A new four-story medical office building planned for the Memorial Hermann The Woodlands campus is yet another sign of the economic growth in The Woodlands. The $15 million building is one of three recently announced by Memorial Hermann in the Houston area; identical facilities will be built in Sugar Land and Katy, Chief Facility Services Officer Marshall Heins said.

All three 100,000-square-foot buildings are planned in areas where occupancy and demand are high.

"In the Woodlands, we have three buildings already, and the occupancy is near 100 percent," Heins said. "We are expecting to have some of it pre-leased because of the demand to move to that campus. The same is true for the Katy and Sugar Land markets. In Katy, we just [developed] a $70 million inpatient tower, and the existing buildings there are full."

Groundbreaking at The Woodlands will take place roughly nine months after completion of a new 700-car parking garage to be located directly south of Office Building No. 2, Heins said.

Though the three new office buildings announced by Memorial Hermann will be designed to be identical, The Woodlands location will be the only one featuring a first floor with medical retail—tenants such as optical shops, medical goods suppliers and pharmacies.

The remaining floors will be leased as office space to physicians and other medical professionals.

"[The Woodlands] campus is experiencing a lot of growth," Heins said. "We added an east tower a few months ago."

That facility was a seven-story, $80 million expansion that included additional plans for future build out.

The Woodlands is in the midst of a strong market for commercial office interest. The Woodlands submarket is described as "quickly becoming the newest Energy Corridor" in a recently released Research and Forecast Report from Colliers International.

In fact, demand for office space in 2012 pushed Class A space vacancy rates below 1 percent, the report said.

Though some of the expected growth is attributed to ExxonMobil, which recently began construction of its 3.5-million-square-foot campus just south of The Woodlands, Heins said expansion was planned regardless.

"Even without Exxon, today we are at capacity," Heins said. "That's why we added a new tower, and with Exxon coming, we are looking at that and have the ability to handle that capacity as well."

In January, Memorial Hermann The Woodlands announced plans for a new $80 million, seven-story patient tower. The 240,000-square-foot facility will include a surgical center, pre-op and patient recover rooms and a waiting area.

In addition, four stories of the new patient tower will accommodate future growth of the Memorial Hermann The Woodlands camps.

Expansion of the campus will likely continue beyond the new office building. Memorial Hermann's master plan identifies sites for two additional inpatient towers to accommodate growth, Heins said.

"With all our campuses, we are always looking long term," Heins said. "If we put that garage here, how does it affect our master plan?"

Unlike other fast-growing suburban communities, The Woodlands does not have a large supply of land for expansion.

But Alex Sutton, co-president of The Woodlands Development Company, said this is not a challenge for expanding.

"There are various options for development in The Woodlands area, including vertical," he said.

Heins agreed The Woodlands campus does indeed tend to go up rather than out.

"In Katy, we have a little more land to work with," he said. "In The Woodlands, we've identified future building sites and spoken to The Woodlands [Development Company] about acquiring additional land."

Even so, free parking—a big selling point for patients' staying within their communities for health care—thus far has remained a priority.

"People want convenient parking," Heins said. "Typically they are stressed or medicated and not feeling well, and Memorial Hermann has agreed to continue to have parking free at The Woodlands campus. This will be our third garage, and they do cost money to build, but we still are not charging to park on campus."

Construction on the $9 million parking garage will begin within 90 days, he said.


NCAA swim meet makes $1.5 million splash

By Matt Stephens

Hosting its first NCAA Division III Swimming and Diving Championships in March, representatives of the City of Shenandoah were not sure what to expect from an event of that magnitude. However, early estimates indicate the event brought in $1.5 million in retail and hotel dollars to the city.

"Being the first event and being the national stage, [we] really didn't know what to expect," Shenandoah City Administrator Greg Smith said. "The event turned out a lot better than what I think we all anticipated."

Smith estimated $858,000 was spent by visitors at restaurants and shops based on a conservative average of $150 spent per guest per night on retail within the community. Hotels also earned more than $700,000 as a result of the event, Smith said, with 5,720 hotel nights estimated from the teams and spectators. With 565 hotel rooms in Shenandoah, and a nearby NASA conference being held that week, Smith said, hotels were sold out from Conroe to as far as 20 miles south of the city.

"This was truly an area impact," he said.

Restaurants and retailers believe the event weekend was one of their busiest, Smith said. Some restaurants that normally do not take reservations were booking groups.

The NCAA meet brought 537 athletes, 180 coaches and an estimated 2.5 fans—including friends and family members—per student athlete, totaling about 2,000-plus visitors, Smith said. No participating universities came from Texas.

Although Smith said there were a few local spectators, the event sold out within about an hour of tickets going on sale online.

In addition to the direct economic impact on the city, Smith said there is no dollar figure that can measure the notoriety the city's partnership with the NCAA brought the community.

"It gave us an identity with the sports arena, which is what one of the long-term goals was when the [city] decided to partner with CISD and the Natatorium and Woodforest Stadium," Smith said. "Those two facilities are the two biggest selling points that are within Shenandoah."

Smith said the city had anticipated about $90,000-$100,000 would be spent on the event, although certain unforeseen costs will likely increase the figure to somewhere between $130,000 and $150,000.

"The economic impact definitely outweighs the expenses," Smith said.

Shenandoah and Conroe ISD hope to become a partner city with the NCAA, Smith said, and have been in discussions with the organization for about 14 months. Smith said they could also pursue future events in sports such as soccer, football, cross country and golf.

CISD Natatorium Director Sam Fruia said the possibility of hosting future events at either of the two CISD venues would depend on their availability. Timing for the swimming and diving championships was ideal, because area teams had completed their competitions for the season, Fruia said.

"Running the event this year is an example that the natatorium can step up its game for these type of events," Fruia said.

J.P. Williams, assistant director of Championships and Alliances for the NCAA, said the event was well received by the participants. Williams said the venue performed well and the pool was fast, with nine records broken at the meet. While he could not speak for all of the NCAA, he said he would be pleased if Shenandoah made bids for future events.

"Everything we asked for, Greg Smith and the city staff provided," Williams said. "We're definitely happy with the way the community rallied around its events."