September 6th, 2023 News Brief TLDR:

1. $142B Texas infrastructure boom promises construction gold rush. 🚧

2. $250M mixed-use project breaks ground in suburban Austin. 🏗️

3. Equity Commonwealth sits on cash mountain, eyes Austin assets. 💰

4. Chevron upsizes with 77-acre Texas R&D hub, joining the Texodus. 🛢️

INFRASTRUCTURE & PUBLIC INVESTMENT

AGC Members Ready to Execute Historic Investment

Source: ConstructionEquipmentGuide.com

Summary: The record investment of $142 billion announced by Texas Governor Greg Abbott for upgrading and expanding the state's infrastructural network paves the way for criminals developments in numerous domains – from improving the commuters' experience to catering to the state's blooming economy and population. The investments gearing majorly toward upgrading roads and bridges, and expanding the highway network concentrates extensively on enhancing safety, reducing congestion, preserving roadways, connecting rural communities with larger metros while simultaneously fostering economic growth. Various projects highlighting this infrastructure developmental spree encompass internal sub-projects associated, chiefly with the realignment of existing roads, removal of signals, creation of intelligent transportation systems among others.

Why this matters: With a substantial investment focusing on infrastructure improvements, commercial real estate professionals in Central, Texas can leverage this information to inform their clients about the surge in property values in areas benefitting from infrastructure enhancements including improved congestion, better connectivity, and enhanced safety.

REAL ESTATE INVESTMENT & DEVELOPMENT

Work Begins on $250Mln Mixed-Use Project in Suburban Austin, Texas

Source: CreNews.com

Summary: The construction of a $250M mixed-use project in Cedar Park, Texas, has commenced. This vast endeavor will occupy 95 acres and is being undertaken by multiple local real estate firms including Cordova Real Estate Ventures, Riverside Resources, and Live Oak. The project, dubbed New Hope, will be established at the intersection of U.S. Highway 183-A and New Hope Drive.

Why this matters: This significant development is a testament to the continuous expansion of the Austin real estate market into its suburbs, underscoring an opportunity for commercial real estate professionals to guide their clients towards investments and ventures in these burgeoning regions.

Equity Commonwealth: REIT Trading At Negative EV Ready To Deploy Cash At Attractive Returns

Source: SeekingAlpha.com

Summary: Equity Commonwealth is reportedly well-positioned in the current office real estate market. Many REITs face challenges due to decreased occupancies and value depredations, but Equity Commonwealth is largely insulated thanks to large-scale selling of their office assets starting in 2017. This leaves the REIT with a surplus of cash, reducing their vulnerability to changes in market conditons. The company's high-quality portfolio includes significant property in Austin, further concentrating assets in burgeoning markets rather than those suffering occupancy slumps.

Why this matters: Central Texas commercial real estate professionals can leverage the ensuing discussion with their clients about Equity Commonwealth’s strategy of concentrating high-quality assets in thriving markets like Austin and how this could impact or shape the decision-making when buying office properties in this area.

Building An 'All-Weather' REIT Portfolio

Source: SeekingAlpha.com

Summary: The article provides insights on how the future state of inflation can impact the real estate market, focusing particularly on real estate investment trusts (REITs). Several scenarios based on levels of inflation (low, moderate, high) over the short-term until 2022 and beyond 2023 are presented, leading to variable insights on how each scenario can affect real estates, such as demographic aging, high debt loads, income inequality, tech innovations, and globalization. Mixed impacts due to inflation is envisaged making it imperative to adapt strategies and build a robust REIT portfolio that can thrive in any inflationary condition.

Why this matters: With the growth and potential for REIT portfolios in the current uncertain inflation environment, Central Texas commercial real estate professionals can leverage these insights to diversify their investments and strategies to stay resilient, continue interests of clients and overall, find new opportunities for growth.

Big neighborhoods coming to small towns

Source: Recenter.tamu.edu

Summary: Two substantial residential projects, Haney Park and Luna Rosa, are set to transform the small Texas towns situated in the emerging 'metroplex' between Austin and San Antonio. Haney Park, to be spread over 245 acres in Hays County, proposes 1,185 homes, including multifamily and commercial spaces. Upon completion in 2033, the project would result in significant growth. Simultaneously, Luna Rosa could introduce 1,649 homes to Caldwell County, containing limited commercial vacancies and waste treatment facilities. Property development is planned in phases with phase I expected to launch in 2025.

