Major Houston-area expansions lead to robust home sales

 

By Michelle Leigh Smith

Major commercial development plans by large corporations are often in the negotiation phase for years, and tight-lipped secrecy is the only way to ensure success.

“I remember when Conoco made the decision to move out of Greenway Plaza, long before the merger with Phillips Petroleum Co.,” recalled David Hightower, executive vice president and chief development officer for Wolff Cos., a longtime Houston land development and investment firm. “When they came to our offices, they would rent cars and only use first names. We didn’t know who they were or where they were from — it turned out to be a distance of two miles, but they still rented cars just to make sure no one could run a license plate,” said Hightower.

Many companies decline to share details about themselves during initial meetings with third parties. The Greater Houston Partnership often deals with outside consultants hired by a company who only share “Our client is an engineering company and they are looking at Houston” or “It’s a manufacturing concern and Houston is on their short list,” said Patrick Jankowski, vice president of research for the GHP. “Quite often, that’s all we know about the company we are trying to recruit.”

Due to the confidentiality of the deal, relocation projects are often given code names — the GHP has worked on Project Ice, Eagle, Electron, Victory, Moscow and Muskrat, Jankowski said.

One of the largest and most secretive projects to-date is Irving, Texas-based Exxon Mobil Corp.’s (NYSE: XOM) 385-acre campus that is under construction in north Houston. The energy company will relocate thousands of employees from various locations in Virginia, Ohio and around Houston to its new campus south of the Woodlands, starting in early 2014, with the transfers to be complete in 2015.

However, there were rumors that Exxon was coming to the Woodlands area for years before any formal announcement was made.

“We worked on the project for two years before we knew who it was,” said Jim Kollaer, director of Houston-based consulting firm Kollaer Advisors LLC. “So many times, strategies are developed internally and you don’t even know it’s going on. When there’s a (master-planned community) that works with the corporate strategy, then that’s the best of all worlds,” said Kollaer, who is the former head of the GHP.

When a company is getting ready for a move, it prefers that community leaders where they are now to not know they plan to leave for a plethora of reasons, experts said. The company would be inundated by the leaders begging them to stay, relocation costs could be hiked in the community to which the company plans to move and there are concerns about employees who are not offered a relocation package either being uncooperative or kicking back on their productivity.

“When you get an Exxon, that’s going to create a lot of rooftops,” Jankowski said. “There’s going to be a mini-population boom in that part of Houston even though a lot of people live there already. That’s going to drive the demand for housing.”

Indeed, the 3,000-acre master-planned community between the Woodlands and Conroe known as Woodforest is seeing record sales — new home sales are 82 percent higher in Woodforest than at the same time last year.

“Exxon is now the current employer that is spurring the growth in the master-planned communities in the Woodlands and Spring areas,” said Anne Incorvia, vice president of relocation and development at Martha Turner Properties.

From her vantage point, Incorvia sees multiple oil and gas subsidiaries driving sales in Creekside, which is on the outskirts of the Woodlands, and in Bridgeland and Fall Creek. Some people also are moving into the central areas of town, such as River Oaks, Galleria, Tanglewood and Memorial because of easy transportation on Metro to the Woodlands.

“There are a number of Exxon Mobil employees who do not plan to move to the Woodlands,” said Jamie Barrere, a Realtor with Heritage Texas Properties. “I have found many of the younger ones are still buying in the Washington Corridor, rather than opting to buy closer to work. For them, the best part of working in Houston is the ability to live around and close to other young professionals and be near the eating, drinking, entertainment and shopping areas of those peers.”

For the complete article, please go to:
http://www.bizjournals.com/houston/print-edition/2013/08/23/major-expansions-by-companies-in-the.html