USA – TEXAS Law and Practice Contributed by: Taylor Cooksey, Philip Kinkaid, Serena Kramer and David Brooks, Cokinos | Young
Office Commercial office markets in Texas continue to undergo a dramatic shift as post-COVID work - place policies affect tenant demand. Office- using employment has increased by more than 500,000 jobs since 2020, but office use remains at two-thirds of pre-COVID levels. The impact varies across Texas’ local markets as well. While there has been a general shift toward more sub - urban office leasing, Austin and San Antonio have seen substantially higher rent increases in Class A+ and Class A buildings compared to Class B and Class C buildings, while Dallas has seen rents increase the most in Class A+ and Class C buildings, and rent increases in Houston have generally been the same across all building classes. Other The industrial real estate sector in Texas contin - ued its upward trajectory in 2024, with significant development of large-scale warehouses and ful - filment centres to serve the continued growth of e-commerce. Mixed-use developments con - tinue to become more popular in Texas’ major cities, and retail leasing has remained strong, with a shift toward more omni-channel retail that integrates online and offline shopping as well as experiential retail that focuses on more immer - sive in-store experiences. 1.3 Proposals for Reform The Texas Legislature is currently in session, and the following two real estate issues are high on
• reducing the minimum lot sizes that certain cities can require to increase housing density and affordability; • modifying zoning laws to permit the construc - tion of duplexes, townhouses and smaller apartments in areas zoned for single-family use or for commercial use; and • speeding up permits to convert commercial buildings into housing. Property Tax Reform Texas legislators are considering a package of bills intended to reduce the property taxes of school districts, which are responsible for the largest portion of most owners’ tax bills. Pas - sage will depend on agreement as to the portion of the state’s budget surplus that will be sent to school districts to replace such reduced prop - erty taxes. There are also efforts to enact a ban on the pur - chase of Texas real estate by governmental enti - ties of China, Iran, North Korea and Russia, by companies headquartered there, and possibly by individuals domiciled there. Similar efforts failed in the last legislative session, and it is unclear if the latest efforts will have any more success. 2. Sale and Purchase 2.1 Categories of Property Rights In Texas, real property rights include the follow - ing. Fee and Similar Estates • Fee simple absolute is the most complete form of ownership, granting the owner indefi - nite duration and the greatest control over real property.
the legislative agenda. Housing Affordability
There is bipartisan support for addressing the housing affordability crisis in Texas. Most leg - islative proposals currently under consideration focus on increasing the state’s housing inven - tory, by:
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