“Flight to quality,” commute times to Westside neighborhoods and The District’s livability initiatives help drive growth
When 11 million yards of concrete are being poured in your town each year – and not on roads – requiring plus mixing trucks every workday, you’ve got yourself a building boom.
This year, a whole lot of those trucks emptied their loads in The Energy Corridor, where Class A office construction is outpacing every other business district in Houston. In fact, the 5.8 million square feet of offices now under construction in The Energy Corridor is nearly three times that of downtown and The Woodlands, according to JLL Research findings published in a recent Houston Business Journal.
It’s a trend likely to continue, according to the development and commercial real estate roundtable participants at Bisnow’s The Future of The Energy Corridor conference, held October 31 at the Omni Houston Hotel at Westside.
Sure, some of the speakers told the 700 conference attendees, the growth may come off a bit from the current, torrid boom.
But with more amenity-filled Class A office buildings on the way – coupled with its 30-minute drive time for 44 percent of Houston’s engineers and architects – The Energy Corridor will remain a strong destination for companies the world over.
Construction has doubled since Bisnow’s first Energy Corridor-focused event in January 2013. Yet, occupancy is above 90 percent – one of the strongest in Houston – and new construction is already 60 percent pre-leased, said Bob Cromwell, Moody Rambin managing director.
Cromwell credits a “flight to quality” for keeping The Energy Corridor a sought-after corporate destination. And the demand for quality buildings is driving Class B properties to upgrade, said Cromwell.
In fact, said Charlie Neuhaus, principal for multinational commercial real estate firm Avison Young, The Energy Corridor is in consideration “100 percent” of the time for companies outside of Houston looking for new space.
The Energy Corridor is not without its challenges, Bisnow conference attendees agreed. The event kicked off as crude oil prices dipped below $80 a barrel. But despite falling oil prices, roundtable participants said The Energy Corridor would continue appealing to companies even if growth slowed down from its current sizzling pace.
Keeping transportation moving will be The Energy Corridor’s – and Houston’s – biggest challenge, said many of the Bisnow participants.
It now takes 37 minutes to drive in rush hour from Pin Oak in the west to downtown, 17 minutes more than in 2012, according to Neuhaus. While that increases the appeal of commuting from popular Westside neighborhoods to The Energy Corridor instead of downtown or Uptown, Houston’s overall traffic situation is a concern for people contemplating a move here, he explained.
David Hightower, president of The Energy Corridor District and EVP of Wolff Companies, kicked off the conference by sharing The District’s 20-year plans to encourage alternative transportation use, while working to improve livability.
Programs like The District’s growing Enterprise CarShare effort – which provides vehicles at work for commuters getting to the office by vanpools and carpools, METRO buses, bicycles or walking – can help, said Hightower. The District is also evaluating a transit circulator that would connect METRO’s Addicks Park and Ride with corporate campuses.
To improve livability, both Hightower and panelist Clark Martinson, general manager of The Energy Corridor District, explained The District’s work to make the area more walkable, bicycle-friendly and interconnected, using a master-planning approach that involves major stakeholders throughout the area. Such efforts can appeal to Millennial employee recruits, said Hightower, and help keep The Energy Corridor competitive with other business centers.