Shale Plays Fuel Manufacturing Growth

As many as 5 million manufacturing jobs could be added over the next eight years
Manufacturing Plant

Manufacturing Plant | Click to Enlarge

Shale plays are driving a surge in U.S. natural gas production. Production growth has pushed prices well below the peaks experienced in the 2000’s. Natural gas at less than $4/mmbtu, as of the end of 2012. Cheap fuel means cheaper energy, cheaper manufacturing, and cheaper products.

Natural gas or by products are used for heating, power generation, and as a feedstock in multiple chemical and manufacturing processes. A recent BCG study noted that rising factory productivity will boost U.S. exports and lead to the growth of as many as 5 million jobs. Five million jobs added to a workforce that measures approximately 150 million would be almost 3% growth from one sector of the economy. Add direct oil and gas jobs and you see why what we’re experiencing in the South Texas Job boom could translate to a widespread employment boom. [Read more…]

Industrial Space in Short Supply – Houston – San Antonio

Industrial properties are well occupied in Houston.  Energy Service (Oil & Gas) companies have quickly filled available space in order to meet demands from growing oil & gas plays like the Eagle Ford Shale.

Companies Are Expanding and Relocating to Houston

Many of my clients have chosen to remain (and even expand) in Houston as a primary hub, and then open up satellites in South Texas to take advantage of the Eagle Ford Shale Play in South Texas.  Given Houston is deemed as one of the energy capitals of the world, has a low cost of living and enjoys a quality labor pool, companies are oftentimes relocating to Houston.  Therefore, industrial space is being absorbed at a nice clip.  New development has started on 3 speculative projects for distribution space.  This hasn’t happened since 2007.  Also, over 2 MM SF of manufacturing space (buildings with cranes) is under development for both users and future occupiers.  Overall, we know of very little speculative projects underway in any other area of the country.  Notable companies expanding in Houston are National Oilwell Varco, Weatherford, and KBR. [Read more…]