McAllen Economic Development Corporation

Small Cities Are Becoming New Engine of Economic Growth

The conventional wisdom is that the world’s largest cities are going to be the primary drivers of economic growth and innovation. Even slums, according to a fawning article in National Geographic, represent “examples of urban vitality, not blight.” In America, it is commonly maintained by pundits that “megaregions” anchored by dense urban cores will dominate the future……

Complete FORBES Article

Methodology

Forbes ranked all 398 current metropolitan statistical areas based on employment data from the Bureau of Labor Statistics from November 2000 through January 2012. Rankings are based on recent growth trends, mid-term growth, long-term growth and the region’s momentum. Forbes also broke down rankings by size since regional economies differ markedly due to their scale. For the mid-size cities list, Forbes ranked the 91 MSAs that each have employment rolls between 150,000 and 450,000.

McAllen’s Placement in FORBES

Despite the housing bust and the recession, these 10 U.S. cities still managed to record population gains of 30% or more in the decade ending in 2010, according to the Census Bureau. The national average was less than 10% during that time.

McAllen, TX came in at #7, but it definitely displayed a healthy variety of reasons for it’s consistent growth. A strategic geographic location, tariff-free trade agreements between Mexico and  the U.S., an educated labor force, and  a cost of living about 17% below Dallas, 38% below Chicago and 54% less than New York, make this area a haven for manufacturers, retailers and recent graduates.

Complete CNNMoney Article

Exports from McAllen reached $4.5 billion in 2010, an increase of $1.4 billion since 2005, according to the latest trade statistics from the International Trade Administration. While McAllen ranks as the seventh-largest exports market in Texas — and 50th-largest nationwide — economic development officials say it is poised for future growth.

The McAllen metro area is one of the country’s leading exporters of computer and electronic products — at $2.3 billion, ranked 20th nationally — and also fared well in exporting electrical equipment and appliances.

READ FULL “The Monitor” ARTICLE

Preparing roles of napkins so they can be shipped out around the United States.

McALLEN — The invitation list to Saturday’s spring picnic for U.S-Mexico manufacturing managers bears no comparison to the first occurrence organized by the McAllen Economic Development Corp.

A few dozen people attended the first picnic held in 1988 at Hidalgo’s Lake Texano, a small affair where MEDC employees cleaned up the park and cooked the barbecue. For Saturday’s 25th annual iteration, event organizers had to prepare food and entertainment for some 3,300 people, a growth rate that largely parallels the region’s manufacturing sector.

COMPLETE ARTICLE

MEDC, INDEX & Friends

The skilled labor found in the McAllen/Reynosa Region allows companies like LG Electronics set up and grow in our area.

Who is McAllen Economic Development Corporation?

What does McAllen Economic Development Corporation do?

Where does McAllen Economic Development Corporation do what it does?

If you can’t answer any ONE of these questions, or worse yet, ANY AT ALL, you may not be alone, especially if you are not involved with the industrial community. However, keeping up with McAllen Economic Development Corporation has been known to benefit those who do so.

The truth of the matter is that McAllen EDC has been doing what it does for over 24 years. As a nonprofit organization contracted by the City of McAllen, McAllen EDC’s main purpose is to recruit businesses into McAllen and Reynosa, Mexico in order to create jobs for our community, and improve overall quality of life.

Over time, the types of businesses that McAllen EDC has been primarily working with are industrial manufacturers, suppliers and call centers. Companies like Panasonic, Motorola, Bissell, Sharp, Alps Automotive, T-Mobile, are just a few that have relocated or expanded into the McAllen/Reynosa region. So again, what does McAllen EDC do? What role does it play in bringing these companies down?

Simply put, McAllen EDC calls on these companies’ corporate offices around the globe and promotes the unique resources that the McAllen/Reynosa region offers any company looking to compete in today’s volatile business world.

First, McAllen EDC works from within our community to build these resources. Developing relationships and working together with McAllen ISD, South Texas College, University of Texas Pan American, Workforce Solutions, City of McAllen, the State of Texas Governor’s Office, City of Reynosa, the State of Tamaulipas, real estate developers and brokers, and retailers and hospitality groups, as well as utility companies and TXDot, have allowed companies to view our area as a true pro-business bi-national community willing and able to support any industry looking to invest.

