play different positions in Dallas-Fort Worth

Steve Brown writes:

Victory Park has given a big boost to Dallas' center city with its luxury residences, W Hotel and exclusive retail stores.

Glorypark in Arlington may do even more for the suburbs.

Victory Park and Glorypark are near sports venues, and Dallas investor Tom Hicks is involved in both. At first glance, they even look alike in drawings.

The Glorypark complex south of Interstate 30 is planned as one of the country's most ambitious sports-anchored developments. The combination of shopping and entertainment, hotels, housing and office space is expected to cost more than $1 billion to build.

But Glorypark's developers – Hicks Holdings and Ohio-based Steiner + Associates – want their 70-acre project to have an even wider appeal than Victory Park.

Mr. Hicks, who's a major partner in Victory Park, explained one big difference.

"The personality of the developments will be that Glorypark will be more retail, and Victory will be more condos and residential," he said. "That reflects the downtown environment vs. suburban."

Bubble Bust

From TMQ:

After the tech-stocks bubble burst in 2000 and dragged down Wall Street, everyone claimed it was obvious all along that this would happen; though, mysteriously, most who claimed they knew all along nevertheless failed to sell before the market collapse. After the housing bubble burst in 2006, everyone claimed it was obvious all along that this would happen; though, mysteriously, most who claimed to have known all along failed to sell their real estate when the market was high or even merely to re-fi to a fixed-rate mortgage. With the benefit of hindsight, investors, economists and pundits always say bubbles were "obvious." Though mysteriously, they fail to notice at the time!

So what bubble is inflating right now, to be deemed an "obvious" bubble after many shirts are lost? Gold has been up for seven straight years, rose at 31 percent in 2007 and already has risen several percentage points in 2008. The metal is now selling for $863, versus about $600 in 2004, and the price rise appears unrelated to any increase in the underlying economic utility of the commodity. Gold has little functionality beyond jewelry and dental fillings -- almost all those who buy gold plan to hold their purchase and sell at a higher price, rather than use the gold to make something. That is, they are counting on market psychology to make their purchase more desirable, rather than adding value to it themselves. Just a word of advice: THIS IS THE CLASSIC PATTERN OF A BUBBLE! Tulip bulbs, Web start-up stock, nutria, Florida condos: If the price is rising fast and buyers are jumping in solely with the goal of flipping, a bubble is in progress. Last week, gold futures rose to their highest level since January 1980, which is when the last gold bubble burst. Don't say you weren't warned! But after the gold bubble bursts, do feel free to say this was obvious all along.

Dallas can support new “Town Centers”

Michael Davis writes:

With all of the announcements of "Town Centers" and mixed-use centers in certain parts of Dallas, many people are wondering can Dallas support all of these developments.

I believe that Dallas can support these developments, and a lot of well-heeled players are rushing to be near the front of the line. With the density that Dallas will need as its population grows, we likely will have enough people to fill these places.

I think that 'new to Dallas' residents will fill these spaces along with upwardly mobile college grads that decide that they want to be in the city and not the suburbs. I do think there will be an "arms race" to see who can best attract residents. Some will do well and some will struggle. But when you look at it, there can be a ton of coffee places, dry cleaners, etc. because the client base lives right above or in the same complex as the business.

In cities like New York and Philadelphia, it's a way of life. Every pizza store and neighborhood grocery store has people that live above in condos or apartments.

When you consider the projected growth of Dallas' population, you can see that most of these projects will be a success. The key will be to ramp up infrastructure to meet the needs of the influx of residents.