Energy Corridor Gets First Office-to-Resi Project

John Quinlan is doing his part to reduce Houston’s glut of empty old office space.

The investor, alongside DeBartolo Development and ARC3 Architecture, is transforming the former ConocoPhillips and BP building at 550 Westlake Park Boulevard into a 311-unit apartment building, the Houston Chronicle reported. The 420,000-square-foot building was constructed in 1983.

The $93 million office-to-residential conversion project dubbed The Watt comes as industry experts and politicians struggle to find an answer to the surplus of aging office space that’s plaguing office markets around the country.

The issue is acute in Houston, where there are 318 entirely empty office buildings and 625 that are less than 50 percent occupied, according to CoStar data. The vacancy rate for buildings completed before 2009 was 27.5 percent, according to the Greater Houston Partnership.

Even so, the complex architectural engineering and costs associated with converting old office towers has prevented many landlords from taking on similar projects.

The Watt made financial sense, as the original building was acquired for $21 million ($50 per square foot) in 2022 via online auction, which is far below replacement cost. The developer also saved money since the building already had a large parking garage and new mechanical equipment in the basement. Conversions cost about $300,000 per unit, DeBartolo’s Scott Waddington said. It costs more than $500,000 a unit to build a ground-up multifamily development.

The Watt will feature a rooftop pool, coworking spaces, a yoga and fitness center, a bike storage room and a club lounge with a golf simulator, as well as pet-friendly amenities such as a pet washing station. Rents start at $1,968 for studios and go up to $4,375 for three-bedroom apartments.

The project will provide needed housing to the Energy Corridor, which has become a popular place for companies to plant their offices. About 71,000 people work in the area, but there’s only 17,550 housing units, Zak Miller, manager of the Energy Corridor District, told the outlet.

This is the team’s third conversion project. DeBartolo and Quinlan debuted Elev8 at 1801 Smith Street in 2024; it’s currently 90 percent leased.

— Eric Weilbacher