As the story goes, it was on the eighth day that God created Texas. On the ninth day, Texans started bragging.
According to some, everything in Texas is bigger and better. While at one time many of these claims may have been just a lot of hot air, today the Lone Star state does indeed have some facts to back up its boasts.
The Texas economy, boosted by the shale oil revolution, is a shining star on the national level, outpacing the rest of the country in job growth and economic growth. Unemployment in the state is at a low 5.2 percent compared with the national average of 5.9 percent. In 2013 the state’s GDP represented 17 percent of the total U.S. GDP.
Of course, commercial real estate investors have taken note of the state’s economic boom and improving real estate fundamentals. In the annual Emerging Trends in Real Estate report produced by PwC and Urban Land Institute and based on a survey of more than 1,000 real estate experts, Houston was voted the number one major U.S. market for investment and development opportunities. Austin ranked second overall based on investment, development and home building prospects, and Dallas/Fort Worth ranked fifth overall.
However, it hasn’t always been days of wine and roses for the state of Texas. Those of us with a little more seasoning will remember the oil and gas booms and busts of the 1970s and 1980s. During the bust of the 1980s that sent the Texas economy plunging, locals had to endure their share of ribbing. For example:
- How do you make a small fortune in Texas oil? Start with a big one.
- What do you call a petroleum geologist? Hey, waiter!
- A Texas bank is giving away a toaster or an oil well if you open a new account. Everybody’s taking the toasters.
But that was then. While the oil and gas industry remains a major driver of growth, Texas now has a much more diverse economy that includes manufacturing, finance and technology. In 2013, for the 12th consecutive year, Texas was ranked the number one exporting state in the nation. A recent survey ranked Texas as the number one state in technology job growth. In an annual survey of CEOs conducted by Chief Executive magazine, Texas was rated the best state in which to do business for the 10th consecutive year. And the Milken Institute named Austin the best performing city — based on a number of criteria that measure economic success — in its annual ranking of metropolitan areas, and recognized Dallas and Houston in the top 10. Seven of the report’s top 25 best-performing cities in 2013 are in Texas.
As Texans are quick to point out, it’s not bragging if it’s true.
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Larry Gray is editorial director of Institutional Real Estate, Inc.
