Mercantile manievers

Residential growth throughout the Conroe area continues to attract large-scale commercial and mixed-use development to the I-45 corridor.

Projects such as the 750,000-square-foot 336 Marketplace and the 115-acre Conroe Waterfront Center along I-45 are among several major commercial tracts of land under development in Conroe. Once complete, the projects are expected to include retail and dining establishments as well as multifamily housing and hotel, office and medical space.

“There has been a lag with retail, especially in Conroe,” local commercial real estate broker Wade Nelson said. “Retailers are basically playing catch-up because there has been a tremendous amount of population growth here, and now the retailers are scrambling to get caught back up and taking premier sites.”

336 Marketplace

336 Marketplace

Select retailers at Grand Central Park’s 336 Marketplace are expected to open in spring 2017. Located at the intersection of I-45 and South Loop 336, the project will include national retail, dining and entertainment establishments. Proposed tenants include Kroger, Gander Mountain, Ross, Marshalls, Home Goods and a Cinemark movie theater, according to the site plan created by developer Fidelis Realty Partners.

Fidelis Realty Partners could not confirm the tenants as of press time.

Once complete, Grand Central Park will span 2,046 acres and is expected to include Town Center on Deer Lake, which will feature boutiques and restaurants, office space and urban-style living options. The town center will also include a public marketplace for outdoor art shows, water features and tree-lined open space, according to Johnson Development.

“In Town Center on Deer Lake, visitors to Grand Central Park will find additional first-floor retail along with outdoor dining at bistros and cafes,” Johnson Development said in a statement. “Retail and commercial space also will be located on more than 2 miles of I-45 frontage and in several interior locations within the property.”

Johnson Development officials said Grand Central Park’s location was selected because of its proximity to major employers as well as demand for housing. The company cited proximity to The Woodlands, Conroe-North Houston Regional Airport, George Bush Intercontinental Airport and the ExxonMobil corporate campus in Spring as factors in its decision to purchase the property.

“When considering a property, we first examine if there is demand in the market for new homes,” the company said in a statement. “Conroe has become a high-growth area with strong demographics and significant disposable income. Plus, it’s a city with great leadership.”

Conroe Waterfront Center

Conroe Waterfront Center

With 115 acres of land under development along I-45, the Conroe Waterfront Center is expected to accommodate high-end business and amenities in Conroe. The southern end of the property features a lake that will be surrounded by a hotel, retail, office and medical space.

“We have interest from several hotel groups. We are really trying to make sure we pick the right brand and the right developer,” said Brad LyBrand, NewQuest Commercial Properties Real Estate Broker.

The project has earmarked 14 acres of land along the I-45 frontage road for restaurants. That section of the development borders the southern end of the existing Conroe Marketplace and could break ground by the third quarter of this year, LyBrand said.

He said the lakefront setting combined with I-45 access is expected to draw high-end restaurants to the area.

“On the east side of that [land], there is a large lake—it is very appealing,” LyBrand said. “The market is still underserved from some of the nicer restaurants, so you could have a waterfront setting for the restaurant and hotel uses.”

Lybrand said the eastern side of the lake will feature a campus environment that spans about 60 acres of land with about 23 acres of office space.

“We think at the end of the day, that would be a very nice site for [an] office or a corporate campus type of environment or some medical that would be waterfront, and you will still have excellent visibility from I-45,” LyBrand said.

The company has also sold a 14-acre tract of land north of the lake that includes a 60,000-square-foot office building within the development to an undisclosed international company at the end of 2015, LyBrand said.

Additionally, the northern end of the property is expected to feature multifamily housing as well as retail and restaurant space along FM 3083. LyBrand said the multifamily housing property will not be developed until a future phase of the project.

Market trends

Rapid residential development started in 2012 in areas surrounding The Woodlands, Nelson said. However, development has migrated north along I-45 because The Woodlands is reaching build-out. Conroe’s population increased by nearly 4,500 residents between 2012 and 2014, or 7.2 percent, according to data from the Census Bureau.

Although there has been a significant amount of residential growth in communities, such as West Fork Estates, Harpers Preserve, Fosters Ridge and Water Crest on Lake Conroe in recent years, Nelson said focus has since shifted into commercial development. To that end, retailers are showing interest in major corridors that intersect with I-45, such as Hwy. 105, FM 1488 and FM 1097.

“That is where all of the activity is today—on the mixed-use and retail side,” he said. “You still have developers taking on the single-family tracts for development but on a smaller scale.”

Nelson said Grand Central Park, along with the future development of a 2,000-acre property owned by the Howard Hughes Corporation on I-45 and FM 1097, has fueled interest in commercial development in the area.

“What happens is the national retailers take notice,” Nelson said. “There are several projects that are in the middle of negotiations, and it is not time to announce them, but we are getting close. There is a lot of interest on FM 1488 and the Old Conroe Road area and also on the north side of Conroe between North Loop 336 and League Line Road.”

Despite the downturn in the oil industry, interest in development has remained strong in Conroe, said Nancy Mikeska, assistant director of community development for the city of Conroe.

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“Not only do we have new structures, we also have a lot of renovations. That tells you economic growth is still very strong, and [those businesses] are going to be here a while,” Mikeska said.

The city of Willis is also expecting additional development along the I-45 corridor with two large land tracts for sale. One tract encompasses 700 acres on the east side of I-45 between FM 1097 and FM 830, while a 1,500-acre tract is located on the west side of I-45 between Longstreet and Calvary roads, Willis City Manager Hector Forestier said.

“I know that a number of developers have been looking at those two locations, but right now we don’t know if it is going to be commercial, residential or if it is going to be mixed-use,” Forestier said. “I think the fact that the oil economy tanked in the last year or so is making it a little more difficult for people to develop.”