Monday AM October 8th, 2007
by: Ed Mayberry, October 8, 2007 5:10:00 am
Houston's office leasing market posted another healthy quarter, registering 764,649 square feet of positive absorption, according to Grubb & Ellis. Houston's overall vacancy fell by 30 basis points to 12.4 percent, reaching its lowest level since 1999. Overall full-service asking rents increased by 5.5 percent, marking a new record high for citywide asking rents. Speculative office space under construction stands at 4.3 million square feet, marking the highest construction level since the end of 1998.
Houston developer Levcor has purchased Northwest Mall from Glimcher Realty Trust, according to the Houston Chronicle. Levcor is also buying an empty building on an adjacent site from a European investment group. The developer plans to renovate the 50-acre site, at U.S. 290 and Loop 610, and make it a mixed-use center. There are plans to possibly add hotel and residential components. Northwest Mall has about 75 stores.
Rates on 30-year mortgages fell after two straight weeks of gains. Mortgage giant Freddie Mac says that 30-year, fixed-rate mortgages average 6.37 percent, down from 6.42 percent the previous week. After hitting a high this year of 6.73 percent in mid-July, rates have been edging lower as the worst slump in housing in 16 years has contributed to slower economic growth and fewer worries about inflation. Rates on 15-year fixed-rate mortgages averaged 6.03 percent. That is down from 6.09 percent the previous week. Rates on five-year adjustable rate mortgages averaged 6.11 percent, down from 6.15 percent. One-year arms averaged 5.58 percent, down from 5.60 percent. The mortgage rates don't include add-on fees known as points. Thirty-year mortgages, 15-year and five-year mortgages all carried a nationwide average fee of 0.5 point while one-year adjustable-rate mortgages had an average fee of 0.6 point.
ConocoPhillips' bet on natural gas prices has yet to pay off. While crude oil prices rose to above $80 a barrel, U.S. natural gas prices slumped in the third quarter. This has deeper ramifications for Houston-based ConocoPhillips than for rivals Chevron and Irving-based ExxonMobil. That's because natural gas accounts for 44 percent of the ConocoPhillips portfolio. The company says natural gas at the Henry hub sold for about $6.16 per million British Thermal Units in the third quarter. That's down from $7.55 in the second quarter and $6.58 in the year-ago period. Oppenheimer & Company estimates that low natural gas prices will reduce ConocoPhillips' third-quarter earnings by about $280 million, compared with the second quarter. ConocoPhillips increased its exposure to gas-price volatility in 2006 when it acquired Burlington Resources. The multi-billion-dollar deal doubled its North American natural gas reserves but was panned by analysts.
The Senate has voted to add a billion dollars to NASA's budget. The funds would replenish NASA accounts that were used to make improvements to the space shuttle program after the Columbia disaster. The agency has used more than $2.5 billion from other non-shuttle accounts for costs including safety upgrades. The Senate added the funding to a $56 billion spending bill for science programs and for the Departments of Commerce and Justice. Earlier, lawmakers added $1.5 billion for law enforcement that President Bush sought to kill. There won't be a final vote until after a weeklong recess and President Bush has already said he'll veto it as excessive. The spending bill is just one of a dozen that cover the fiscal year that began last Monday.
The U.S. Department of Labor's Office of Federal Contract Compliance Program says Houston-based Tetra Applied Technologies has settled allegations that it engaged in hiring discrimination based on race. The settlement of $145,000 is on behalf of 109 black applicants who were found to have been disproportionately eliminated from consideration for employment. Tetra will hire 14 members of the class into laborer positions, and the firm will undertake extensive self-monitoring measurements for two years to make sure hiring practices comply with the law.
Three Houston-area entrepreneurs are among five winners in the Make Mine a Million $ Business awards program. The event was held in Austin as part of the Texas Conference for Women. The winners include Gayla Bentley of Gayla Bentley, L.P., Carolyn Morse of Powerlung and Lelani Craig of Sugar Land-based CommGap. Ten Texas women entrepreneurs competed for the five awards that include money, marketing, mentoring and technology resources designed to help them reach $1 million in annual revenues. Texas is home to the second-largest concentration of women-owned businesses in the country.
Schlumberger is acquiring a minority interest in Norwegian-based PetroMaker, which specializes in the development of marine electromagnetics technologies. Electromagnetics is a subsurface measurement used by the oil and gas industry for enhanced reservoir description.
Half Price Books opens its first Pearland store on Thursday, on Smith Ranch Road. The new 8,400-square-foot store will buy and sell new and used books, magazines, comics, records, CDs, videotapes and DVDs. Dallas-based Half Price Books employs 233 in 11 locations in the Houston area.
A gas drilling company is making a bet at Lone Star Park--and it has nothing to do with winning a race. Dale Resources paid $1.14 million to lease 317 acres under and around the horse racing track in Grand Prairie. If the company finds natural gas, it will pay a 25 percent royalty to Grand Prairie's Sports Facilities Development, which owns the park.
The publisher of Better Homes and Gardens magazine announced that it's bought the Dallas-based marketing firm Directive. Directive was bought by Meredith, an Iowa-based publisher. Meredith says its acquisition of directive will help bolster its marketing division. Terms of the deal haven't been released.
It was two years ago when Dell opened its massive computer assembly plant in Winston-Salem, North Carolina. The Round Rock-based company employs more than 1,100 employees at the $115 million plant, which it built after receiving state and local tax incentives that could be worth up to $305 million. In exchange, Dell is obligated to create at least 1,500 jobs over five years and spend at least $100 million on local operations. Bob Leak, Jr., is the president of Winston-Salem business and the top negotiator of the local Dell incentives. He says he expects the dell plant to have created at least 3,000 jobs within five years. The plant is currently only running at two-thirds capacity, but has shipped more than six million desktop computers since it opened.