Skanska USA buys key Montrose corner for $27 million

https://www.bizjournals.com/houston/news/2020/08/05/skanska-buys-retail-plaza-in-montrose.html

A Sweden-based developer has acquired a key retail plaza in Houston’s growing Montrose area with plans to convert it into a mix of retail and multifamily space.

Skanska paid $27 million to acquire the site, which is located at the southwest corner of Westheimer Road and Montrose Boulevard, according to a press release. The 2.86-acre site contains a 124,000-square-foot retail plaza, which is home to Half-Price Books, Mattress Firm, Spec’s Wine and Spirits, and Mattress Pro.

According to Harris County Appraisal District records, the property and buildings on the site had an appraised value of $13 million as of Jan. 1. An entity affiliated with Houston-based PM Realty Group has owned the property since June 2012, according to HCAD. PMRG was acquired by Washington, D.C.-based Madison Marquette in June 2018.

Skanska said the new project it is planning on the site is targeting LEED Platinum certification. Skanska did not provide additional details about that project.

“Montrose is the cultural heart and soul of the city. It illustrates Houston’s changing urban landscape and signals our ongoing commitment to the market,” said Matt Damborsky, executive vice president at Skanska USA Commercial Development in Houston. “Skanska is continuously looking for opportunities to diversify our Houston offerings while developing projects that reflect the strong culture and sense of community in this city.”

The property at the corner of Westheimer and Montrose has long been a target for developers looking to convert it to a mixed-use development.

When PM Realty Group acquired the property, it had similar plans to build a residential building with retail on the first floor, according to reports at the time.

But the company ran into opposition from some of the site’s existing tenants, who had long-term leases in place.

For Skanska, the acquisition of prime real estate in Montrose is just the latest in a series of splashy deals the company has done in Houston.

Last year, the company purchased four parking lots near Discovery Green for a planned mixed-use project that will include office, multifamily and retail space. Skanska paid $55 million for the four parcels, which total around 3.5 acres.

Skanska is also the developer behind the 35-story Bank of America Tower in downtown Houston.

In December, the company announced it had sold a 90% stake in the tower to an affiliate of Boston-based Beacon Capital Partners for $373 million.