Harry Masterson, Managing Partner, Ember Real Estate Investment & Development
Invest: sat down with Harry Masterson, managing partner of Ember Real Estate Investment & Development, to discuss Houston’s housing market, the evolution of master-planned communities, and the opportunities shaping the region’s growth. “The Houston market, and the Texas market more broadly, continues to march to its own drumbeat,” Masterson said.
What are the biggest changes in the Texas real estate market, and how are they affecting Ember’s business?
There are a lot of questions about the economy and the future of the housing market. There are mixed signals, but the Houston market, and the Texas market more broadly, continues to march to its own drumbeat. Even when things seem to slow down here, activity remains strong.
Everybody is wondering where interest rates are going, what is happening with oil prices, and other broader economic questions. However, the daily activity in Houston continues to be strong. People need houses. Home sales in The Grand Prairie have not slowed down, and we are still working hard to meet that demand.
Across the industry, there is some divergence in the market. There has been a push toward value-oriented products, which was expected. At the same time, the moderately higher end of the market has been stronger than many people anticipated.
How would you describe the investment environment for real estate development?
There are many different sectors within real estate. Anything that is heavily dependent on rent rolls is a more challenging area right now. Multifamily is difficult, and build-to-rent is also facing challenges. Those are still good sectors over the long term, but they are tougher areas to be in at the moment.
There is significant interest in residential development and for-sale housing products. Berkshire’s acquisition of Taylor Morrison was a major headline and a meaningful signal. Many people view that move as evidence that sophisticated investors remain confident in the long-term outlook for the U.S. housing market.
Land costs are expensive, and infrastructure development is expensive. Nevertheless, people want houses, so developers continue to find ways to make projects work. Home sales remain strong.
What gives Houston a competitive advantage, and what continues to attract people to the region?
Houston is a great place to live and work. It is an open environment. It is easy to come here, start a business, and, if you work hard, people are willing to do business with you.
Some cities are considered difficult to break into, but Houston has always been open for business. It continues to be that way today. The city government and Harris County seem to be working well together and creating an environment that is conducive to investment, both for employers and for housing development.
Where do you see the biggest infrastructure challenges facing the region?
There has been a great deal of attention on the new floodplain maps coming to Harris County, and that has generated concern among many people. However, the development community has largely been ahead of those changes. We already know what those maps are likely to look like, and we are developing to those standards today.
Despite some of the public concern and misunderstanding around the process, we are still able to deliver quality development projects. We are building in ways that not only address our own stormwater management needs but also help support older surrounding developments.
The other major challenge is cost. It costs a great deal of money to build roads, water plants, and sewer infrastructure. The approval process also takes longer than it historically has. Even though city and county governments are working to shorten those timelines, projects often become more expensive as the process extends. Those are real hurdles that the industry continues to face.
How are homebuyer preferences evolving?
As Houston continues to grow, development naturally moves farther away from downtown and other commercial centers. Houston historically delivers about 35,000 new homes annually in a normal, healthy market, and we have been exceeding that for years. That growth pushes development outward. As a result, traffic becomes more challenging, and buyers are increasingly looking for a stronger sense of community within master-planned developments. People are not simply buying a home on the prairie anymore.
There is still some of that, but there is much higher demand for communities that offer an integrated lifestyle. Those communities need cohesive recreational amenities, interconnected trail systems, and thoughtfully planned commercial components. Town squares and gathering places are important. A sense of identity is becoming increasingly valuable.
Interestingly, buyers are also willing to accept smaller homesites if they can gain access to the lifestyle they want. That represents a shift from the traditional idea of driving farther to obtain a larger property. It’s really becoming less about driving until you qualify and more about driving until you find the lifestyle that suits you.
How can developers balance quality amenities with housing attainability?
That is the million-dollar question, and it is something every developer is trying to solve.
In our communities, we focus on offering a blend of housing types. While we have premier builders creating lakefront homes that can exceed $1 million, the entry point into the community begins in the mid-$200,000 range. There is significantly more attainable housing than there is luxury housing.
Like any successful city or town, a community benefits from having a mix of products. The key is making sure those products relate well to one another and ensuring that amenities are appropriately sized and thoughtfully planned.
How significant are data centers and AI-related infrastructure opportunities for Texas?
There is a lot of discussion about data centers right now, and sometimes it is difficult to separate perception from reality. Personally, I have no problem with data centers. I think they are a critical component of the economy and a source of strength for Texas. They create significant taxable value, which benefits communities. While they do not employ large numbers of people once they are operational, they provide the infrastructure that supports so much of modern life. The services people rely on every day are increasingly data-driven.
I also think the industry is evolving. Newer data centers are focusing on closed-loop systems and reducing water consumption. Data center developers understand there are concerns, and they are responding to them.
Houston remains a place where business owners can invest and build projects successfully. I do not see major resistance to data centers here. Overall, I think they are positive for the regional economy.
What are Ember’s priorities over the next two to three years?
We plan to continue expanding our portfolio. We want our projects to become better, larger, and more impactful.
We also see opportunities to expand into industrial development and potentially retail. Those are logical next steps as we grow. Our partners have extensive industrial development experience in Mexico, which gives us strong capabilities and relationships to support larger-scale industrial projects in the future.
Is there anything else you would like readers to know about Ember?
Our current project, The Grand Prairie, has received a great deal of attention, and it has been an exciting development for us. From the beginning, our focus was simply to build a community we would be proud of, a place where we would want to live ourselves. That philosophy seems to have resonated with buyers. The project has reached the No. 4 position in Texas for home sales.
That ranking was never the goal. The goal was to create something thoughtful, unique, and different from the typical cookie-cutter development. We wanted people to visit and immediately recognize that it offered a distinct experience.
As a private company based in Houston, we are able to move quickly and make decisions without layers of bureaucracy. We do not have to work through multiple committees and approval structures for every decision. That flexibility is a competitive advantage, and we intend to continue taking advantage of it as we grow.
