East Belt Business Park is a four-building class-A industrial project that totals 350,000 square feet.

HOUSTON—Industrial investors are continuing to target Houston and East Belt Business Park is the latest in the string of institutional buys to hit the sale column. TA Realty purchased the asset sold by a fund advised by Morgan Stanley Real Estate Investing.

The four-building class-A industrial development totals 350,000 square feet in Houston's Southeast submarket. This highly sought-after submarket is the second-largest industrial submarket in Houston.

Developed in phases in 2004 and 2008, East Belt Business Park comprises two rear-load and two cross-dock buildings that feature 20- to 24-foot clear heights, 114 dock-high doors, 14 drive-up ramps, 510 parking spaces and truck courts ranging from 120 to 180 feet. Additionally, the property's flexibility caters to tenants of all sizes and the park has retained more than 90% occupancy since delivery.

The JLL industrial capital markets team that represented the seller was led by managing director Trent Agnew, senior managing director Rusty Tamlyn, director Charlie Strauss and analyst Tom Weber.

"Houston continues to be among the top markets across the country that industrial investors are focused on, though they are disciplined in looking for opportunities that will hopefully outperform the market," Strauss tells GlobeSt.com.

The project is located on 23.7 acres at 1455-1485 East Sam Houston Pkwy. South. With frontage along Beltway 8/Sam Houston Tollway, East Belt Business Park provides regional connectivity to the entire Houston MSA and is three miles from the Port of Houston, a 25-mile long waterway that services 8,200 vessels and 215,000 barges each year.

"East Belt Business Park is a unique property that caters to tenants of varying sizes in a market focused on big-box development," Agnew said. "This was a highly competitive process that proved investor demand for high-quality product with upside potential. This particular asset/project saw a tremendous amount of investor interest because it is differentiated in the market and has a great operating history of consistent occupancy. Rents have generally grown much faster in the smaller tenant spaces than big box within the Houston market, as there is not as much supply that caters to these 10,000 to 60,000-square-foot tenants that are the bread and butter for a project like East Belt."

Leasing activity continued its momentum from third quarter with 5.5 million square feet of transactions signed in fourth quarter for a total of 20.9 million square feet leased (just shy of the five-year average), according to JLL's fourth quarter 2019 industrial insight report.

Net absorption rebounded in the last quarter to 2.4 million square feet for 8.5 million square feet total on the year. This was much improved over weaker occupancy gains in the first and third quarters. The supply pipeline remained very robust, closing out 2019 with a record 15.9 million square feet under construction and 17.8 million square feet delivered, says JLL.