According to Chad Burke, president and CEO of the Economic Alliance Houston Port Region, 2020 is set to become another landmark year for economic development in the 12-city Southeast Harris County region that makes up the Houston Ship Channel, following a stellar 2019 for his organization and the region as a whole.
In 2019, the Economic Alliance Houston Port Region was directly involved in six major projects that translated into 285 new jobs and $3.6 billion in capital investments — the most impactful year in the organization’s history.
“It’s a direct reflection of the influx of capital investment in this region and the chemical industry,” Burke said. “Part of that equation is the growth and reach of economic development. The more projects we get our hands-on, the more we can help and the larger those numbers can get. Part of that is us, as an organization, bringing more and more people into the fold to help with our economic development mission.”
The Economic Alliance Houston Port Region, which works with companies to either locate or expand in the region, enlists members from all levels of government to assist in attracting as many projects as it can. Its members have helped develop what Burke calls the organization’s “project pipeline” for 2020, with 31 active projects, 3,000 direct jobs and $7.6 billion in total capital investment going into the new decade.
“That pipeline is our finger on the pulse of how this local economy is doing,” Burke said. “Moving into 2020, the pipeline is as large as we’ve ever seen it. The timing and size of the projects are always going to determine what happens, but it’ll be another healthy year.” Over the past four years, public spending on U.S. ports totaled $22 billion, compared to $132 billion in private spending, Burke noted. Of that $132 billion, $122 billion has been spent on the Gulf Coast — an unprecedented level of capital investment. This staggering pace of growth is directly related to the long-term, low-cost feedstock coming from the Permian Basin, where 10 times the number of oil reserves are located compared to the amount located throughout the entire U.S. 10 years ago.
Although the core focus of the Economic Alliance Houston Port Region is economic development, it has also launched supporting initiatives to accommodate the rapid growth in the region. Its initiatives in the realm of infrastructure are of particular importance, with projects being funded, engineered and built throughout the region thanks in large part to the organization’s efforts. Burke also noted the No. 1 priority for his organization this year, and for the oil and gas industry as a whole, will be widening the Houston Ship Channel.
While Burke expects a similarly large influx of capital investment in the region over the next few years, he believes the rate of investment will begin to slow by around 2024, at which point the region’s “expansion phase” will be nearing its end. At that point, he predicts investment will grow at the rate of global GDP.
“When you look back at the trajectory of the past 10 years of economic development in this region and the growth of the chemical industry, we’re getting near the top of the bell curve,” Burke explained.
“That’s not a bad thing, even though large capital investment may slow. We’ll still be in a good position as far as turning around these facilities on a regular basis, operating them and moving all of that product in and out of this region.
“The future looks really good for us. We recognize that we won’t always have $2 billion or $3 billion a year in capital projects we’re working on, but we’re going to be in a good, strong manufacturing economy for the long term.”
For more information, visit www.allianceportregion.com or call (281) 476-9176.