In a summer filled with heart wrenching floods and rising lake levels across large swaths of Texas, the idea of a water shortage seems far-fetched. The reality is many cities in Texas are forced to grapple with water shortages daily. While there may be enough water supply to address the needs of residents and businesses today, what about future capacity as developers consider new projects?

Conroe Development Pause

The issue of water supply and water infrastructure has come to the forefront for the city of Conroe. Conroe has nearly doubled in size since 2010, but water capacity has not kept pace with the growth. As a result, in August 2024, Conroe put the brakes on certain development in the northern part of the city.

In an article from ABC 13 in Houston, Conroe’s city administrator discusses having to deny permits for pools submitted by homeowners and hotels. The permit pause impacted everyone from homeowners to builders to developers, both residential and commercial.

While the moratorium may not have been extended, the consideration of available water still remains on the table though permitting and development.

Developer Considerations

Developers need to spend extra time on their pre-purchase diligence to ensure that water will be available for a planned project and consider the possibility they may be forced to fund and build water resources themselves. Creating the infrastructure where water is available is very costly and will affect the price of rooftops.

It will be crucial in the years ahead for developers to work closely with their attorneys before and after land acquisition to ensure municipalities are able to issue permits for water and, if not, the options that may be available to keep development projects on track.