Building on experience
At 50 years, Moody Rambin rolls with the changes in Houston commercial real estate
At 50 years old, the Moody Rambin commercial real estate firm has outlasted some of its once cutting-edge developments. And as its founders ready to hand the reins to a new generation of leadership, the firm is creating new projects with an eye toward the future.
Founders Dan Moody Jr. and Howard Rambin launched the company in 1969, as patio homes were coming into vogue in Houston. The duo met through a mutual friend who had listened to them each talk about a desire to build zero lot line patio homes.
“We started off with three right at the entrance of the Houston Country Club,” said Rambin, a principal of the firm, from his seventh-floor offices on the West Loop near Post Oak Boulevard, overlooking many of the firm’s earliest developments. “We came back here and did River Hollow subdivision, and that was the end of that.”
The initial venture on the southwest corner of Potomac and Woodway Drive may have been profitable, but not by much, the partners said. So they turned to developing some Inner Loop land near Post Oak into the 50-unit River Hollow townhome subdivision, selling lots to builders in 1971.
“We wrote the deed restrictions and controlled what it looked like, but let other people build the houses,” recalled Moody, also a principal.
The area, just a few minutes away from two emerging office and mixed-use developments, seemed to be the perfect spot for a suburban office park as Houston’s growth continued to push outward from downtown. Nearby, Gerald Hines was developing the Galleria at Westheimer and Post Oak, and Kenneth Schnitzer’s Century Development was building Greenway Plaza along the Southwest Freeway near Edloe.
Moody Rambin secured 20 acres as the site of One Post Oak Place, a development consisting of seven low-slung atrium office buildings with indoor landscaping and natural light.
Atrium office buildings, which took off in Houston in the 1970s and persisted into the 1980s, gained in popularity because of their expanded lobbies with additional views beyond just a parking lot, according to Stephen Fox, and architectural historian with Rice University.
“It meant also you could generate higher rent because more space within the building had views, either to the outside or to the inside, because you had this vertical space,” Fox said.
Shifting tastes
The days of Moody Rambin’s early office developments near Loop 610 and San Felipe could be numbered, though, as dense developments continue to replace low-rise buildings. The company’s initial office building at 4615 Post Oak Place has since been replaced by a mid-rise apartment.
“Over time, they’ll probably all be gone because the deed restrictions are off now for the two- and three-story office height requirements,” Moody said. “So logic would be that it will get a little higher and better use, as in vertical.”
Moody, a Houston native and son of real estate developer Dan Moody Sr., worked as a land broker for his father’s firm, Moody Moody & Griffis, prior to teaming up with Rambin.
Rambin, who was born in New Orleans but bounced between Houston and Connecticut growing up because his father worked for Texaco, has lived in Houston since 1967 after graduating from Southern Methodist University and going to work as an accountant at a trucking company.
The introduction from the mutual friend led them to form a company called Patio Homes Inc. in 1969, which eventually became Moody Rambin. Now, the company’s leadership is transitioning to the new generation, led by Dan Moody III and Bob Cromwell, a managing partner who heads Moody Rambin’s leasing and brokerage business.
Other office park developments followed One Post Oak Place after the pivot to office from residential development, including Town & Country, Ashford Place and Sugar Creek Office Park in Sugar Land.
In total, Moody Rambin developed 24 suburban, low- and mid-rise office buildings before that line of business came to a halt in 1982. Demand for office space had begun to weaken in the late 1970s, and the Houston market became severely overbuilt in the 1980s, Rambin recalled. In 1986, oil prices plunged from $35 a barrel to $10 a barrel and office vacancy skyrocketed.
Adapting to changes
Moody Rambin adapted by shifting its focus to managing and leasing foreclosed proper
ties for institutional owners and other third parties. It has grown to become one of Houston’s largest commercial real estate brokerages, managing and leasing 10 million square feet in 2018. Over the last 30 years, the company has brokered some 13,000 deals, including a 1.2 millionsquare-foot deal for Shell Oil Co. in 1990.
Its suite of services has grown to include project leasing, tenant representation, disposition, development, consulting and management services to owners and tenants.
And while the company has developed 3 million square feet of retail, 2½ million square feet of industrial, 2,400 residential lots and recently half a million square feet of office space, Moody Rambin did not resume development until the 1990s with the redevelopment of the Town & Country Village shopping center.
That project, on 42 acres at the northeast corner of Memorial Drive and Beltway 8 in the Memorial neighborhood, now spans more than 2 million square feet, with scores of stores including Pottery Barn, Randalls, Ann Taylor, Frost Bank, Williams Sonoma and Escalante’s, to name a few.
The project, which had originally been developed in the late 1960s by Dan Moody Sr., has maintained a 95 percent occupancy since it was redeveloped in 1995.
“Still it’s that way today with a waiting list,” said Dan Moody III, managing partner of Moody Rambin’s development business. “Over time, the development will become more vertical. It will end up being a mixed-use project with office, retail and living all combined together.”
The area has emerged as a hub for jobs and entertainment. In 2004, Midway Cos. purchased Town & Country Mall, just north of Moody Rambin’s Town & Country Village development. Midway created the CityCentre urban district with a hotel, apartments and five office buildings, all surrounding Europeanstyle plazas and green spaces.
Moody Rambin’s 10-story building Town Centre I office building, on the southern edge of CityCentre, represents Town & Country Village’s first “vertical” component. The 250,000square-foot building, which has attracted a solid tenant based including Microsoft and UBS Wealth Management USA, is now 100-percent leased.
“We delivered in 2014 and met the oil correction,” said Cromwell. “That was a challenge.”
Staying current
Having amenities within walking distance for employees to dine and shop has been a huge plus, he said. The Town Centre II office building will be breaking ground soon next door.
Demand for new office buildings with best-in-class designs and amenities has remained brisk even as Houston’s office availability rate, including sublease space, has increased to 23.6 percent from a low of 14.8 percent this decade, according to commercial real estate firm Transwestern.
Since the energy crash of late 2014, new construction has generated 20 million square feet of positive absorption, according to Transwestern.
Some of Moody Rambin’s early buildings on the northern edge of CityCentre near Interstate 10 have been torn down to make way for Marathon Oil Corp.’s new headquarters under development by Hines. Marathon Oil will relocate from the Galleria area to be in a modern building closer to where its employees live.
While Moody Rambin has developed properties in other markets, its leasing and management and brokerage business is concentrated in Houston. One of its big current projects is the redevelopment of the Whole Foods-anchored Town Centre at Cedar Lodge in Baton Rouge, La.
Moody Rambin has grown to 110 employees with an average tenure of more than 15 years across three Houston offices.
Being an independent brokerage has kept Moody Rambin nimble.
“We can focus on our clients and not worry about our stock price and earnings and some of the issues larger, publicly-owned firms have to deal with,” Cromwell said.