Rising apartment demand may have scrapped previously planned economic incentives for Museum Place development, but two hotels, multifamily living and retail planned east and west of Van Cliburn Way remain intact.
“We met with the city and decided jointly that it made more sense to terminate that agreement,” said Reece Pettigrew, chief financial officer at JaGee Holdings LLP, the developer of Museum Place.
At issue was an agreement signed in 2008 promising tax incentives for multifamily development in the 12-acre Museum Place, a mixed-use retail, restaurant, retail, office and hotel development just north of several museums bounded by Camp Bowie Boulevard to the south, West Sixth Street to the north, University Drive to the east and Boland Street to the west.
But stronger apartment demand has lessened the need for such incentives while another market sector still may pursue those ends.
“Rents have risen, maybe not as much as many had hoped, but still faster here than in lots of other parts of the country,” said Pettigrew, explaining that hotel and motel developers still may require some sort of incentive.
From hotel rooms to retail, several additions are planned for what’s referred to as blocks A and B of Museum Place, the former area west of Van Cliburn Way and north of Camp Bowie, the latter east of Van Cliburn Way and north of Camp Bowie.
Planned for block A are a 170-room, full-service hotel with adjacent restaurant-bar and meeting-banquet space, as well as ground-level retail. An unnamed developer is behind the project, according to Pettigrew and Richard Garvey, also with JaGee.
Also planned for block A is a 250-room apartment complex and 15,000 square feet of ground-level retail. A 600-space parking structure is planned to be built and serve the hotel, apartment property and retail, as well. Museum Place officials are working with Michael J. Hoffer of Hahnfeld Hoffer Stanford Architects and Dunaway Associates Inc. of Fort Worth on civil engineering for the parking structure.
The hotel and apartment complex would be funded by their respective developers, whose identities have not been specified. Both are in preliminary design stages, with construction expected to begin in early 2017 and reach completed by mid-2018.
Meanwhile, block B awaits a limited-service hotel, office building, retail-restaurant space and a shared parking structure.
Construction could begin sometime this year and reach completion within 18 months.
Each developer has its own lead architect, landscape architect, engineer and other firms associated with the project, though they have not been publicly disclosed.
“There is considerable demand for hotel rooms and amenities that this will bring,” said Pettigrew of plans discussed and debated for several years.
Meanwhile, several other Museum Place leases have been confirmed:
• Jimmy Neeley, owner of Woody Creek BBQ, has leased 4,850 square feet at 3200 West Seventh St. (Block C) for a new concept utilizing his experience with smoked meats with Mexican influences, a full bar and a casual open-air vibe, offering breakfast, lunch, dinner and late-night dining options.
• bodybar Studios, at 3232 West Seventh St., will open on Aug.1. It is expected to offer a boutique fitness studio featuring equipment-based, high-intensity classes inspired Pilates principles.
• Mr. Gatti’s Pizza has leased 5,319 square feet at 3268 West Seventh St. The concept was acquired by a Fort Worth investment firm last year, with the Museum Place location serving as its flagship store. It will feature a demonstration location for new franchisees and a test kitchen for new menu items. Mr. Gatti’s recently received its building permit from the city of Fort Worth and will be under construction soon. It is expected to open sometime this fall.
• Vue du Musee apartments, featuring 217 Class A rental units at 3248 West Seventh St. with leasing offices at 701 Arch Adams, is currently 98 percent leased.
• The first phase of Museum Place included 34 condominium units at 3100 West Seventh St. (One Museum Place) and five condominium units at 3300 West Seventh. After strong sales in 2014-2015, 14 one- and two-bedroom units remain at One Museum Place, with three units remaining at Corner Store Condos. – A. Lee Graham
D.R. Horton adds Freedom Homes
Fort Worth-based D.R. Horton Inc., the largest U.S. homebuilder, is adding a new line of affordable homes aimed at seniors to its lineup of brands.
The new brand, Freedom Homes, will initially be offered in Florida, Texas and Arizona and be open in at least eight markets by the end of fiscal 2016 and in approximately one-third of D.R. Horton’s 78 operating markets by the end of fiscal 2017, according to a company news release. No details were provided on pricing or square-footage of the new brand.
According to a report from Bloomberg, D.R. Horton said in a conference call last week that its lower-cost Express homes, aimed at younger, entry-level buyers, have been popular with seniors in markets with many retirees.
