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Mass timber buildings are becoming increasingly popular among major real estate developers, who find them leasing faster and commanding higher rents compared to traditional steel and concrete structures. At the National Association of Real Estate Editors conference in Austin, directors from Hines and Howard Hughes Holdings highlighted the advantages of mass timber, including lower construction costs and significant carbon savings.

Hines' Senior Managing Director, John Mooz, noted that the 100K SF T3 ATX Eastside building in Austin is already 47% leased despite high office vacancy rates, achieving rents comparable to prime office buildings. Howard Hughes' 49K SF One Bridgeland Green in Cypress, Texas, is 80% leased even before completion.

Mass timber construction, which involves gluing timber at high pressure to replace steel or concrete components, is becoming more cost-effective, now only 5% to 10% more expensive than conventional materials. The appeal of biophilic design and sustainability are key drivers of demand, as timber buildings typically emit 30% to 70% less carbon than their steel and concrete counterparts.

Despite challenges like insurance and fire risk perceptions, changes in building codes and improved certification systems for sustainable wood sourcing are helping to overcome these barriers, paving the way for broader adoption of mass timber in construction.

Original article posted on June 20, 2024