$55B of Houston commercial space likely flooded by Harvey
Up to 27% of Houston's commercial real estate, representing a value of $55 billion, has likely experienced flooding due to Hurricane Harvey, according to commercial real estate research firm CoStar Group.
As many as 12,000 commercial properties across 400 million square feet, including multifamily, office, retail and industrial buildings, could be affected. Additionally, 72,000 apartments within the 100-year floodplain are likely submerged to some degree, with low- and moderate-income residents disproportionately affected.
Analysis by risk-modeling firm RMS put the regional price tag for Harvey-related damage as high as $90 billion, according to The Real Deal New York.
Houston is especially susceptible to flooding events due to rapid development in the area. Limited allowance for green infrastructure, especially, has left few avenues for flood waters to recede, The New York Times reported.
The area has long struggled with managing stormwater, according to the Associated Press, even before oil-related construction booms and current growth increased the pace of development there. The Federal Emergency Management Agency (FEMA) has paid more than $3 billion over the last two decades to cover flood damages in the Houston area, the AP reported. Some advocates attribute the hefty damages to inadequate zoning and land-use policies, which they say could otherwise help to mitigate the effects of heavy rain events.
Compounding flooding concerns is the fact that more than half of Houston's residential and commercial properties at high or moderate risk of flooding are not in FEMA's Special Flood Hazard Areas. Properties in these areas and with mortgages backed by federal dollars are required to carry flood insurance, which could indicate that many buildings currently under water have no coverage.
Just two weeks before Hurricane Harvey made landfall in Houston, President Donald Trump rolled back the Federal Flood Risk Management Standard that required federally funded construction in flood-prone areas to be built to higher resilience standards after a natural disaster like Harvey. That is one sign that the rebuilding process to mitigate future flooding in the area will be contentious.
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