CRE To CenterPoint After Highly Criticized Beryl Response: Learn From The Past, Fix The Infrastructure

Hurricane Beryl lashed the Houston area with much stronger winds than expected from a Category 1 hurricane. While surprising, it was nothing new for the area.

What was new was the crushing impact of days- and weekslong power outages and communications breakdowns that have many commercial real estate players calling for infrastructure improvements. And as one past storm showed, weather-related debacles can lead to positive change.

Tropical Storm Allison hit Houston in June 2001, dumping 37 inches of rain in 12 hours and leaving a devastating path of destruction and incalculable losses. In addition to killing 23 people and ravaging thousands of buildings, the storm flooded basements of Texas Medical Center’s hospital and research facilities, destroying 25 years of medical research data.

TMC suffered $6B worth of damage, but it jumped into action. Within two years, the center was protected at a 500-year flood level with the addition of backup generators and above-ground power distribution centers, hopefully ensuring it will never again suffer that level of damage.

Now Houstonians are hoping Beryl will teach the city's primary utility provider a similar infrastructure lesson. 

CRE players and politicians are anxiously waiting for CenterPoint Energy to jump into action to prevent another storm from leaving customers with prolonged power outages and a lack of information amid sweltering temperatures that shuttered workplaces and caused multiple CRE headaches. Heat-related deaths pushed Beryl’s death toll to 23 in the weeks after the storm. 

The outages from Beryl peaked at 2.6 million, or about 87% of CenterPoint customers, and Houstonians at first had no way to track them. CenterPoint’s regular power outage tracker had been down since the unexpected derecho on May 16 that caused close to a million outages.

The lack of information sharing was one of the primary things that CenterPoint didn’t do correctly, Texas Sen. Mayes Middleton said at a Bisnow event Thursday.

“A lot of it’s communication,” Middleton said. “We can take the bad news, but at least tell us.” 

The provider released an outage map about 36 hours after Beryl that sparked complaints of inaccuracy, though it and a more basic outage tracker provided much-desired information for those in the literal dark. Before that, many residents reportedly turned to the Whataburger app, which has a map of its 24-hour restaurants specifying whether they are open or closed, for power outage updates. 

A week after the storm, utility poles and power lines remained down or damaged, and hundreds of thousands of customers still lacked power. Two weeks after the storm, power was still being restored to the last unlucky 1,000-plus customers. 

“I’ve never gone this long without power anywhere,” Aspire Commercial Real Estate founder Brandon Avedikian said a week after the storm, when power in his office had yet to be restored.

Avedikian returned to the office on Thursday, 10 days after Beryl. 

There is blame to go around, Avedikian said. Local and state governments spent time sparring in the media in the days after the storm. But Avedikian zeroed in on the energy provider, whose response was “beyond unacceptable,” he said. 

“CenterPoint is to blame. … CenterPoint is a regulated monopoly with one job: to provide an essential resource,” Avedikian said. “It shouldn’t come as a surprise to anybody that Houston got hit with a hurricane.”

Hurricane season comes at the same time every year, Middleton said.

“When you don’t even have an outage tracker that allows you to see whether your meter is on or not, that’s your first sign there’s a problem,” he said. “They've not even had an outage tracker since May, since the derecho storm. Then, obviously, line maintenance has been an issue.”

CenterPoint leaders have said they prepared for the hurricane by coordinating with 2,500 utility crew members from outside the region before the storm and calling in another 10,000 after it hit, Houston Landing reported. Meteorologists and engineers told the outlet that storm preparation is complicated and many people were caught off guard by Beryl’s strength.

But Avedikian and many others are concerned about the rest of hurricane season, as CenterPoint won't be able to overhaul its infrastructure before it ends. National forecasters predict above-average hurricane activity this season, which lasts through November, due to factors including nearly record-high ocean temperatures. 

“There’s no quick fix to the inability to transmit electricity after some wind blows through,” Avedikian said.

Accompanied by the power outages were cell service issues, which limited residents’ ability to contact anyone and gather public safety information. 

Seth Eslami, chief operating officer of Stellar International Commercial Real Estate, said the day after the storm that he was frustrated with the cell service interruptions. During Hurricane Ike in 2009, Eslami was able to communicate just fine, even if he didn’t have power, he said. 

“Now, 16 years later, all of these technologies have improved, but I can’t communicate with my staff to see how they’re doing,” he said.

Not being able to access the news can put people in dangerous situations, Eslami said. Mayor John Whitmire asked everyone to stay home the day after the storm, but many people couldn’t access those messages, he said.

“A lot of people are going to get out just to try to find service,” Eslami said.

Cellular service providers told Chron that their service interruptions were tied to power outages, as many of their towers lost power. Cellular signals can also come from antennas on top of buildings. If the building loses power, so does that equipment, Robert Heath, a former adjunct professor at the University of Texas at Austin, told Houston Public Media. 

“The network can work even with fewer active towers, but then it becomes more likely that people will overload the connections,” Heath told the outlet. “There are backup network connections and backup power generators.” 

Academic and industrial research communities are studying how to better prepare for future weather events, Heath said. AT&T also has its own meteorologists and weather operations center, which helps it prepare.

“Not only were people in the dark with electricity, but we were in the dark with communication,” Bishop James Dixon said after community leaders met with CenterPoint CEO Jason Wells late last week, KHOU reported. 

During that meeting, Wells and other CenterPoint executives reportedly took responsibility for failing the community.

“Now they have to do something to show us that we won’t have this occur in the future,” U.S. Rep. Al Green said. 

Gov. Greg Abbott demanded CenterPoint send him a detailed plan by the end of the month about how it will prepare for future hurricanes this season. The plan must include preparing more linemen and workers and trimming trees that could fall on power lines, The Texas Tribune reported. 

If CenterPoint doesn't comply with this request, Abbott said he will issue an executive order imposing requirements on the company. 

Abbott also directed the Texas Public Utility Commission to launch an investigation into CenterPoint in the wake of the storm, adding that allegations of “penny-pinching and cutting corners” must be looked into. Abbott expects a PUC report in December, before the start of the next legislative session.

Lt. Gov. Dan Patrick formed a Senate committee to ensure utility companies “respond more effectively to future storms.” Middleton is part of that committee, and it will meet for the first time Monday, he said. 

If CenterPoint is unable to fix its ongoing problems, the state will reconsider the breadth of the territory it services, Abbott said, according to The Texas Tribune. Abbott also threatened to argue against CenterPoint recovering any profits if it fails to come up with a new plan for hurricane preparation.

“Will their response to the next storm be better?” Patrick asked on X.