Choosing the top 10 business stories of 2017 was no easy task. Where to start?
So many topics from which to choose: Magnolia Market; Twin Peaks/Scotty’s Brewhouse; gas prices after Hurricane Harvey; Hecho en Waco; Pura Vida; Waco Running Company; solar farms; Cabela’s/Bass Pro Shops; Aldi; sale of Coldwell Banker Jim Stewart Realtors; downtown attracts American Bank, ARC Abatement, TFNB Your Bank For Life and Walker & Associates; Premium ER; new pediatric ER at Providence; food trucks; food hall; Shane Turner; old Chili’s, new tenant; Manny’s, Michna’s, Hastings and Gander Mountain sit idle; ALICO gets roofs; Walmart/H-E-B curbside grocery delivery; new Walmart for Hewitt; 70-plus percent hotel occupancy; Milo Biscuit Company; extra screens for Hippodrome; TIF money flows; the Delaney at Lake Waco; Washington Avenue booms; the “green” building; more toasts for Balcones; Volkswagen still looking; Half-Price Books; Urban REAP; sales taxes/property taxes; tourists, trolleys and helicopter rides; SpaceX rocks; and the riverwalk rolls.
This list just scratches the surface. The following is our choice for best of the best. Feel free to compile a ranking of your own.
1. Housing market simmers
For a couple of years, veteran real estate agents have looked upon the local housing market with awe. They’ve seen nothing quite like it.
Homes sell in days, hours, even before they appear on the local Multiple Listing Service. Sellers receive multiple offers, some larger than their original asking price. For a time in 2017, homes changing hands were fetching more than $200,000 on average, a trend heretofore bordering on ridiculous. Trammell Kelly, a residential sales specialist at Kelly Realtors, said by phone he was sprinting to seal deals as Christmas approached.
Typically, ‘tis the season when buyers and sellers toss out the “Do not disturb” sign, but nothing about today’s housing market is holding to form.
The market cooled somewhat after mid-year, but ended with a bang. Home sales during November surpassed 200 for the first time ever, hitting 222, according to Amarillo-based economist Karr Ingham, who crunches numbers for the First National Bank of Central Texas and the Tribune-Herald. That represents an increase of more than 20 percent from November of last year, Ingham said in his most recent report.
On the home construction side, the number of permits issued to build new homes was up 40 percent in November and is running 22 percent ahead of 2016. The 448 permits issued through last month “is the highest since the record totals achieved in 2005-2006,” Ingham said.
Scott Bland, president of the Heart of Texas Builders Association, said he expects a banner year for builders in 2018. New subdivisions and additions to existing ones are in the works to meet pent-up demand that dwindling inventory has aggravated, the builder said by phone.
“For us in the construction industry, this is the new normal,” he said. “Inventory is so low that it would take half-a-year to a full year of significantly lower demand for inventory to return to acceptable levels. Fortunately, lot availability is improving, and we will see more homes coming out of the ground in 2018 than in 2017.”
This trend should stabilize home prices, but not necessarily exert downward pressure on them, said Bland, noting that the Waco housing construction market still enjoys a lower price per square foot than nearby Temple and Killeen, or in comparably sized Bryan-College Station.
Park Meadows, the sprawling 1,500-lot subdivision in far West Waco being developed by Texas-based heavyweights D.R. Horton and Stylecraft, will lead the way in creating options for seekers of new homes, Bland said, but veteran local builders Fred Dewald and Ricky Clark, among others, are unveiling projects that should serve as attractive complements.
“We’re excited about 2018. It should be a lot of fun,” Bland said.
2. L3 plant faces challenges
The L3 Technologies aircraft modification facility in Waco suffered more layoffs in 2017, continuing a trend that has seen staffing at the city’s largest industrial employer slide from a peak of nearly 1,800 to about 1,300, according to information it provided to secure a $1.25 million tax break from the state to make facility and equipment upgrades.
