For the folks who remain mystified why Houston’s economy has not collapsed with the price of $OIL, please read below. It hasn’t collapsed because the Houston economy of today bears little resemblance to the Houston economy of the 1980’s. In the 1980’s (30yrs ago) the Port of Houston was not significant on a national scale, today is it significant on a global one as it is the #1 US port by foreign tonnage (2014) and #2 overall in the US.
To be sure the oil and gas industry is a significant one in Houston, but its decline over the past year is not going to sink the economy. What it will do it take an area growing 3X-4X the national average to one growing at or slightly above it. That is a big difference from some of the calamitous predictions we heard not too long ago. For a company like HHC, it matters little as demand for its offerings remains strong and the oil situation is the difference between 8-10 bidders on a property to “just” 3-4 now.
Still a great place to be in
From the Houston Chronicle:
The Port of Houston Authority is predicting record levels of cargo this year, as more steel and cargo containers pass over its docks.
As of June, nearly 20 million tons had come through the port, Port of Houston Authority Executive Director Roger Guenther said this week. Steel and cargo containers led the growth, he said, with 20 percent more containers moving through Barbours Cut and the Bayport Container Terminal than last year, and a 26 percent rise in steel imports.
“Business has reached its highest levels across several key business lines during recent years,” Guenther said in his report to commissioners. “And, we must continue to strategically plan for the future opportunities.”
Full article here