Once McAllen EDC is able to spark a genuine interest from prospects, site tours are scheduled for these prospects to visit the McAllen/Reynosa region and study it as a potential site for their operation. McAllen EDC has to be able to show everything from a qualified labor force, to adequate buildings or land sites for construction, to efficient transportation routes and infrastructure for these companies to bring in their raw materials and ship out their finished product to their clients. In addition, McAllen EDC must prepare a competitive relocation or expansion incentives package in order for the prospect to choose the McAllen/Reynosa region and create new employment opportunities, rather than losing that prospect to other communities. This is where strong relationships with city and state governments make all the difference.

As a prospect transitions into a committed operation, McAllen EDC also assists these companies throughout their relocation or expansions by putting them in contact with local businesses or professionals like residential real estate brokers, accountants, doctors, hotels, restaurants, airports, etc. This is where we begin to see the positive economic impact that these companies bear on our community.

Surprisingly, not all is said and done once a company settles in the McAllen/Reynosa region. McAllen EDC visits with those same companies periodically to ensure that their operation is running smoothly and provides them with any assistance they require in order to stay in our community and grow even more. Again, McAllen EDC’s goal is to create jobs for our community. McAllen EDC’s best interests lie in providing our community with rewarding employment opportunities and a superior quality of life.
Over the last 24 years, McAllen EDC has recruited over 635 companies that have created over 137,615 jobs in the McAllen/Reynosa region. Through carefully targeted marketing and promotional campaigns, McAllen EDC has been able to reach out to companies worldwide.

However, the people in our community (YOU) can also assist McAllen EDC in its continued efforts to bring more companies to our region by referring new businesses. McAllen EDC has created a “Rewards for Referrals” program to provide you with an incentive to make referrals. For more information regarding Rewards for Referrals, South Texas Job Zone (an employment opportunity website), and to follow McAllen EDC on Social Media, go to our website: www.mcallenedc.org

The state of advanced manufacturing in South Texas was the focus of a White House Business Roundtable held Feb. 16 at The University of Texas-Pan American.

Juan “J.D.” Salinas, regional administrator for the General Service Administration’s southwest region, requested the meeting with members of the core leadership team of the North American Advanced Manufacturing Research & Education Initiative (NAAMREI), which includes several UTPA representatives, to obtain input from the region to help advance the Obama administration’s Advanced Manufacturing Partnership (AMP) launched last year.

Complete UTPA Article

China has experienced sporadic labor shortages, which in turn have driven up its once rock-bottom labor costs. This trend is particularly evident in the weeks following China’s Spring Festival, or New Year, when more than 100 million rural migrants return to the countryside to spend the year’s biggest holiday with family. Coaxing those same migrants back into the urban work force has proven increasingly difficult.

Complete NEW YORK TIMES Article

As the McAllen/Reynosa commercial and industrial markets have continued to provide activity from both existing and new companies, CBRE Group, Inc., a Fortune 500 real estate firm, has announced that it will open an office in McAllen to serve this binational area. It further announced that this office will welcome the addition of Brokerage Associate Carlos Marquez.

During his 10 years in the commercial real estate business, Mr. Marquez has focused on the commercial and industrial real estate markets in South Texas and Northeast Mexico. In his role at CBRE, he will work on both sides of the U.S./Mexico border on a variety of assignments, from industrial sales and leasing to land dispositions.
“This is an exciting time to be joining CBRE,” said Marquez. “With the platform, infrastructure and support that CBRE provides, I see this new role as a great opportunity to enhance the company’s offer to clients on major leasing and development projects in the Rio Grande Valley and Northeast Mexico.”

Marquez said he had been thinking about the move for a while, and came to the conclusion that now was the most opportune time in the market cycle to join the dynamic team at CBRE.

“Joining CBRE’s capabilities with the pro-business environment this region offers will benefit all parties involved tremendously,” said Marquez.

The new McAllen office will fall under management of the El Paso office of CBRE, led by Christian Perez Giese, Senior Vice President.

