Howard Hughes Buys Houston-Area Building
JLL Capital Markets arranged the sale of the vacant property.
Howard Hughes Holdings Inc. has acquired 10101 Woodloch Forest Drive, a 202,601-square-foot, eight-story Class A office building in The Woodlands, Texas, for $16.3 million.
The building, which the buyer intends to rename as 7 Waterway, sits on a 1.6-acre site, with 700 parking spaces in an adjacent garage owned by the company under a perpetual parking agreement.
The 2009 building is unoccupied, which Howard Hughes stated gives the company “the immediate ability to offer in-demand Class A office space in the region’s highest-performing office submarket.”
Howard Hughes did not disclose the seller, but in a separate announcement on Wednesday, JLL Capital Markets stated that it had represented the seller, Net Lease Office Properties.
The JLL Capital Markets Investment Sales and Advisory team representing the seller was led by Managing Director Kevin McConn and Senior Managing Director Jeff Hollinden.
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Investor demand for quality office product in The Woodlands remains very high, according to a company statement.
Information provided by CommercialEdge suggests that the building had at some time recently been occupied by health-care giant McKesson.
Texas-sized deals
A flight to quality is highly evident in metro Houston’s office market, where the overall vacancy is 26.3 percent, versus 11.7 in Tier 1 assets, according to a first-quarter report from JLL.
Several large deals marked the quarter, including LyondellBasell’s 318,000-square-foot move-in at Williams Tower and Westlake Corp.’s 158,000 square feet at 5444 Westheimer, both in the Galleria submarket.
The CBD saw two renewals: Motiva’s 246,316 square feet at One Allen Center and Aramco’s 166,930 square feet at Two Allen Center.
Despite this level of activity, Houston’s overall office market saw a second straight quarter of net negative absorption, losing about 233,000 square feet, JLL reported.
Last summer, Howard Hughes Holdings acquired Waterway Plaza II, a 142,400-square-foot office building in The Woodlands Town Center, for $19.2 million. The six-story building includes a 1,316-space parking garage.
The property was then just 55 percent occupied, but in that case too Howard Hughes characterized that as adding welcome inventory to its office portfolio in The Woodlands Town Center, which was at the time 96 percent leased.
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