“We are excited to offer Freedom Homes as an affordable alternative for active adults seeking a carefree low-maintenance lifestyle in an age-restricted community,” said Donald R. Horton, chairman of the board. “We strive to be the leading builder in each of our operating markets across our broad geographic footprint, and the addition of Freedom Homes to our diverse family of brands will allow us to continue to expand our industry-leading market share.” – Robert Francis
Homes are moving
Get ready to move if you have a house on the market. According to the June Zillow Real Estate Market report, homes are selling an average of a week faster than they did a year ago.
Tight inventory continues to be a major factor for home shoppers. The supply of homes for sale is nearly 5 percent lower than it was a year ago, and 38 percent lower than its peak level in 2011. With fewer available options, home shoppers are moving quickly to buy homes, with the average U.S. home closing after 78 days on the market.
The 78-day average includes the time it takes to close, which is usually one or two months after the home goes under contract. This means that homes are pending within about a month of being listed.
The length of time homes stay on the market before selling has been steadily decreasing since 2010, when homes took an average of five months to sell. The average time home buyers had in Pittsburgh, Philadelphia and Charlotte, N.C. dropped by at least two weeks, the biggest change among the largest U.S. metros. In the Dallas-Fort Worth market, the average time home buyers had to sell a home was 56 days, down six days from a year earlier.
“Homes are selling faster than ever as the home shopping season hits its peak,” said Zillow Chief Economist Dr. Svenja Gudell. “If you’re looking for a home, be prepared to move quickly. Adding to this difficult buying environment is low inventory – there simply aren’t many homes to choose from. And while this looks like a good time to be a seller, potential move-up buyers may hesitate to list their homes and become buyers. Until the supply increases, it will remain a tough market to find a home.”
The low inventory and quick-moving market combine to create a competitive home shopping market, especially for potential buyers looking for less expensive homes. The most expensive third of the market has experienced the smallest drop in available inventory compared to the rest of the market.
The limited supply of homes is driving home values higher. The average U.S. home is worth $187,000, a 5.4 percent increase from June 2015. Home values have been increasing at 5 percent or faster on an annual basis for the past eight months.
Rents are growing at the slowest pace in nearly two years, up 2.6 percent to a Zillow Rent Index of $1,409. – Robert Francis
Mortgage rates are up again
Mortgage rates moved higher for the third week in a row as financial markets awaited the outcome of the Federal Reserve’s meeting this week.
As expected, the central bank left the benchmark rate unchanged but was more upbeat in its assessment of the U.S. economy in its first meeting since Brexit. That could mean a rate hike is on the table for later this year.
The Fed news came too late in the week to be factored into Freddie Mac’s mortgage rates survey. The government-backed mortgage-backer aggregates current rates weekly from 125 lenders across the country to come up with a national average mortgage rate.
Rates did not increase much this week and continue to be low. Even as they continue to climb, they remain below norms. Bankrate.com, which puts out a weekly mortgage rate trend index, found that a third of the experts it surveyed believe rates will rise in the coming weeks. More than half thought they would remain unchanged.
According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average crept up to 3.48 percent with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.45 percent a week ago and 50 basis points below (3.98 percent) where it was a year ago. (A basis point is 0.01 percentage point.) The 30-year fixed rate hasn’t been above 3.5 percent since late June.
The 15-year fixed-rate average also was higher, ticking up to 2.78 percent with an average 0.5 point. It was 2.75 percent a week ago and 3.17 percent a year ago.
The five-year adjustable rate average was unchanged from the previous week at 2.78 percent with an average 0.5 point. It was 2.95 percent a year ago.
“The 10-year Treasury yield remained flat this week in anticipation of the Fed’s July policy meeting,” Sean Becketti, Freddie Mac chief economist, said in a statement.
“Mortgage rates, on the other hand, rose another 3 basis points to 3.48 percent. Nonetheless, home sales continue to benefit from the persistently low mortgage rates with June’s new home sales coming in at an annualized rate of 592,000 homes – its fastest pace since 2008.”
Meanwhile, mortgage applications decreased again this week, according to the latest data from the Mortgage Bankers Association.
The market composite index – a measure of total loan application volume – fell 11.2 percent from the previous week. The refinance index, which is the most sensitive to rate increases, dropped 15 percent, while the purchase index declined 3 percent.
The refinance share of mortgage activity accounted for 61.1 percent of all applications.
“Mortgage rates increased last week on strong housing market data,” said Mike Fratantoni, MBA’s chief economist. “As the pool of borrowers who can benefit from refinancing continues to dry up, even relatively small rate changes make bigger impacts on the overall refinance volume. Despite the 30 year fixed mortgage rate being almost 50 basis points lower than a year ago, applications to refinance dropped 15 percent last week.” – Washington Post