Stream Realty partnership launches big industrial development in Baytown
April 15, 2022
Stream Realty Partners has teamed with Principal Real Estate Investors on a 1 million-square-foot speculative industrial development in Baytown.
Stream, a national real estate services, development and investment company, announced plans to break ground on Portside Logistics Center at 4838 Borusan Road in the third quarter. Principal Real Estate Investors is the real estate investment group of Des Moines, Iowa-based Principal Global Investors.
The project, which has not yet signed tenants, will consist of a 760,000-square-foot cross-dock building with a 40-foot clear height and a 260,000-square-foot front-load building with a 36-foot clear height. The location near the Grand Parkway provides access to the Barbour’s Cut and Bayport container terminals, Interstate 10 and Texas 225.The deal builds upon a long relationship between the companies. Stream and Principal Real Estate developed the Bay Area Business Park, another industrial development near the Port of Houston, in multiple phases starting in 2008.
Once rare, 1 million-square-foot spec projects are happening more frequently as companies seek larger spaces for their distribution operations to handle increases in e-commerce and to better control their supply chains. The site is near another 1 million-square-foot spec development by Dallas-based Hunt Southwest that paid off recently with a lease from Walmart.
In another major lease in the area, Plastics Express took occupancy of more than 800,000 square feet in Cedar Port Logistics Center, a project of Savannah-based Capital Development Partners. The Webstaurant Store, an online restaurant supply store, recently leased the 643,940-square-foot Cedar Port Logistics I facility on the Grand Parkway.
Portside Logistics Center will add to 21 million square feet of industrial space under construction in the Houston market, according to commercial real estate firm CBRE. In the southeast submarket, 59 percent of the nearly 6.5 million square feet of industrial space under construction is pre-leased.
Houston was named the top growth market for big-box warehouses — those with 200,000 square feet or more — in North America in 2021, according to a CBRE report. Big-box leases shot up by nearly 30 percent to a total of 450 million square feet in North America last year.“With record-high Port Houston container volume and rapid population growth, Houston industrial leases are getting larger and larger with no signs of a slowdown in 2022,” Nathan Wynne, senior vice president with CBRE’s Industrial Services team said in the report. “Supply chain uncertainty and e-commerce demand are driving a shift from a just-in-time model to a just-in-case model for storing more inventory near population centers. Because of the tightening market and low inventory of existing first-generation warehouse space, we are seeing companies rush to sign sizable leases in speculative developments. These recent transactions are some of the largest deals in the history of the Houston industrial market.”