Developer seeks to make up for ‘Where?’ with ‘Wow’
Project to build high-rise condominiums on Allen Parkway ‘risky’ due to location, but conveniences could draw residents
The condominiums in The Allen, a 34story hotel and residential tower planned along Allen Parkway, will have unobstructed views of the downtown skyline. Residents will be just steps from the leafy trails of Buffalo Bayou Park and have access to lavish hotel amenities, including room service and housekeeping.
Yet even with all the highend finishes and luxurious conveniences planned for the project, developer Roberto Contreras is nervous about
one thing: the location.
“For a developer, it’s risky. It’s not Uptown. It’s not River Oaks,” Contreras said this week, from a sales center on the site, set between a public housing complex and the Federal Reserve Bank building at Allen Parkway and Gillette. “That is the challenge we have.”
He’s doing everything he can to make sure people who walk into the building are appropriately wowed. He spent $500,000 on the 2,900square-foot sales center, which has a high-tech 3D video system that gives virtual tours of the tower and each in
dividual unit. In a full-size model kitchen, sales agents can demonstrate one of the fancier upgrades: an induction cooktop that heats only the pot or pan that sits on it. Contreras even commissioned a 7-foot-tall architectural model of the building made of Legos to greet prospective buyers.
The tower will combine 178 hotel rooms on the first 14 floors with 99 residences on the top 20. Westmont Hospitality Group is a partner in the hotel, which will be operated by a Hyatt Corp. brand called Thompson Hotels.
The building is part of a larger plan for the 6-acre site. Architects have designed a mixed-use development that would also include an office tower, upscale apartments, green space and a pavilion with retail, dining options and a health club. The pavilion will be built at the same time as the hotel-condo tower. Together, both buildings have an estimated development cost of $254 million.
While the location of the project is a short drive to Houston’s cultural and sports destinations, the medical center and upscale housing, it lacks the walkability of areas such as Uptown or inside the West Loop near San Felipe, where multiple towers have been built or are under construction.
“I think what’s specific about that project is that he is developing the destination,” Jacob Sudhoff, president of Sudhoff Cos., which markets luxury condos, said of Contreras’ plan. “If it was just the hotel-condo sitting there, I think it would be much more difficult.”
Most of the units at The Allen will be priced starting at around $1 million. A limited number of one-bedroom plans will start at $500,000, and 16 units considered “penthouse class” will start at $2.6 million.
Maintenance fees are expected to be around 70 cents per square foot. Parking will be below ground.
“We want to appeal to the empty-nester who has a house in Houston and their lifestyle has changed. They’re traveling and they don’t want to worry about flooding. They don’t want to worry about security. They don’t want to worry about maintenance,” Contreras said.
The market for high-rise condominiums is relatively small in Houston and demand for units has fluctuated over the years.
Two years ago, Giorgio Borlenghi, a veteran Houston developer who built hundreds of highend units in Uptown, canceled a project he was planning to start in the Upper Kirby area. Other developers, however, have pressed on.
“Prices continue to go up in majority of my buildings,” Sudhoff said. “Demand is there. We keep selling.”
Through April of this year, buyers purchased 224 high-rise units at a median price of $305,000, according to data from the Houston Association of Realtors. That’s flat from 226 last year during the same time and down from the 257 sold in April 2017.
Contreras, president and chief executive of Houstonbased DC Partners, said construction will start in June and the tower will take about three years to build. He said he does not have a pre-sale minimum to meet before breaking ground.
The tower is being funded in part through the EB-5 investment program, which allows foreigners to receive green cards for themselves and their families if they invest at least $500,000 in a job-creating business in parts of the United States.
About 25 percent of the project’s equity came from EB-5 investors, said Contreras, who was born in Mexico and came to Houston in the mid-1980s. The U.S. subsidiary of Chinese investment firm Tianqing Group is also an investor.
HOK designed the tower and Abel Design Group and BeDesign were involved in the interiors. G.T. Leach is the general contractor.