“Over the past two years, CBRE has been working on strengthening our business along the U.S./Mexico border,” said Giese. “With the addition of Carlos Marquez in McAllen we have filled the last gap in our regional coverage and brought an experienced commercial broker on to our team. We are excited to grow our platform in this market around Carlos with support from experienced CBRE brokers that have been working in this area for many years.”

As the McAllen MSA industrial market finalizes 2011, the year’s activity continues to support the area as an attractive location for growth. While 2009 and 2010 recorded 70,000 and over 400,000 square feet of net absorption respectively, 2011 closes the year with over 730,000 square feet of positive net absorption. Based on McAllen’s historical net absorption, 2011 posted figures close to those of its peak year, 2005.

Similarly, the creation of jobs in McAllen also outperformed the historical average. In 2011, the expansions of 12 existing companies committed 469 jobs, while 11 new companies setting up their operation in the McAllen MSA committed 770 new jobs. Total job creation for 2011 was 1,239, while the historical job creation figure is 1,094.

With 23 transactions ranging from 5,000 to over 220,000 square feet in size, vacancy rate positioned itself at 9.2 percent, a 120 basis point decrease from the 10.4 percent it displayed in 2010. This is the first time vacancy rate is under 10 percent since 2007.

The market generated over 1.1 million square feet of gross absorption for the year, while the consumption of existing inventory and construction of build-to-suit facilities was evenly distributed at 50 percent.

The submarket which displayed the most absorption through leasing was McAllen, with almost 325,000 square feet. The average lease measured 35,000 square feet, but Steelcase led the leasing efforts when it occupied 64,000 square feet in Sharyland Business Park to serve as its U.S. distribution center. The Edinburg submarket displayed the largest activity in build-to-suit projects with over 340,000 square feet of newly delivered space. Don Hugo Produce amassed the bulk of that total with over 225,000 square feet of cold storage space in the RGV Produce Park.

Although activity caused vacancy to be under 10 percent for the first time since 2007, the McAllen MSA still displays over 1.7 million square feet of vacant space. With a healthy mix of class A first generation buildings, class B second generation inventory, and fully  infrastructured industrial land, this market maintains itself as a premier destination for new and existing manufacturing or warehousing operations.

As anticipated in 2010, the Reynosa industrial market saw many existing operations continue to expand and increase total market size. In 2011, the market experienced a growth of over half a million square feet, leaving total market size at 29.6 million square feet. Although 2010 proved to be a year of recovery from the dismal activity and negative absorption figures seen in 2009, this year saw significant improvements in net and gross absorption, as well as vacancy rate.

As a total of 26 companies either expanded their existing operations or created new divisions altogether, a net absorption figure of over 850,000 square feet easily surpassed the 597,000 square feet posted in 2010. Gross absorption also exhibited over 2.1 million square feet of total positive transactions, surpassing the 1.7 million square feet from last year. Furthermore, for the first time since 2008, vacancy rate was under 10 percent at 9.6 percent. This was a 150 basis point decrease from the 11.1 percent posted in 2010.

The creation of jobs also saw an increase of over 43 percent from 2010. Expansions from existing operations provided the market with 5,150 jobs, while new operations generated 1,200 employment opportunities. In total, Reynosa transactions contributed to 6,350 jobs, while the historical job creation average is 4,950.

Growth recorded by existing operations in Reynosa averaged over 82,000 square feet in size. While the East submarket traditionally hosted the bulk of transactions, 2011 saw the West submarket take the lead in positive absorption with over 1 million square feet. Corning Cable Systems, a telecommunications equipment manufacturer, absorbed the largest space in the
entire market with their lease of a 280,000 square foot facility in Villa Florida Industrial Park. On the other side of town, the East submarket posted over 940,000 square feet in positive absorption. Gear for Sports, an apparel operation, recorded a significant transaction with the construction of their 170,000 square foot expansion in Reynosa Industrial Park.

As Reynosa continues to provide immediate solutions for the expansion needs of its established operations, over 2.8 million square feet remain vacant. With an abundant source of high-skilled and low-cost labor as well as an established pool of manufacturing suppliers, Reynosa remains an extremely viable option for new operations considering growth into an industrial-oriented market.