The Waco economy stumbled from the gate this year, with home construction and employment numbers falling and home prices turning sluggish in January, according to a report prepared by Amarillo-based economist Karr Ingham.
Ingham said home and vehicle sales and general spending helped rescue the Greater Waco Economic Index, though its raw score slipped from 126.0 in December to 125.7 in January. Still, it was fractionally higher than the grade in January of last year.
Ingham uses data dating to 2000 to prepares a monthly snapshot of economic indicators for the First National Bank of Central Texas and the Tribune-Herald.
Inflation-adjusted spending in January increased a “respectable” 2.9 percent from the same month last year based on sales tax receipts in Bellmead, Beverly Hills, Hewitt, Lacy Lakeview, Lorena, McGregor, Robinson, Waco, West and Woodway, Ingham said. The area is coming off a year in which consumers did not necessarily beat a path to the checkout lines, he said.
“Taxable spending in 2017 was generally weak, with annual growth of less than a percent,” Ingham said.
Business leaders met Thursday at First National Bank of Central Texas to hear Kris Collins, senior vice president for economic development at the Greater Waco Chamber of Commerce, present Ingham’s findings. Several people at the meeting mentioned retail and restaurant projects underway or on the drawing board that could improve sales tax revenues.
Triliji Group real estate agents Jimmy Banks and Lisa Monroe said they have secured permits for The Axis at Legends Crossing, a mixed-use center near Interstate 35 and State Highway 6. Monroe said negotiations continue with a food-related prospect “that would be new to this market.”
Banks said construction is progressing on a Cajun-themed restaurant called Walk-On’s, and a grand opening is likely by May. New Orleans Saints quarterback Drew Brees, a shareholder in the growing chain, reportedly hopes to attend the grand opening at Legends Crossing, Banks said.
Monroe said a Texas-based chain called Hat Creek Burger Co., which offers burgers, craft beer and party space, has committed to locating in The Colonnade, a 40-acre development on U.S. Highway 84 in Woodway.
A nearby 4.8-acre tract reportedly is under contract to a prospect who envisions a mixed use development with retail “and a medical office component,” Monroe said. She said she could not yet identify the potential user.
Payroll employment continues to founder locally, with the Texas Workforce Commission estimating 117,500 positions were filled during January, 1,000 fewer than the same month a year earlier in the Waco Metropolitan Statistical Area, which includes Falls and McLennan counties.
Ingham said he believes the Texas Workforce Commission may revise those numbers upward when it re-examines data. The Waco MSA jobless rate dipped to 3.8 percent in January from 4.2 percent in January a year earlier, the workforce commission reported.
Collins said she knows of several companies that are hiring, including the Tractor Supply distribution center, Dick’s Sporting Goods, which will open a store in Richland Mall, the Cargill poultry-processing plant, and Empereon, which operates a call center on North Loop 340 in Lacy Lakeview.
John Bible, an operations supervisor at Empereon, said in a phone interview the facility employs about 350 people who field inbound calls, “and we project getting up to 600 or 700 within two months.”
Vehicle spending totaled $53 million in January, a modest increase from a year ago. But Ingham said sales in January 2017 were 19 percent higher than those in January 2016. In that context, he said, “real auto spending is off to a solid start in 2018.”
Ted Teague, general manager of Allen Samuels Dodge Chrysler Jeep Ram on West Loop 340, said the Samuels-branded Fiat-Alfa Romeo store in Waco “will cease to exist.” Fiat will relocate to his site, Alfa will leave the Waco market, and the space they vacate will become a used-car superstore, Teague said.
A total of 135 single-family homes were sold in January, a 13 percent increase from the previous year, Ingham said. The average price of a home sold hit $167,063, a fractional increase from January a year earlier.
Collins said the leveling of home prices following robust increases during most of 2017 is a good sign.
“We don’t want price to outpace affordability,” she said.
Amanda Cunningham, a residential specialist with Coldwell Banker Jim Stewart Realtors, provided a report showing there were 664 active home listings locally during January, up from 539 a year earlier.
“I’m seeing a lot of buyers for homes in the $400,000 to $450,000 range, but inventory at that price is lacking,” Cunningham said.
The number of permits issued to build new homes dipped slightly in January, but remains almost 20 percent higher for the 12 months through January, Ingham said.
Also Thursday, Collins cited a report from the Small Business Development Center showing 2,846 businesses were launched in McLennan County last year, up from 2,146 the previous year. Statistics also show 12 ventures being started for every 1,000 residents of Waco, which is more than the 11-per-thousand statewide average and the seven-per-thousand nationwide average.
Megan Henderson, executive director of City Center Waco, said Chip and Joanna Gaines “have more plans up their sleeve for downtown,” and developer Shane Turner is continuing to make progress on expanding the Waco Hippodrome theater by three screens and is continuing to pursue tenants for his Union Station food hall at Eighth Street and Franklin Avenue.