L3’s most recent round of local cuts came in September, when the New York-based contractor announced it was issuing pink slips to 124 staffers after a round of voluntary “separations” in Waco and Greenville. Waco operations are part of L3’s Aerospace Systems unit, which is not performing as well as other areas, according to company financial releases.
Already, L3 has begun streamlining, with the announced intention of focusing more on its more profitable units. It will sell Vertex Aerospace, a company within Aerospace Systems, due to a “major contract loss” earlier this year, according to the trade magazine “Inside Defense.”
Still, Kris Collins, an industry recruiter with the Greater Waco Chamber of Commerce, said she has heard nothing to suggest L3 is poised to pull the plug on Waco. Some industry observers, meanwhile, say L3 will join other defense contractors in seeing more work due to President Trump’s vow to increase military spending, as well as congressional support for a $700 billion defense bill even larger than one Trump proposed.
3. Legends Crossing’s new restaurants
The upscale Legends Crossing development at West Loop 340 and Interstate 35 is, at last, meeting the lofty expectations of local real estate agents Jimmy Banks and Lisa Monroe. They announced in 2017 that P.F. Chang’s, which specializes in Asian fare, and Walk-On’s Bistreaux and Bar, a Cajun-themed chain, have taken lots there and plan openings in 2018.
Elsewhere at the Crossing, Jay Hinojosa has sold the second home of his Heitmiller Steakhouse to Houston-based Los Cucos Mexican Cafe, which will open its 23rd location after a touch of remodeling.
Monroe and Banks have secured permits to erect in Legends Crossing a retail strip and headquarters for their Trilliji Group real estate office.
4. Richland Mall sees good, bad trends
Dick’s Sporting Goods, the industry leader, announced it would place a 45,000-square-foot store in Waco’s only enclosed shopping center. It will open in March with its own outside entrance, creating a new look for the property at Waco Drive and State Highway 6.
But the white elephant in the 697,000-square-foot mall remains the Sears store, an anchor since Richland arrived in 1980. Red ink is gushing from the iconic retailer, which continues to borrow and shutter stores in hopes of remaining viable. But even executives at Sears Holdings have wondered out loud if the Chicago-based giant has breathed its last.
“I’m not ready to lose Sears yet,” said mall manager Kandace Menning, speaking by phone. But she acknowledged that Richland Mall’s corporate parent, CBL Properties, already is playing the “what-if” game in other markets where its malls include a Sears presence.
Also, Richland Mall apparently is on the market, as Matthews Investment Services has tendered an offer to “qualified buyers” that appears on LoopNet, a real estate listing site. CBL denies it wants to part with the property, but Menning said “any piece of real estate is for sale at the right price,” though she did not know what the mall, with its occupancy rate of more than 95 percent, might fetch from investors.
5. Banking district created, sort of
With tongue planted firmly in cheek, a group of local bankers on April 1 issued a press release announcing creation of the Waco Bank District within a triangle formed by Valley Mills Drive, Bosque Boulevard and Lake Air Drive, where the member banks do business.
Of course, there is no such district, except in the mind of those who concocted the scheme. Still, it attracted lots of attention, a few laughs, and an observation by some that it really is not a bad idea.
“Honestly, since we launched it we’ve had interest from other businesses that have expressed that this maybe should become a thing, and saying, ‘How do we become a part of the bank district?’ ” said Bryan Fonville, marketing director at Central National Bank.
Dan Ingham, vice president of marketing and communications at The First National Bank of Central Texas, said the group was inspired by the success of other designated areas around Greater Waco, including the Silo District downtown anchored by Magnolia Market at the Silos.
6. National Lloyds Insurance Co. leaves
For five decades, National Lloyds Insurance Co. called Waco home. The name may not have rolled off the tongue like Dr Pepper or Big Red or Magnolia Market, other local brands that have hit the big time.
But it was founded by prominent Waco businessman Clifton Robinson, and it was headquartered for decades at Ninth Street and Austin Avenue in, you guessed it, the National Lloyds Building.
Robinson sold the company in 2000, bought it back nine months later, then completed a deal that stuck in 2006, sending National Lloyds and Waco-based American Summit Insurance to Dallas-based Hilltop Holdings.
