R AY ’ S
H O U S TO N Commercial Buzz RAY HANKAMER Hankamer & Assoc, Broker, Houston Contributing Writer
Patrick Jankowski, VP-Research Greater Houston Partnership
speaks to CCIM Chapter Luncheon: Economic Update Patrick Janowski
Jankowski summarized the economic roller coaster in the Houston Metro area since the end of the last peak, which was about 2008. He did it with (surprise!): numbers. • 354,200: The jobs created / long term average of job creation in area is 42-65,000 per year • 125,185: Metro area population growth, half organic (births minus deaths) and half from inward migration to our area • 6,177,035: Ten country metro population / the fifth most populous metro area in the country, chasing DFW (two out of five largest in US located in the Lone Star State) • $449.4 billion: Metro Gross Domestic Product • 2nd: Fastest growing metro economy behind San Francisco / Silicon Valley • 3.1%: Rate of job growth (now that we have returned to normal growth rate) • 231%: of jobs recovered since last recession-we have gotten back all jobs lost in recession and then some 30 REDNews.com
• $98: Market price for barrel of oil…if it drops below $70 exploration in Eagle Ford and elsewhere in US ceases to be economic • 87,635: Homes and condos sold in last 12 months • Sources of area growth: income growth, employment growth, population growth, plus pent-up demand after austerity of last recession • 352,721: Vehicles sold in last 12 months—indicator or confidence in future as people are willing to hitch up to monthly note payments stretching well into the future • We are “starting to see a slowdown” but it is only the growth curve slowing down to a more normal and sustainable growth rate
Other engines of Houston’s present and future growth are: • International trade-Panama Canal will not be a game-changer, since other Gulf Coast and East Coast ports, as well as Long Beach/Los Angeles port-rail interconnect will be competing for business
• Exports from Port of Houston have doubled in value 2006 -2013 • US overall economic growth creates demands for goods and services produced in Houston metro area • Rig count is down but this is deceptive, since new technology enables one rig to drill more wells • 50 million air passengers passing through Houston airports per year, and growing
Potential drags on growth: • Shortage of lots driving up housing and other construction costs • Shortage of qualified construction labor causing bottlenecks • Difficulty in tracking some employment indicators due to trend to not hire, but to engage “independent contractors” to do the same workthis negatively affects “employment” statistics and misrepresents number of people actually working in the economy