The key word for Houston, now as in yesteryear, is energy. Oil- and gas-related companies for offshore and onshore operations once again are pumping up the city's economy. Unlike 30 years ago, the story's different because the city has made a concerted effort to diversify its economic base, learning its lesson from relying on one industry when it was 80% driven by the oil and gas industry.

William C. Forrest, senior adviser for Sperry Van Ness in Houston, says today's economy is about 60% driven by oil and gas companies, climbing slightly in the past year. "It's perceived as more than that," he says, stressing it's not returned to the danger level of three decades ago nor is it likely to do so. He says the economic muscle from the Port of Houston and the Texas Medical Center are guarantees that history won't repeat itself.

Forrest says retail sales are pushing $250 per sf to $300 per sf versus $150 per sf of a year or two ago. Office sales are bringing in $175 per sf to $200 per sf whereas the average price had been roughly $100 per sf. "Those two property types are getting close to their max," he says. As a result, he believes more owners might decide it's better to hold than fold in 2008 due to cap rate pressure.

Tamlyn, like Forrest and others, had deals carry over into the New Year. He says it's not a reflection of local market conditions or owners already pulling back, but rather ongoing fallout from the correction of the capital markets. He says it will be midyear before the ship rights.

"We're still closing deals and we're still financing deals. It's just with different players," Tamlyn says. "But, we're also realistic. It's different this time because sellers won't be able to refinance and pull out their equity and still hold. They'll hold, but not refinance."