Houston Chronicle - Nancy Sarnoff - October 18, 2016
Houston developers are expected to build 27,600 apartments this year, a historical high and one that's coming at a time of slumping demand for rentals, a new report shows.
The highest concentrations of apartments have been and will continue to be in the Downtown/Montrose/River Oaks area, according to a third-quarter report from Marcus & Millichap, a commercial real estate firm.
Photo: James Nielsen, Staff
The 40-story Market Square Tower will have 463 apartments. Studios will start at $1,805 a month, and a penthouse will go for $16,100 a month.
"The apartment market for the next five years is going to look like the office market did in the '80s," said Patrick Jankowski, an economist at the Greater Houston Partnership said recently.
He noted downtown specifically. Thousands of units are under way in that market, exacerbating concerns about a multifamily glut. Plus, two major sources of tenants -- Exxon Mobil and Shell -- have left or will soon leave downtown.
"People just haven't appreciated the potential for how bad things can be in the luxury market," Jankowski said.