ICOnic News | Mid-Year Economic Update...Better or Worse?
MID-YEAR ECONOMIC UPDATE...BETTER OR WORSE?
The Mid-year Economic Update at the July CCIM Chapter Luncheon hosted the insights of Dr. Robert Gilmer (University of Houston) and Dr. Daniel Oney (Texas A&M). They discussed the news about the US economy throughout 2023 and into the foreseeable future. That news tends to focus on one word: recession. Are we in a recession or even headed for a recession? It seems that some combination of the restrictive actions of the federal government on interest rates and a very robust economy, the US is not imminently headed toward a recession but rather a slowdown.
Dr. Gilmer said that there will continue to be pressure from the Fed to keep a true recession at bay, and the search is currently on to find tools other than raising interest rates to battle the threat of a real recession. One of the global markets that is reflecting this push-pull economic struggle with a myriad of influencing forces is the price of oil. With the continued armed conflict that has now spilled over into the Black Sea, we will continue to see gas and oil prices stretching upwards. OPEC is also pushing for higher prices per barrel, so we can expect this recent bump in prices to maintain for at least the short term through the fall. Finally, another pressure point on the economy has been bank failures. While we will probably see some of these regional banks still struggle with being overextended with CRE loans, the big banks are in great shape and the Federal Reserve has done solid work to insure their value and strength.
In the Houston market, Dr. Oney said there is a strong desire to be better “recession proofed” by continuing to diversify the economy. In particular, for years Houston-area leaders and corporations have had a desire to expand the biomedical research industry in Southeast Texas. It has been a highly competitive field that has historically been led by several metro areas in California and Raleigh, North Carolina. While Houston and Texas have a lot to offer these biomedical companies to relocate, there are several challenges that can make it unattractive for them to consider the Houston area as a viable option. The Houston area has to overcome some stigmas regarding flooding, hurricane exposure and overall weather conditions. Overall, the Houston market remains strong and the outlook for the rest of 2023 is better than expected with multi-family housing and the oil and gas industries driving much of the new construction in the area, along with the continued slight moderation of construction prices.
Even with some internal and external forces complicating some things in the market, Dr. Gilmer and Dr. Oney believe Houston’s economic and real estate outlook is strong and will continue to be a prime national location for investment opportunities as well as for companies looking for a more than reasonable relocation opportunity.
- Mindi Sanders, Vice President of Administration
GIVING BACK WITH ATTACK POVERTY
Being actively engaged and serving in the community where we live and work is a big part of ICO’s mission.
Last month we served with Attack Poverty to help assemble emergency preparedness buckets for the upcoming hurricane season. The buckets included flashlights, anti-bacterial wipes, an emergency guide, hand soap, a thermal blanket, and cell phone chargers. It was a great way for us to give back to our community and to serve together as a company.
Attack Poverty's vision is to empower people to attack poverty in their life and community by strengthening under-resourced communities through spiritual growth, education, revitalization, and basic needs.
