Retail Occupancy Holds Steady Amid Construction Boom

Rendering of the Buffalo Heights mixed-use project underway in the Inner Loop.

HOUSTON – (Realty News Report) – Houston continues to see substantial retail development, with new shopping centers, grocery stores and restaurants rising across the market.

Strong job growth and low unemployment have helped these new spaces lease quickly. According to CBRE, the market-wide retail occupancy rate stood at 94.3 percent in the second quarter.

The tenant mix is changing. Traditional regional malls anchored by department stores such as Sears, JCPenney and Macy’s are giving way to new formats as e-commerce reshapes retail and forces closings of chains like Charming Charlie, GNC and Payless Shoes.

“We’re seeing a lot more entertainment users coming into the market,” said Lacee Jacobs, a retail specialist with CBRE. Much of the new retail and mixed-use development is concentrated inside Houston’s Inner Loop, with projects such as M-K-T in the Heights, Regents Square and Buffalo Heights drawing attention.

Weitzman, a Texas-based retail real estate firm, identified a number of notable projects completed or under development in 2019:

H-E-B in the Heights, 2300 N Shepherd Drive: A 92,000-square-foot, two-story H-E-B opened in the first half of 2019 in the urban Heights neighborhood.
H-E-B MacGregor Market: A 90,000-square-foot store planned to open in late 2019 at Highway 288 and North MacGregor Way in the Third Ward. This location will replace the H-E-B formerly at Old Spanish Trail and Scott Street.
H-E-B Buffalo Heights, Washington Ave and S Heights Blvd.: A 96,000-square-foot urban store expected in the second half of 2019 as part of the Buffalo Heights mixed-use development, anchoring street-level retail in the project’s first multifamily phase.
University Commons Phase II, US 59 and University Blvd, Sugar Land: A 109,000-square-foot expansion that includes a 30,000-square-foot Sprouts Farmers Market, which opened in early 2019.
Lake Woodlands Crossing, Lake Woodlands Dr & Grogan’s Mill Rd, The Woodlands: Approximately 63,000 square feet of retail within The Woodlands Town Center, including a 25,000-square-foot Total Wine.
Creekside Park West, Creekside Forest Dr & W Harmony Place, The Woodlands: The first phase features the Houston-area debut of Austin-based Moviehouse & Eatery, with completion targeted for late 2019.
Brazos Town Center, IH-69 (US-59) and FM 762, Rosenberg: One of the market’s largest non-mall centers added a junior anchor space for Old Navy (approximately 12,500 square feet).
District West, Westpark Tollway near Peek Rd, Katy: The first phase includes Star Cinema Grill. When fully built, District West could reach as much as 500,000 square feet of mixed-use space—retail, office, healthcare and more (phase includes roughly 55,000 square feet).
CityPlace at Springwoods Village, IH-45 North & Grand Pkwy, Spring: The initial retail phase began construction with tenants such as Star Cinema Grill and a 38,000-square-foot 24 Hour Fitness, along with small-shop space; delivery was planned for the second half of 2019.
Cypress Marketplace, Barker Cypress Rd & US-290, Cypress: Located at the northwest corner of Barker Cypress Road and the Northwest Freeway, the center features an 88,000-square-foot At Home store that opened in June 2019 and a 148,000-square-foot Costco scheduled for the second half of 2019.
Katy Grand, Grand Pkwy & Katy Fwy, Katy: A new phase opened in the first half of 2019 with tenants like 85C Bakery, joining existing anchors such as Cinemark (new phase about 36,000 square feet).
MetroPark Square, IH-45 & SH-242, Shenandoah: An entertainment-focused mixed-use project that opened an AMC 10-screen cinema in March 2019 and planned a Dave & Buster’s for the second half of the year.
336 Marketplace, at I-45 South and S Loop 336W: Expanding to include a 45,000-square-foot Dick’s Sporting Goods scheduled to open in late 2019.
American Furniture Warehouse, IH-45 near NASA Bypass, Webster: The national furniture chain planned its first local location for late 2019. The facility was expected to total roughly 355,000 square feet, with a retail showroom around 100,000 square feet.
Park Air 59, US-59 near Will Clayton Pkwy, Humble: A mixed-use development including an 80,000-square-foot Floor & Décor slated to open in the second half of 2019.
Riverstone Place Shopping Center, University Boulevard and LJ Parkway, Sugar Land: A new 28,000-square-foot neighborhood center serving the Riverstone area.

Planned or Later-Phase Projects for 2020 and Beyond

H-E-B Meyerland Plaza, W Loop 610 & Beechnut Dr, Houston: A two-story Inner Loop store planned for the historic Meyerland Plaza—originally opened in the 1950s. Construction was set to begin in 2019 to replace an H-E-B at Chimney Rock and South Braeswood that was damaged in Hurricane Harvey.
M-K-T, North Shepherd St at 6th & 7th Sts., Houston: An urban redevelopment in the Heights converting older warehouse buildings into roughly 200,000 square feet of mixed-use space, including substantial retail and restaurant components plus office space. The project targeted completion in 2020.

