Mark Van Ness, president of Sperry Van Ness, tells GlobeSt.com that Houston actually has the lowest price per sf in the nation, but the cap rate dragged down the city to the No. 3 spot. Van Ness says it is typical right now for investors to find return rates in other cities up to 20% lower than Houston with triple the price per sf. The study was based on the media transaction yields of multi-million dollar sales on an all-cash basis and the price per sf paid for buildings to date this year.
Van Ness says his advice is buyers should consider acquiring industrial product in Houston. Investors have been cautious of buying in Houston, he says, because of losses suffered in 1980s downtown. But with current high yields and exceptionally low price per foot, Van Ness expects Houston's investor outlook to change dramatically, a phenomenon many brokers say is already happening.
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