Federal Reserve Bank of Texas Texas Economic Update: Texas Economy Finishes the Year Firing on All Cylinders December 2017


The Texas economy continues to expand at a steady pace as payroll employment rebounds strongly in the wake of Hurricane Harvey. The Texas Business Outlook Surveys suggest continued growth in the state’s manufacturing and service sectors. Early benchmark data for job growth in the first half of the year was revised down slightly from an annualized pace of 3.0 percent to 2.6 per-cent. When incorporating this data and adjusting for the hurricane effects, the Texas Employment Forecast projects 2.4 percent growth this year, slightly below the previous estimate of 2.6 percent. Job growth in 2018 is expected to stay on a similar pace and above the state’s long-term trend of 2.1 percent.

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Shopping and Shipping: Every Click of E-Commerce Drives Distribution Market


Industrial market expectations for distribution-style space as 2018 kicks off are a lot like what 2017 delivered: Escalating e-commerce volume and supply chain management practices that seek “last mile” proximity are driving demand and development, reports a sampling of Texas industrial experts.

Here’s why: Online shopping. E-commerce accounted for 25 percent of leasing in 2017, up from 14.7 percent a year ago, according to JLL’s “US Industrial Outlook 2017, 3Q.”

With leasing activity and absorption up, construction has followed. In both speculative and build-to-suit projects, the wide open spaces of Texas are now inside new properties; they’re super-sized and locating a bit farther out of established markets to optimize investment, bypass congestion as urban density rises, and participate in the “last mile” delivery concept that is defining the logistics of quickly moving and efficiently storing goods. Infill locations –with adequate truck parking –is also seeing some activity.

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Opening up office in 2018


When it opens its doors in 2019, Skanska’s Capitol Tower will reach 35 stories into the downtown Houston skyline, offering up 775,000 square feet of Class-A office and retail space. Six and a half floors of the sustainable building, totalling 210,000 square feet, will be occupied by Bank of America.
“That was by far the most unique deal I worked on in 2017,” says Kristen Rabel, senior vice president of CBRE Houston. “It was exciting to work with a large tenant and get them to understand the vision of Capitol Tower.”

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