South Texas cities take the U.S.-Mexico border spotlight.
If you’ve never heard of the U.S.- Mexico border towns of McAllen and Mission, Texas, it is in your best economic interest to remember them. The southern border of the United States has seen tremendous development over the last decade and investors are discovering what is amounting to a modern-day gold rush happening specifically on the border.
About 200 miles south of San Antonio, the McAllen/Mission MSA (part of what is called the Valley of South Texas) is one of the most exciting enclaves of economic prosperity in the nation today, with new businesses opening weekly to serve a rapidly growing population of more than 720,000.
Twenty years ago, the area held less than half the current population, with an economy primarily focused around agriculture. Since then, a tidal wave of investment has changed thousands of acres of farmland into shopping centers, residential subdivisions and new industrial parks. Expansion of local companies and the relocation of more than 500 industrial companies, including several Fortune 500 companies, have created more than 120,000 new jobs.
The McAllen/Mission MSA population is exploding to keep up with the job market, adding more than 150,000 new residents since the 2000 Census and keeping the real estate market strong. Population is projected to double by 2025.
BUSINESS IN MCALLEN/MISSION
Centrally located in one of the nation’s largest trading blocks, McAllen/Mission offers businesses access to new markets and a globally competitive cost structure. Some industries that have already relocated to the area include automotive, aerospace, electronics, appliances, warranty repair and medical supplies, among others.
Fisher & Paykel, a New Zealand appliance manufacturer, is set to take over the former Maytag facility in Reynosa and is estimated to save roughly $50 million a year from consolidated operations and lower labor costs, according to its news release.
Another new regional development is the Rapid Response Manufacturing Center, a university related research, engineering, and design center that enables manufacturers, businesses and budding entrepreneurs to take products from concept to the marketplace as rapidly and as low cost as possible.
THRIVING REAL ESTATE
Despite a housing industry slump across much of the United States., commercial and residential developers are discovering high demand along the South Texas border, so much that the McAllen/Mission area was ranked the fifth best place to buy real estate by CNNMoney.com.
One developer experiencing this success firsthand is Infinity Global Development Group, a luxury condominium developer in South Texas. Infinity’s first project in Mission is Vantage Luxury Condos, a midrise condominium tower that will bring a contemporary style of living to the area. Months after breaking ground, Vantage has sold more than 91 percent of its units and announced the development of two more condominium communities in Mission.
“Prices are too high throughout the rest of the country,” said Fernando Rivera Garcia, CEO of Infinity Global Development Group, LLC. “There is a tremendous demand for quality housing construction here in South Texas because land prices and construction are still reasonably priced.”
Many of the Vantage buyers are successful Mexican national business owners, with another significant portion purchased by retirees who enjoy the border lifestyle.
In addition, border security also plays a role in the vibrant Valley economy. In this unique area, communities on both sides of the border have been very cooperative in recent years in helping to make the area economy strong and secure for all of us who live here.
Eight international bridges now connect South Texas with the industrial border communities of Reynosa, Matamoros and the nearby interior city of Monterrey, Mexico. Together, the regional population totals more than five million with Mission/McAllen being their nearest U.S. retail market. A new international bridge, Anzalduas International Bridge, linking Reynosa, Mexico, to Mission, is on track to open in 2009; another crossing in the metro area has also been announced.
Thousands of annual crossings are improving with the opening of the new SENTRI lanes, which allow quicker access from Mexico. In addition, shoppers spent more than $2.5 billion in McAllen in 2006 making this area one of the most dynamic retail shopping areas in the nation.
Area leaders have been keen to other infrastructure planning needs as well, with a new six-lane expressway now connecting the entire Valley.
Another major artery of transportation will be America’s newest Interstate Highway, I-69, which will connect trade routes from Mexico and Latin America to the United States and Canada. The McAllen MSA will be at the center of that connection hub. In addition, two airports and two international bridges connect McAllen/Mission with the major population centers of Mexico.
“In the past, when the market softens in the U.S., we have always seen an increase in companies looking at our area as a way to reduce their costs and be more competitive,” said Megan Peña, director of marketing at McAllen EDC. “We have the largest market in the world on the north side and a fully fringed wage rate of $2.80 on the south.”
This is evident in the number of companies that have visited the McAllen MSA and Reynosa. The region continues to grow because of its low cost of living, career opportunities and location. Every day, more companies are finding out about us and relocating here. These border towns have been transformed into an exciting and prosperous metropolitan area.
Pat Townsend Jr. is CEO of the Mission Economic Development Authority. For more information on doing business in South Texas, visit www.missioneda.com.