The future looks so bright for Greater Waco, builders, bankers, economists and real estate agents may have to wear shades in 2018.
True, the number of people employed locally has declined in recent months, says the Texas Workforce Commission, but those figures could change — either due to a TWC recalculation or because Waco ranks “in the top two or three” on the lists of several industrial prospects pursuing sites.
Nail guns, power saws and those who use them should get a workout next year, as progress continues on the 1,500-lot Park Meadows subdivision off Ritchie Road, and work ramps up on Creekside, a 750-home project near West Warren Street and Ritchie Road that will involve a handful of local builders, including veterans Fred Dewald and Richard Clark.
“Then there is Callan Village, planned along Ritchie Road between Panther Way and Chapel Road and offering 475 lots, I believe,” said Clint Peters, Waco’s planning director. “And Ken Cooper, who developed Hidden Valley, wants to build west of McGregor Airport. He’s in preliminary design.”
“Build-out will take place in several existing subdivisions, including Hidden Valley, Twin Rivers and Sun West, all of which have been around a long time,” said Peters. “Our hottest areas remain China Spring, the Highway 84 corridor and Ritchie Road. A lot of building is going on out there.”
The inventory is sorely needed, said Camille Johnson, a 32-year veteran of the residential real estate scene who specializes in upscale properties.
“This was my best year ever. I’ve had some good ones, but this was my best by far. A lot of agents probably feel the same way. We just need more houses, more affordable housing,” Johnson said. “Take homes in the $150,000 to $350,000 range. There is not much supply at all. If a property is priced right, it will sell immediately. I recently listed a home just off Lake Air Drive, asking $209,900. I had 24 showings in two days, and multiple offers. It was like the Keystone Cops, so much coming and going.”
Johnson said Multiple Listing Service recorded 5,956 residential-related transactions locally through mid-December, with a value of $1.46 billion.
Some agents say they know of homes selling so rapidly they never appear on the MLS listing, meaning the tally could be greater.
“I think that is amazing, and I don’t see much changing in 2018,” Johnson said. “The local economy is good, jobs are stable. Waco is becoming a cool place to live. Professionals are relocating to this area, out-of-town investors are looking, and young couples are moving up or moving around, some of them buying their first home.”
Waco-based economist Ray Perryman, who has a national reputation, has said Waco is “the next great city in Texas.” He responded to a request for comment with an email, stating, “I think that Waco definitely has a great opportunity to emerge as a major growth center in the future.”
He said an analysis by The Perryman Group focused on infrastructure improvements by the city of Waco, “which clearly provide the capacity to sustain future expansion.” He said the city stands to gain residents wanting to escape the explosive growth and congestion now found in its larger neighbors on Interstate 35, Dallas/Fort Worth and Austin.
Perryman said downtown and riverfront development, as well as “tourism engendered by the Magnolia complex,” is creating more opportunities.
Combine Baylor University, McLennan Community College and Texas State Technical College “with a growing national profile,” and Waco has potential for job growth “that has not been fully exploited,” Perryman said.
Realtor Gregg Glime, a commercial and industrial specialist, said he is working with two industrial clients considering placing new plants in Waco, and with at least one local prospect wanting to expand.
“One would create 200 jobs almost immediately, another, about 200 jobs long-term,” said Glime, speaking by phone. “Commercial remains strong, and all indicators are pointing in the right direction. Tax reform, I’m hearing positive response to that, and we have a lot of rooftops on the way. We have enough development in the pipeline to stay positive.”
Glime said he represents a group of local investors planning to take advantage of Greater Waco’s momentum by placing an 80,000-square-foot mixed-use development at U.S. Highway 84 and Ritchie Road that would include restaurants, office/condominium space, an amphitheater, ponds and a walking area. Called The Outlook at Bosque Ridge, it would target homeowners flocking to the area, Glime said.
Meanwhile, Glime said the proposed Jackson Station planned at Eighth Street and Jackson Avenue has reached the city permitting stage. Work will begin in 2018 to create space there for a microbrewery and a “destination-style” restaurant, and Glime has begun preparing a list of names.
“I’m also working with a full-service hotel interested in a 4-to-5-acre site downtown. This is one that has not gone public with its intentions,” said Glime, who mentioned that progress continues on developer Shane Turner’s Union Hall food court taking shape at Eight Street and Franklin Avenue, and Mary Avenue Market “is doing really well.”
In Waco’s industrial district, Allergan, a pharmaceutical giant that makes eyecare products locally, should begin construction in 2018 on a 322,000-square-foot, $200 million expansion that would add 100 jobs immediately and an estimated 300 more when production peaks.
Real estate agent Jim Peevey, also a commercial specialist, said his pipeline and that of his colleagues at The Reid-Peevey Company includes “retailers, office space, multi-family development and land sales.”
“One component this market does not have is a big entertainment complex,” Peevey said, adding that may change as fellow agent Pat Farrar is marketing a 34-acre site near Interstate 35 and Sun Valley Boulevard that could prove ideal for a “movie-house concept.”
Mark Reynolds, a regional president for Extraco Banks and chairman of the Greater Waco Chamber of Commerce, said the community is aware it needs to keep young talent in Waco, that it must curtail the brain drain of the best and brightest leaving the city for Dallas and Austin.
To that end, he said, local stakeholders are planning to unveil “Start-Up Waco,” with the goal of providing training, mentoring and venture capital funding to those wanting to pursue their dreams locally.
“This will take a collective effort that involves business, education, government and foundations,” said Reynolds in a phone interview. “We hope to build our own entrepreneurial eco-system, and we plan to begin making announcements shortly after the first of the year.”
The bottom line, said Reynolds, is creating jobs and generating tax revenue to support a community that will double in size by 2040.
American Bank president David Hicks said he predicts “a reasonably good economic year in Waco in 2018,” but he does have concerns.
He sees the Federal Reserve raising interest rates, but not much, and he wonders how business growth and the construction industry will react, “since they’ve operated in a low-interest-rate environment for so long.”
Housing and construction costs have risen 20 to 25 percent over three years, in part due to the surging price of materials, a situation Hicks described as “beyond ridiculous, in some cases.”
He said the double whammy of higher prices and interest rates “may prevent buyers from acquiring the home they want.”
“Guys in construction already are complaining about cost overruns, the price-per-foot going up,” Hicks added. “That being said, Waco is still more affordable than many parts of the country.”