HOUSTON–GlobeSt.com talked with The Howard Hughes Corp. executive vice president of mater planned communities Paul Layne to get his perspective on the Houston development market. Layne will be one of the panelists on the Development in Houston pane at this week’s RealShare Houston conference at the Houstonian Hotel.
GlobeSt.com: What’s your overall sentiment on the Houston market?
Layne: Houston is considered one of the very top office leasing and development-ready cities in the country and as well as one of the top five markets for acquisition, and in a self-serving way the Woodlands is viewed as the tightest submarket in Houston. It’s a very exciting time to be in Houston and with oil at $104 a barrel, the prospects for the immediate future are extremely strong for continued growth.
GlobeSt.com: To what do you attribute Houston’s growth?
Layne: The majority of the growth will be tied to three sectors of Houston. The largest will be the energy business, with oil and gas. The second and third would be medical and the Port of Houston and all related entities to that. There is continued tremendous construction both from real estate projects but also energy projects – plants and distribution centers being built all along the Texas coast.
GlobeSt.com: Are there challenges to continued growth?
Layne: One of the challenges for growth will be labor in two areas. One will be construction label and two, qualified geo-science labor for the oil and gas industry. These companies, both construction companies and the energy companies are recruiting nationally and part of that is fueling the 125,000 jobs per year expected for the next several years.
GlobeSt.com: So do you think growth will continue for the next three, next five years?
Layne: I think the next two to three years look very strong with potential challenges in the interest rate variations and the increase in traffic. I don’t want to be completely Polyanna and only tell you positive things. I think those are the two risk factors that could put a damper on this unbridled growth that we are seeing.
GlobeSt.com: Tell me a little about the Woodlands and how you see that growing, developing and changing.
Layne: We’re phenomenally lucky to have five different elements of real estate that we are all aligned in – residential lot development, office building, retail, hotel and multifamily. And our position is as almost exclusive developer in the Woodlands for those five food groups. We are actively pursuing all of those; with $110 million in lot sales last year and approximately $700 million in development under construction now or in the next 30 days.
GlobeSt.com: What will you be discussing on the development panel at RealShare Houston?
Layne: Since I am representing the North Houson part I want to talk about what’s happening in North Houston in the Woodlands, talk about our projects, talk about the challenges of traffic all over town and maybe ask my co-panelists what they think can help solve that. My focus will be an update on what we are doing in the Woodlands and how that relates to the rest of the city.