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Houston's HBDi Issues RFQ to Redevelop 20-Acre Mix-Use Business Park

07/14/2016 01:57:00 pm | Viewed: 844

Conceptual image of Palm Center-BTC with Metrorail

 

Posted: 7-14-2016, 3:17 p.m.

by Adolfo Pesquera

Houston (Harris Co.) - The Houston Business Development, Inc. on Tuesday July 12 issued a Request For Qualifications (RFQs) to identify an experienced, qualified, developer team to plan and co-develop parcels totaling about 20 acres located in the southeast area of Houston.

The site, commonly referred to as Palm Center, is owned by HBDi and the developer will act as a partner with HBDi to create a sustainable, medium density, mixed use, transit oriented development. The RFQ sets forth the project goals, explains selection criteria, and provides statement of qualifications and submittal requirements that the master development team must address in the proposal.

For additional information, interested parties may obtain a copy of the RFQ document at HBDi, 5330 Griggs Road, Houston, Texas 77021 or download a PDF copy here. The deadline for submission of proposals is 4 p.m., October 11, 2016.

Developers must take into account that Palm Center-BTC will be on a Metrorail route and will be adjacent to a light rail station. At present, HBDi foresees development of parcels within the project site proceeding in five (possibly six) sections or phases.

Excerpts from the Palm Center Business Technology Center Revelopment Plan:

Key Plan Concepts

Palm Center-BTC redevelopment concept

A series of discussions and work sessions with the HBDi Board and staff--combined with the Market Study and consideration of community input--resulted in a set of core concepts that frames the next generation programming of the Palm Center–BTC. These concepts were based on the idea that the Palm Center–BTC can serve as the nexus of a set of partnerships revolving around community needs, market and economic opportunities, and institutional organizations providing economic development, job training, youth entrepreneurship training, and healthcare services.

To accomplish this, HBDi will require collaborative partners. The team is preparing prospectus-like documents for use by HBDi in securing partnerships with nonprofit entities and private developers. These prospectus-like documents will enable HBDi to reach out to providers of employment and training services, retail services, housing, health care, and youth entrepreneurship.

Guided by this framework and pursuant to input from HBDi and community stakeholders, the consultant team has developed the following key components that the physical concept plan is designed to accommodate:

  • Conference and event facility
  • Commercial/retail/office space
  • Small business development programs
  • Healthcare services and training programs
  • Workforce development and skills training
  • Small business trade programs
  • Youth entrepreneurship programs
  • Public space, infrastructure, and facilities
Parceling and Circulation
Palm Center-BTC_Parceling_Plan
HBDi will proceed toward redevelopment without knowledge of the exact mix of uses and structure types that will ensue from its marketing and partnership formation. Therefore, the Plan accommodates a range of development opportunities that might arise.
A large institutional user could agree to develop a multi-story office/commercial building fronting the new plaza that would house workforce and small business development programs. Or, a private developer could ground lease space to develop new low-rise speculative office and retail space.
The division of the site into discrete parcels is based on new circulation routes throughout the site. The five different parcels provide opportunities to not only phase the redevelopment over time to match market conditions, but also to facilitate implementation strategies such as ground leases to different developers that will limit the direct financial exposure to HBDi. This strategy also allows parking to be relocated and expanded for each component over time, without losing needed parking for any particular occupant of the site.

All of the new circulation routes would be designed with a diverse array of transportation modes in mind, with attractive and ample sidewalks and comfortable biking accommodation.

The following summarizes the phasing approach with more detailed descriptions of the initial phases:
1. Beautification and Facade Improvement
  • Upgrade existing building facades
  • Renovate Building D and possibly other building interiors
  • Add public plaza at light rail station
  • Improve landscaping and walkways
PalmCenterBTC_conceptual_01_160928854.jpg
Plaza and landscaping is estimated at $750,000 plus design cost; building renovations at $3.5 million (facade redo and Building D interior only) up to $11 million for all existing space. Implementing this step could be done through leveraging internal assets and cash flow for private funding. Improvements will allow for future rent increases. Supplement funding for public plaza and sidewalks with TIRZ request. Seek further assistance from City of Houston Housing and Community Development Department (example: CDBG). Seek out conference / event facility operators about partnering on such a facility within Building D through a lease / operator agreement.
2. Initial Development: Small-Tenant Office/Commercial
  • Add 40,000 square feet of small-tenant office space with surface parking
  • Include up to 20,000 square feet of ground floor commercial / retail
  • Fronting on and activating public plaza
At a cost of about $9.5M to $10 million, this would be implemented through an RFP to commercial office and mixed-use developers for a ground lease development agreement, subject to design standards and target lease rate levels.
"Facilitate usage of Community Reinvestment Act, EB-5 international investors, and New Market Tax Credits to assist financing as appropriate. Offer incentives through City of Houston Chapter 380 agreements or directly from HBDi (reduced lease costs for example). Include designated restaurant / café space within commercial portion with kitchen and associated utilities already built out."
3. Long Term Future Phases: Incremental Commercial, Office and Medical Space
  • Time frame of 5 to 20 years
  • Cultivate anchor tenant partnerships with synergistic economic development and health service organizations;
  • Ground lease parcel by parcel to developers each parcel for new development, with structured parking:
1. Physical sit allows up to 271,000 sq.ft. additional office / medical space total over long term; larger increments
if anchor tenant partnerships created;
2. Up to 110,000 sq.ft. ground floor commercial / retail space, reduce as needed per market constraints.
Estimated cost of Step 3 is up to $75 million. The implementation strategy involves outreach through employment of a dedicated real estate broker and direct invitations to cultivated partners; offering of incentives from HBDi directly (reduced lease costs for example), or through arrangements with City of Houston for Chapter 380 agreements; promotion of New Markets Tax Credits, Community Reinvestment Act and EB-5 as incentives to attract private capital investment; tapping into large nonprofits, public agencies, traditional and nontraditional venture capital to provide other capital investment related to economic development or health care anchor tenants.
PalmCenterBTC_and_surrounding_development_108694473.jpg
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adolfo@virtualbx.com


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Adolfo Pesquera
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adolfo@virtualbx.com

Adolfo Pesquera is a veteran news journalist. He has previously worked for Hearst Corp., American Lawyer Media, News Corp and Freedom Communications. His work has been published in newspapers and magazines throughout the United States. He is a communications graduate of the University of Texas-PanAmerican.