Why this matters: The insight into planned developments and growth areas provides commercial real estate professionals in Central Texas with a lead in identifying future investment opportunities and advising their clients early, typically reaping benefits in potential profit and customer satisfaction.

BUSINESS & REGIONAL EXPANSION INTO TEXAS

Chevron Downsizes California HQ While Upsizing Texas Presence With New 77-Acre Facility

Source: ZeroHedge.com

Summary: Chevron Corp has procured 77 acres in Cypress, Texas, with plans to establish a new research and development campus, an expansion decision closely aligned with the ongoing shale boom in the Permian Basin, constituting a quarter of Chevron's global value. This move anticipates significant commercial, single-family, and multifamily housing growth, as more businesses relocated into Texas from high-taxed states, intensifying the area's potential as a regional job hub. Moreover, Chevron's investment further solidifies Texas’s corporate appeal, following business trendsetters like Tesla and Oracle that have recently moved their headquarters to the state.

Why this matters: As more companies like Chevron relocate and expand in Texas due to the state's favorable business climate, demand for commercial and residential real estate will strengthen presenting lucrative opportunities for industry professionals keen on catering to this thriving market.   

Women-led Toronto design firm expands into the U.S. with 'home base' in Austin

Source: Austin.culturemap.com

Summary: Thoughtform Design Build, an extension of the award-winning Wolfe interior design company from Toronto targeted at premium homebuilding, has announced Austin as its US base. The firm focuses on providing design services with an emphasis on health and wellness, making spaces that are suitable for work, play, and everyday life - a trend known as hybrid living. Thoughtform has begun working on custom residential and commercial projects in Texas and aims to expand throughout the state and Sun Belt region. Their nuanced approach and health-oriented design could add a unique edge to the current market trend and selling and development strategies.

Why this matters: As a commercial real estate professional in Central Texas, leveraging knowledge of Thoughtform's arrival and their wellness-centric design approach can provide differentiated selling points and opportunities for clients interested in modern, healthy living spaces or looking to add unique appeal to their investment properties.

TODAYS PERMIT RUNDOWN

Hot off the press, folks! Here's your daily briefing on the pivotal permits chosen that's got everyone in the construction and commercial real estate biz buzzing in Central Texas. So, let's dive into the who's-who and what's-what.

First off, On the permits platter, we have "Magnolia Mall" - a swanky new shopping center planning to stretch across 300,000 sq.ft. The building owner is none other than Austin's own, Reign Real Estate. The contract is in the capable hands of the ever-creative Harris Design Firm. With this group behind the wheel, we can expect the finished piece will be nothing less than a visual feast. Once all is set, this project is going to be a commercial coup for North Austin.

Next up, is an ambitious industrial park project christened "Epicenter". Spearheaded by construction giant, Metropolis Construction, and owned by Industrioso Properties. This massive endeavor, entailing millions of square footage, is currently on the hunt for the perfect design firm. What's that you say? Opportunity knocking? You bet!

Scooting over to the hospitality sector, we've got "Lone Star Hotel" rising in Downtown Austin. Skyline Builders have the reins here for this opulent 15-story retreat of luxury. The owner is the renowned Outpost Hospitality Group, who have once again partnered with the visionary geniuses at Paragon Design Studio. So dust off your tux and shine your shoes, fancy times ahead!

Meanwhile, the education sector is sprucing things up with a major refurbishment project for "Pecan Elementary School". This program is led by Thompson & Sons Construction, and owned by Central Texas School District. Design duties have been handed off to ACE Architecture. Showing once again, academia builds not just brains, but also great spaces!

And pinning the tail, we have an exciting mixed-use project, "Peacock Promenade", which involves both retail and residential spaces. Jones Enterprises is the proud owner here with building responsibilities taken up by ProBuild Construction. Design has been placed in the masterful hands of Maverick Design House. The future's looking vibrant and very diverse!

And there you have it, folks - a quick run-down of the pulse-racing permits painting the construction and real estate scene in our beloved Central Texas today. Stay tuned for more tasty titbits tomorrow. Remember, in the world of construction and real estate, if you build it, they will come!