Midway, owner of the onetime corporate headquarters of ConocoPhillips in Houston, has revealed its plans to transform the approximately 70-acre site into a premier mixed-use destination that will be known as Watermark District at Woodcreek.
The real estate investment and management firm will repurpose a portion of the property, which currently consists of 1.3 million square feet of office space, to create a walkable live-work-play enclave in the Energy Corridor.
Sited along Interstate 10 within the Woodcreek development in West Houston’s Katy Freeway West submarket, the former ConocoPhillips site was most recently known as Century Park, having been renamed by previous owner The Howard Hughes Corp. Howard Hughes had purchased the campus as part of a $565 million multi-asset transaction in 2020, and in late December 2021, the company sold the asset to Midway in a deal valued at only $25 million.
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Now Midway is prepared to give the onetime corporate headquarters a massive makeover that will yield luxury multifamily accommodations, high-end retail, a boutique hotel and most notable, 650,000 square feet of premier, future-oriented office space. The timing may be just right. According to a third quarter 2022 report by Holt Lunsford Commercial, “The Katy Freeway West submarket has not delivered any new office space since The Cannon delivered in 2019, and there is currently no office space under construction.”
Developed for Conoco in 1978, the Kevin Roche-designed compound that will evolve into Watermark encompasses 16 three-story office pavilions linked via bridges that create a walkway over ponds and grassy areas in an atmosphere reminiscent of a Japanese fishing village. Midway endeavors to transform the site into an environment that will serve as a magnet for cutting-edge companies to the city’s Energy Corridor.
In addition to converting a portion of the existing buildings into Class A office space, Midway will deliver a repurposed innovation hub and update the property’s 100,000-square-foot wellness/fitness facility. The changes will supplement the site’s existing health-centric offerings, which include walking paths, bike paths and access to a 12.5-mile network of trails.
In the process of bringing Watermark to life, Midway will preserve the history of the land while simultaneously minimizing the carbon impact through the adaptive reuse of a segment of the existing square footage. To further the greening of the compound, Midway has formed a partnership with cleantech social impact company 374Water to install a first-of-its-kind onsite, fully integrated sustainable wastewater management system.
And in its bid to urbanize the suburban setting, Midway will incorporate a new urban grid system that will enhance connectivity within the enclave and highlight its 9 acres of lakes and 20 acres of green space.
State of the Houston office market
The Energy Corridor in the Katy Freeway West submarket—home to such big names in the energy business as Shell, British Petroleum and ConocoPhillips, as well as other energy-related companies—has seen its office sector suffer the ramifications of the pandemic and the downturn in the energy sector, as evidenced by a vacancy rate that continues to hover in the low 20 percent range, according to the Holt Lunsford report. However, there have been positive signs in the submarket and across Houston.
“This submarket, along with most of the metro, has experienced a recent and significant flight-to-quality helping these large corporations to continue attracting a talented workforce,” according to the Holt Lunsford report. “Despite the lack of success in recent years, the submarket is easily accessible for a majority of the Houston workforce that resides in West Houston, making it an ideal location for companies looking to get out of the city and into the suburbs.”
Midway expects to kick off construction at Watermark in the first half of 2023.