Headquarters remained in Waco until this year, when Hilltop said a move to Dallas made sense. It reportedly offered jobs to 80 employees still working for the company in Triangle Tower, New Road at Valley Mills Drive.
7. What has Stainback wrought?
Perhaps no development has prompted more speculation than the regional shopping center the Dallas-based Stainback Organization plans to scatter across 200 acres at West Loop 340 and Interstate 35.
Has Costco been invited? How about another Sam’s Club? Would the Pappas brothers in Houston have an interest in placing a concept there? Options include Pappadeaux Seafood Kitchen, Pappas Bar-B-Q, Pappas Bros. Steakhouse, Pappasito’s Cantina and Pappas Seafood House. Will there be a movie theater? Fitness center? Retailers new to Waco?
A working wish list prepared by Kent Stainback and his son, Ford, shows a 140,800-square-foot retail anchor, a 36,400-square-foot movie theater, three 50,000-square-foot office complexes, a 36,000-square-foot fitness complex, a 136,000-square-foot retailer, a hotel and a convention complex.
Realtor Bland Cromwell is working with the Stainbacks, and he reportedly hopes to meet with the team before year’s end. He hints they are taking names and pursuing deals the community will applaud.
8. Everywhere a hotel
With 2 million visitors pouring into Greater Waco during 2017, and with Magnolia Market at the Silos attracting more tourists than the Alamo, everybody it seems agreed the city needs more places to stay.
How else to explain the growing list of lodging establishments reaching for the sky or appearing on corporate “to-do” lists.
Carla Pendegraft, marketing director for the Waco Convention Center, joined local real estate agents in listing the coming attractions: La Quinta del Sol, South 10th Street and Interstate 35; Springhill Suites, Jack Kultgen Expressway near University Parks Drive; The Aloft, 905 S. 11th Street; Tru by Hilton, Residence Inn and a Choice-branded hotel, all adjacent to Central Texas Marketplace; and Homewood Suites, West Loop 340 and Interstate 35, at Legends Crossing.
And if that is not enough, Realtor Bland Cromwell states: “I know of at least three different groups looking at various locations, and these are not projects that have been announced.”
9. Widening of Interstate 35
Boy, what a loss. El Chico closed on the traffic circle, a casualty of progress cloaked in making I-35 a broader slab of asphalt. Extra lanes need right-of-way, so it was adios to a Tex-Mex tradition of more than 50 years.
Others biting the dust include La Quinta and the popular Clay Pot restaurant, both near Baylor University but too close to I-35 for comfort (although Clay Pot has a new home on Franklin Avenue downtown); a Popeye’s chicken eatery that relocated to Valley Mills Drive near Waco Drive; Denny’s, which abandoned the Baylor area to build in Bellmead; and Standard Hat Works, which moved to the former Piazza Bros. shop on New Road when TxDOT made its landlord an irresistible offer.
More closings are likely as the widening gains momentum.
10. Voters OK tax for Extraco overhaul
McLennan County residents in May approved levying a tax surcharge on hotel stays and car rentals to pump $34 million worth of improvements into the 60-acre fairgrounds anchored by the Extraco Events Center — a site that is becoming a cash cow for the community and would have a $60 million impact on the local economy when improvements are complete.
Wes Allison, Extraco Events Center CEO, called the vote and planned upgrades a “game-changer” in the pursuit of activities that would go beyond livestock shows and rodeos to include sporting events.
Plans include adding a $14 million multipurpose center; rebuilding Waco ISD’s Paul Tyson Field and the Lake Air Little League facilities; and adding another 300 horse and livestock stalls, for more than 1,000 total.
A 5 percent levy on short-term car rentals and an additional 2 percent hotel occupancy tax will cover the cost, according to the voter-approved plan.
Each December, the reporting staff at the Waco Tribune-Herald staff engages in a lively debate over the top stories. That debate ultimately is developed into the list of top stories of the year. Here are the top 2017 stories singled out by reporters and editors here at the Trib.