IRR-Houston Mid-Year Viewpoint 2015 Local Market Report - Lodging
The prediction for hotels is that they will moderate in 2015. Even with the slump in oil prices, Houston will have less direct exposure to the energy industry, and hotel performance in this market will be less affected by oil and gas workforce reduction. Houston may see a downturn in line with lower corporate spending, but the presence of major medical facilities that draw visitors from around the world will avert a greater erosion of room demand.
Tillman Fertita, billionaire CEO of Landry’s, is developing The Post Oak. This is a 650,000 square foot tower featuring 240 luxury hotel rooms, 120,000 square foot boutique office and 22 apartments. It will include a pool, two-story spa and salon, and multiple signature restaurant and retail offerings. Tillman Fertitta is dropping one million dollars to transplant large specimen oak trees to the site. The new development will sit on 10 acres along West Loop South in the Galleria.
Adjacent to the tower, Tilman Fertitta is building a 30,000 square foot ballroom and conference center. A 16,000 square foot main ballroom will be the largest in the area. The ballroom will feature the unique decorations of Bentley and Rolls-Royce cars. These will be displayed by Post Oak Motor Cars. The Post Oak, master designed by Gensler and built by Tellepsen, will deliver in the fall of 2017.
For the outlook on investments in the lodging industry, new brands will encourage greater consideration of dispositions in the year ahead, providing investors opportunities to purchase existing properties with in-place demand drivers.
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IRR Mid-Year Viewpoint 2015 comprises a National Overview report and 300+ two-page Local Market Reports for all key property types as well as additional resources, including metrics methodology, graphs, and tables; these free reports may be downloaded from IRR’s site here.