Southeast Texas Commercial Real Estate News – Port Arthur Commercial Construction Forecast 2015

August 2, 2015

Development Companies, General Contractors, Management Companies, Property Owners, Subcontractors & Commercial Services

Bill McCoy Port Arthur Chamber of Commerce

On today’s edition of Southeast Texas Commercial Real Estate News, we turn our eye to Mid County.

The Port Arthur area will be booming with industrial and commercial construction forecast for 2015 and beyond.

Southeast Texas Commercial Real Estate Magazine sat down with Port Arthur Chamber President Bill McCoy to talk about forecasting the Mid County commercial and industrial real estate sector.

According to Bill, the biggest current factor on both sides of the Texas/Louisiana border is LNG.

Southeast Texas businesses have long lived the feast and famine cycle of the Southeast Texas oil industry. The highs are exhilarating, but the lows can cripple a small or even mid-sized business, particularly if businesses overspend in the boom periods and aren’t prepared for the dips.

First – most of the hardest lows affect businesses tied to exploration and drilling. McCoy pointed out that the refineries themselves make money whether oil is at $100 a barrel or $50.

The Golden Triangle does have a lot of businesses in the exploration and drilling sectors, and those have been greatly affected by changes in the price of oil. When the price of oil is up, these companies move a tremendous amount of money through the Southeast Texas economy – they hire lots of people, they buy lots of company (and personal) trucks, and they build sprawling complexes where they can fabricate or store mats and drilling equipment, or whatever they need for their particular specialty. When the price of the oil is down for too long, they have big layoffs, they stop buying new vehicles, and their complexes are locked up for sale or lease during the next uptick.

For our Southeast Texas Commercial Realtors BIG properties often move quickly, particularly leases, when companies move into Mid County to get their piece of the latest refinery expansion or pipeline construction pie.

Slow periods mean longer turnover periods for Southeast Texas industrial and light industrial properties or working with property owners to set prices that are in line with the market.

LNG will provide the Mid County economy with a buffer during what has been a famine cycle in the past. The beauty of our two new “Mega” LNG terminals is that they are set up to import or export with equal ease.

When the price swings to make importing more attractive, Cheniere and Golden Pass LNG can bring in enormous quantities of LNG for the domestic market. If the price swings the other way and it is economically more attractive to export LNG, the plants can flip the switch and start exporting at an equal rate.

What is more important than whether we’re exporting or importing LNG at any given time is the stability of the Southeast Texas job market – and the resulting stability of their dollars. Stability at the plants whether LNG is selling high or low, translates into job stability which make it easier for workers to commit to buying homes, shiny new Ford trucks and Mustangs, furniture, and the other cogs that keep the Mid County community humming.

More stable income for workers makes them comfortable treating the family to new outfits at Central Mall, splurging on a nice dinner at The Beau Reve or La Suprema, or buying a boat to fully explore the world class fishing offered by Sabine Pass, Lake Sam Rayburn, and Toledo Bend.

Most importantly, these are high paying jobs, sorely needed across The Golden Triangle.

The stability of the LNG facilities will also mean a sustained need for all of the support businesses that are needed to keep a plant humming: plumbers, electricians, caterers, and industrial construction firms for upgrades and expansions.

It’s always wonderful when our local Southeast Texas general contractors and subcontractors are working – all of that money stays in the local economy. When these businesses are comfortable looking at catering vans, plumbing trucks, private school tuition, and hiring more employees it is a win for the whole SETX economic ecosytem.

Our local economy will always have a blessing from the oil industry and refineries. They are the keystones that hold the economy together and we are grateful for them.

Think of LNG as the cousin with a nice well paying middle class job – maybe not as flashy as the oil industry during a boom, but you can always depend on them when other market sectors get tough.

Are there ways your business can grow by serving the LNG sector?

Both Cheniere and Golden Pass LNG have made a sincere effort to dialogue with Southeast Texas owned businesses- and to hire employees from within our communities.

They need many of the same services the refineries need – process operators, supervisors, tugboat drivers, AC companies, plumbers, painters, Southeast Texas industrial and commercial caterers, facilities for corporate training events, fleet vehicles, and more.

Find out more about these plants and get a feel for how they (and their workforce) can be part of your growth in 2015 and beyond:

Golden Pass LNG:

3752 S Gulfway Dr, Sabine Pass, TX 77655
(409) 971-4200

GoldenPassTerminal.com

Cheniere LNG

9243 Gulf Beach Hwy, Cameron, LA 70631
(337) 569-7700

Cheniere.com/LNG_terminals

We enjoyed the opportunity to interview Bill McCoy with the Port Arthur Chamber and extend our thanks for his time and his insight into the Port Arthur commercial and industrial real estate sectors.

There is more big news coming for Port Arthur and Mid County and we’ll start tackling it in upcoming editions of the Southeast Texas Commercial Real Estate News.