Hines Sets Record in Retail, Office Buy in Houston’s Montrose

Hines smashed another Houston real estate record, this time with a splashy retail-and-office buy in Montrose.

The global developer’s nontraded Real Estate Investment Trust, Hines Global Income Trust, paid $137.6 million for Montrose Collective, a 189,000-square-foot mixed-use project at 888 Westheimer Road, according to an SEC filing Bisnow reported. The deal pencils out to about $728 per square foot — more than triple the metro’s average retail price per square foot of $223 last quarter.

The project, developed by Radom Capital, was completed in 2023 after a pandemic-delayed build that mixed new construction with adaptive reuse across 2.4 acres. It includes about 100,000 square feet of offices leased to tenants such as Live Nation and renewable energy firm Pattern Energy, plus 50,000 square feet of retail anchored by restaurants, boutiques and fitness brands like Uchi and Solidcore. The development also houses the Freed-Montrose branch of the Houston Public Library, part of a land-swap deal with the city.

The property is fully leased, according to Hines’ SEC disclosure. The buy resets the city’s price-per-foot high-water mark, a record Hines itself set last year with its $145 million purchase of 200 Park Place, an office tower that traded for about $700 per square foot. The Montrose Collective trade also arrives as Houston retail investment volume climbs from a subdued 2023.

It wasn’t the only eye-popping retail deal this summer. Brixmor Property Group, a New York firm, dropped $233 million for LaCenterra at Cinco Ranch in Katy, a 409,000-square-foot lifestyle center. That deal worked out to $545 per square foot, more than double the metro average.

Investors and developers have been watching closely for what Montrose Collective would fetch, given its high-profile tenants and prime urban location. For the Hines REIT, which has been busy scooping up trophy assets in its home market, the Montrose deal underscores a willingness to pay top dollar for curated, experience-driven real estate.

— Eric Weilbacher