HOUSTON--(BUSINESS WIRE)--Houston's real estate market is demonstrating remarkable strength in the Inner Loop as the city becomes more dense, according to Houston-based Deal Sikes & Associates, one of the region's leading real estate valuation and counseling firms.
Developers are searching for properties that can be redeveloped or adapted for reuse as multifamily, mixed-use or retail centers.
“Property values near the center of the city are rising,” said Matthew Deal, principal of Deal Sikes & Associates. “Sites that are suitable for new development are sought after and this increasing demand is putting upward momentum behind the prices of these properties.”
Deal noted that a publicly traded national home builder recently acquired property near the Cavalcade Station on the METRORail Red Line where it will build a gated community with 39 town homes.
Property that has been used for warehouses or light Industry can be adapted for development as multifamily or town home projects, Deal said. Vacant parcels of land, especially if the site requires no environmental remediation, attract intense attention from developers, he said.
“Prices for redevelopment sites have risen as much as 10 percent or more, in some cases, in a very short period,” Deal said. “The general upward trend in valuations will likely continue for some time. In particular, the areas east of downtown Houston appear to be gaining with strong velocity, a major trend to watch in the future.”
Multifamily occupancy rates increased last year and the apartment market appears to be ready for a new wave of construction, Deal said.
“Suburban growth remains dominant in the Houston metropolitan area,” said Mark Sikes, principal of Deal Sikes & Associates. “But there is considerable growth in the Inner Loop. The massive Millennial generation is coming of age in the residential market and the unique character of the Inner Loop neighborhoods is appealing to them.”
“The Houston economy is improving and job growth is recovering rapidly,” Sikes said. “The next 12 months will be good for all sectors of Houston real estate.”
Houston-based Deal Sikes & Associates provides valuation and counseling services for real estate companies, governmental agencies, law firms, energy companies and other corporations.