Houston Apartment Market Outlook: Q&A with Martin Fein

HOUSTON – (Realty News Report) – Houston’s multifamily sector has experienced several shifts over the past 18 months. From an oversupply of units in the first half of last year, to a temporary scarcity following Hurricane Harvey, and now to a more balanced market, conditions appear to be stabilizing. To better understand where the market stands, Realty News Report spoke with Martin Fein, CEO of Martin Fein Interests, Ltd. Fein has developed thousands of multifamily units over the past 30 years across Houston and other U.S. markets and is preparing multiple projects to deliver to residents over the coming years.

Realty News Report: What’s the status of Houston’s multifamily market today?

Martin Fein: In Houston we delivered roughly 30,000 units in 2016 and 2017, and about 10,000 more units will come online before the construction pipeline clears this year. Overall, the market is in recovery, though some submarkets remain uneven. Areas like Katy and North Houston absorbed their new supply well. By contrast, the Galleria and downtown areas are softer. The central business district has seen a large influx of units, and it will take time for those to be fully absorbed.

Realty News Report: Many units were filled immediately after Hurricane Harvey as displaced residents sought shelter. We heard that you personally came into the office after the storm and helped place people. Can you tell us about that?

Martin Fein: That’s correct. For about the first two weeks after Harvey, I spent much of my time on the phone helping people find apartments, not only in our properties but across the city. Many residents could not return home and urgently needed shelter. Our available units filled quickly and we reached full occupancy, and we also coordinated placements with other complexes to assist as many families as possible.

Realty News Report: How is Houston’s overall recovery progressing?

Martin Fein: Houston’s economy has come a long way since Harvey. The region added roughly 100,000 jobs in the last 12 months, and economic sentiment has improved compared with a few years ago. Home sales are strong, job creation is robust, and the energy sector is recovering. The Port of Houston is performing well, which supports broader trade and local employment. In many ways Houston’s recovery parallels national trends, but local drivers like the medical center and port are contributing to resilience.

Realty News Report: Your firm recently acquired 3.4 acres on Post Oak Park Drive for a 300-unit mid-rise project near Loop 610 at River Hollow Lane. What made that site attractive?

Martin Fein: The location is exceptional. It sits within a residential neighborhood yet borders the retail, hotels and office amenities of the Galleria area. When the tract became available we moved quickly. We broke ground on a luxury apartment community in August, with delivery expected in mid‑2020.

Realty News Report: Houston has a number of older buildings. Do you see opportunities to repurpose them for multifamily or retail use?

Martin Fein: Several conversions have already taken place, though Houston doesn’t have as many older vacant buildings as some older eastern cities. We’ve seen office properties turned into apartments in locations such as Greenway Plaza and Meyerland. Future conversions will depend on market demand and the specific economics of each site.

Realty News Report: Your firm has built several multifamily communities inside the Inner Loop. Is Houston becoming denser and more vertical?

Martin Fein: Absolutely. Multifamily development inside the Loop continues to densify. One of our early Inner Loop projects in the 1990s was a three‑story walk‑up. Since then the market has matured: what used to be mid‑rise development is increasingly giving way to high‑rise projects as demand strengthens and developable sites become scarcer. Rising land costs push developers to build upward, so I expect continued vertical growth and greater density within the Inner Loop.

Realty News Report: Houston’s population is projected to grow further. What are your predictions for the city over the next 10 to 20 years?

Martin Fein: Houston is on track to surpass Chicago and become the nation’s third largest city in the near future. Our diversity and international connections—more than 90 consulates—make Houston a leading example of the country’s future demographics. Beyond energy, the city’s economy is supported by institutions like the Texas Medical Center and the Port of Houston. The future looks bright, provided the region addresses key infrastructure challenges such as transportation, water and sewer systems to support ongoing growth.

Dec. 4, 2018 Realty News Report Copyright 2018