Texas named leading state for commercial real estate development
Monday, May 7, 2012
Dallas Business Journal – by James Aldridge
Texas ranked first in the nation in the development and construction of office, industrial and retail space in 2011, according to a report issued by NAIOP Research Foundation.
Texas’ development accounted for $7.9 billion in spending and 150,101 jobs supported in 2011, according to the report “How Office, Industrial and Retail Development and Construction to the U.S. Economy in 2011.”
After Texas, New York ranked second with $6.5 billion in spending and 83,762 jobs supported; West Virginia ranked third with $5.9 billion in spending and 100,889 jobs supported; California ranked fourth with $4.5 billion in spending and 70,817 jobs supported; and Arizona ranked fifth with $4.2 billion in spending and 74,117 jobs supported.
This was the first year the commercial real estate industry posted gains nationwide since the recession began in 2007. The total economic impact of commercial real estate during 2011 added $261.6 billion to the Gross Domestic Product, compared to $231.7 billion in 2010. This is a 13 percent increase year-over-year.
U.S. construction spending on commercial real estate totaled $92.3 billion, a 12 percent increase over 2010. This spending supported nearly 2 million jobs nationally. These increases in construction spending and activity resulted in the building of 238.3 million square feet of new space, an increase of 2.5 percent from 2010. This new space has the capacity to house 610,000 jobs with an annual payroll of $26.8 billion.
“2011 was a transition year for the U.S. economy and the construction sector,” says the report’s author Stephen S. Fuller, economist and the director of the Center for Regional Analysis at the George Mason University . “The U.S. economy shifted from a federal-stimulus to private-sector driven growth pattern and construction spending grew accordingly.”
In addition to the advances made in 2011, forecasts for 2012 call for project construction spending to increase and to accelerate further in 2013 and 2014, according to the report.
“For the first time we are seeing across the board increases in this sector,” says Thomas J. Bisacquino, NAIOP president and CEO. “We believe this is the most solid evidence yet of a strengthening recovery.”
NAIOP, the Commercial Real Estate Development Association, is the leading organization for owners, developers and related professionals in the office, industrial, retail and mixed-use real estate sectors. NAIOP has 15,000 members across North America. The NAIOP Research Foundation was established in 2000 to provide research information on how real estate benefits communities across North America.