HOUSTON – (Realty News Report) – Houston continues to see substantial retail development, with new shopping centers, grocery stores and restaurants rising across the market.

Strong job growth and low unemployment have helped these new spaces lease quickly. According to CBRE, the market-wide retail occupancy rate stood at 94.3 percent in the second quarter.

The tenant mix is changing. Traditional regional malls anchored by department stores such as Sears, JCPenney and Macy’s are giving way to new formats as e-commerce reshapes retail and forces closings of chains like Charming Charlie, GNC and Payless Shoes.

Weitzman, a Texas-based retail real estate firm, identified a number of notable projects completed or under development in 2019:

H-E-B in the Heights, 2300 N Shepherd Drive: A 92,000-square-foot, two-story H-E-B opened in the first half of 2019 in the urban Heights neighborhood.

H-E-B MacGregor Market: A 90,000-square-foot store planned to open in late 2019 at Highway 288 and North MacGregor Way in the Third Ward. This location will replace the H-E-B formerly at Old Spanish Trail and Scott Street.

H-E-B Buffalo Heights, Washington Ave and S Heights Blvd.: A 96,000-square-foot urban store expected in the second half of 2019 as part of the Buffalo Heights mixed-use development, anchoring street-level retail in the project’s first multifamily phase.

University Commons Phase II, US 59 and University Blvd, Sugar Land: A 109,000-square-foot expansion that includes a 30,000-square-foot Sprouts Farmers Market, which opened in early 2019.

Lake Woodlands Crossing, Lake Woodlands Dr & Grogan’s Mill Rd, The Woodlands: Approximately 63,000 square feet of retail within The Woodlands Town Center, including a 25,000-square-foot Total Wine.

Creekside Park West, Creekside Forest Dr & W Harmony Place, The Woodlands: The first phase features the Houston-area debut of Austin-based Moviehouse & Eatery, with completion targeted for late 2019.

Brazos Town Center, IH-69 (US-59) and FM 762, Rosenberg: One of the market’s largest non-mall centers added a junior anchor space for Old Navy (approximately 12,500 square feet).

District West, Westpark Tollway near Peek Rd, Katy: The first phase includes Star Cinema Grill. When fully built, District West could reach as much as 500,000 square feet of mixed-use space—retail, office, healthcare and more (phase includes roughly 55,000 square feet).

CityPlace at Springwoods Village, IH-45 North & Grand Pkwy, Spring: The initial retail phase began construction with tenants such as Star Cinema Grill and a 38,000-square-foot 24 Hour Fitness, along with small-shop space; delivery was planned for the second half of 2019.

Cypress Marketplace, Barker Cypress Rd & US-290, Cypress: Located at the northwest corner of Barker Cypress Road and the Northwest Freeway, the center features an 88,000-square-foot At Home store that opened in June 2019 and a 148,000-square-foot Costco scheduled for the second half of 2019.

Katy Grand, Grand Pkwy & Katy Fwy, Katy: A new phase opened in the first half of 2019 with tenants like 85C Bakery, joining existing anchors such as Cinemark (new phase about 36,000 square feet).

MetroPark Square, IH-45 & SH-242, Shenandoah: An entertainment-focused mixed-use project that opened an AMC 10-screen cinema in March 2019 and planned a Dave & Buster’s for the second half of the year.

336 Marketplace, at I-45 South and S Loop 336W: Expanding to include a 45,000-square-foot Dick’s Sporting Goods scheduled to open in late 2019.

American Furniture Warehouse, IH-45 near NASA Bypass, Webster: The national furniture chain planned its first local location for late 2019. The facility was expected to total roughly 355,000 square feet, with a retail showroom around 100,000 square feet.

Park Air 59, US-59 near Will Clayton Pkwy, Humble: A mixed-use development including an 80,000-square-foot Floor & Décor slated to open in the second half of 2019.

Riverstone Place Shopping Center, University Boulevard and LJ Parkway, Sugar Land: A new 28,000-square-foot neighborhood center serving the Riverstone area.

Planned or Later-Phase Projects for 2020 and Beyond

H-E-B Meyerland Plaza, W Loop 610 & Beechnut Dr, Houston: A two-story Inner Loop store planned for the historic Meyerland Plaza—originally opened in the 1950s. Construction was set to begin in 2019 to replace an H-E-B at Chimney Rock and South Braeswood that was damaged in Hurricane Harvey.

M-K-T, North Shepherd St at 6th & 7th Sts., Houston: An urban redevelopment in the Heights converting older warehouse buildings into roughly 200,000 square feet of mixed-use space, including substantial retail and restaurant components plus office space. The project targeted completion in 2020.

July 23, 2019 Realty News Report Copyright 2019