In the 2nd quarter of 2017, Houston and the surrounding cities have seen the highest percentage of commercial vacancies since the year 1994. With a vacancy rate nearing 19 percent, proving that commercial real estate loans in Texas were already hurting before Hurricane Harvey hit. The area has been trying to bounce back, but since the hurricane has caused quite a bit of damage in its path, unfortunately, it could take even longer than expected for the Houston area to recover.
The real estate market including commercial real estate loans in Texas may take months to rebuild and could face many challenges while trying to do so. Local businesses not only have to clean up from all of the damage that was caused by the category 4 storm, which produced record breaking rain and flooding, they also have had to deal with loss of revenue for days or even weeks. The damages caused by the storm is only going to amplify already existing issues in southeastern Texas, leading many to fear that it might be too much for some to recover from.
Some businesses could face disruption for 2-3 months and some were forced to deal with these issues without power for several weeks. That is why it is hard for us to be able to predict the long-term impact of Hurricane Harvey had on commercial real estate loans in Texas. Luckily, the forecasts that have been released think that the area may be able to recover quicker that some other areas that have been impacted by previous hurricanes. But, it may take months for us to even know how much damaged was caused by the record-breaking storm.
After Hurricane Sandy hit the southern part of the United States, self-storage companies and local hotels saw a spike in businesses. The need for these two things sky rocketed after heavy storms hit the area and Houston can expect to see the same. While the southeastern part of the Lone Star state works on rebuilding, these companies could see some economic reward, but there is still a great deal of work to be done to repair all of the loss the area suffered from, especially with around 2,900 commercial properties being affected from the hurricane.
Luckily, it is estimated that most of the commercial businesses hit hard by Hurricane Harvey have coverage from flood insurance. This still doesn’t mean that it will take a lot of time and work to rebuild not only from Hurricane Harvey, but from the already suffering real estate market in the Houston area.
Dennis Dahlberg Broker/RI/CEO/MLO
Level 4 Funding LLC Private Hard Money Lender
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis@level4funding.com NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave |Austin | Texas | 78701
About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 42 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.