Provident Lands $102M for Houston Industrial Project
The development will total 1.3 million square feet.
Provident Realty Advisors has obtained $102 million for the development of a three-building Class A industrial project in Houston’s Baytown submarket. The development, the second phase of Port 99, will total 1.3 million square feet on 92 acres near the Port of Houston.
PGIM’s Real Estate Investment Group provided a $30.4 million mezzanine construction loan, which came alongside senior financing from Bank OZK and additional joint venture equity from Junction Commercial Real Estate. Northmarq arranged the capitalization.
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The three distribution and warehouse buildings will feature cross-dock and front-load configurations, with additional trailer parking to support regional and national distribution needs.
The project, taking shape at Farm to Market Road 2354, is designed to address ongoing demand for industrial facilities to serve the port and growth along the Grand Parkway, which was recently expanded and completed.
Warren Hitchcock, managing director at Northmarq, led the Houston Debt + Equity team that arranged the capitalization.
Houston industrial shows stability
In a prepared statement, Daniel Kattan, executive director at PGIM, commented that Houston remains one of the country’s most attractive industrial markets, based on its strategic location, logistics infrastructure and long-term projected economic growth.
Overall industrial vacancy in the region decreased to 7.4 percent in the second quarter, according to a recent report from Partners Real Estate, though this was an increase of 16 basis points year-over-year.
Net absorption was 7.7 million square feet in the second quarter, which was a 75 percent jump from the previous quarter. Meanwhile, leasing velocity declined by 5.4 percent from the first quarter, but rose 4.6 percent annually.
Provident has been active this year, buying a Dallas office tower for its new headquarters in January, acquiring a 13-building industrial portfolio in April and breaking ground last month on its first project in the Northeast, a 257,040-square-foot industrial building in Limerick, Pa., near Philadelphia.
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