RealReal EstateEstate MarketMarket OverviewOverview TylerTyler

Jennifer S. Cowley Assistant Research Scientist Dana M. Pechacek Graudate Research Assistant

Texas A&M University

July 2001 © 2001, Real Estate Center. All rights reserved. RealReal EstateEstate MarketMarket OverviewOverview TylerTyler

Contents

2 Population 5 Employment 8 Job Market Major Industries

9 Business Climate 10 Transportation and Infrastructure Issues Public Facilities

11 Urban Growth Patterns Growth Areas Map

12 Education 13 Housing 16 Multifamily 17 Manufactured Housing Retail Market

18 Office Market 19 Industrial Market 20 Conclusion RealReal EstateEstate MarketMarket OverviewOverview TylerTyler Jennifer S. Cowley Assistant Research Scientist Dana M. Pechacek Graudate Research Assistant

Interstate 20

US Hwy 271 US Hwy 69

State Hwy 31

Tyler Chandler New Chapel Hill

State Hwy 155 State Hwy 64

Noonday US Hwy 69 Whitehouse Arf

Area Cities and Towns County Land Area of Tyler MSA Arp Mount Sylvan Smith 942 square miles Big Sandy Tyler Garden Valley Whitehouse Population Density (2000) Lindale Winona 186 people per square mile

he Tyler Metropolitan Statistical the 13th best small place for technology annual Azalea and Spring Flower Trail Area (MSA) is a manufacturing, companies by Forbes magazine in in March and April that draws thou- T health care, education and retail 2000. Tyler is considered “The Rose sands of tourists. Tyler is located be- center for East . Tyler was ranked Capital of America” and sponsors an tween Dallas and Shreveport along I-20.

1 POPULATION Kelly Air Force Base, San Antonio

Tyler MSA Population Year Population 1990 151,467 1991 153,286 1992 154,576 1993 157,297 1994 159,193 1995 161,410 1996 163,625 1997 165,693 1998 168,070 1999 169,693 2000 174,706

Source: U.S. Census Bureau

Texas Metropolitan Area Population Change, 1990–2000 (in percent)

McAllen-Edinburg-Mission 48.5 Galveston-Texas City 15.1 Austin-San Marcos 48.2 Tyler 15.5 Laredo 44.9 El Paso 14.9 Dallas 31.5 Corpus Christi 14.3 Brownsville-Harlingen-San Benito 28.9 Victoria 13.1 Brazoria County 26.1 Waco 12.9 Houston 25.8 Texarkana 9.4 Fort Worth-Arlington 25.1 Lubbock 9.0 Bryan-College Station 25.1 Wichita Falls 7.8 Texas 22.8 Longview-Marshall 7.7 Killeen-Temple 22.6 Beaumont-Port Arthur 6.6 San Antonio 20.2 Abilene 5.8 Sherman-Denison 16.4 San Angelo 5.6 Amarillo 16.2 Odessa-Midland 5.1

Source: U.S. Census Bureau

he MSA’s population grew by average annual rate of 1.2 percent Development Board predicts a faster 15.5 percent from 1990 to 2000. through 2005. Over the next 20 years, growth rate of 1.6 percent per year T The Texas State Data Center the area is expected to grow at a rate of through 2020. forecasts the Tyler MSA will grow at an 0.7 percent per year. The Texas Water

2 Tyler MSA Projected Population Texas State Texas Water Year Data Center Development Board

2005 175,380 — 2010 183,297 201,028 2015 189,382 — 2020 194,917 227,931

Sources: Texas State Data Center and Texas Water Development Board

Projected Population Growth, 2000–2020 (in percent)

50

40

30 20 40.2 10 18.0 0

Tyler MSA Texas

Source: Texas State Data Center

Household Composition Tyler MSA Texas

Median household size (1990) 2.66 2.73 Population younger than 18 (1999, in percent) 26.1 28.5 Population 65 and older (1999, in percent) 13.9 10.1

Source: U.S. Census Bureau

3 Ethnic Distribution (in percent) Tyler MSA Texas Ethnicity 1990 2000 1990 2000

White 72.6 67.9 60.8 52.4 Hispanic 5.9 11.2 25.3 32.0 Black 20.7 19.0 11.7 11.3 Asian 0.4 0.7 0.3 2.8 American Indian 0.4 0.3 1.8 0.3 Other 0.0 0.1 0.1 0.1 Two or more races* — 0.9 — 1.1

* For the 2000 Census, the Census Bureau changed the “race” options, allowing people to report their race as “other” or as two or more races. Source: U.S. Census Bureau

he Tyler MSA has a slightly ity population increased between come was $26,711. The state average larger portion of its population 1990 and 2000, following a statewide was $26,834, according to the U.S. T age 65 and older compared with trend. The MSA’s 1999 per capita in- Bureau of Economic Analysis. the state as a whole. The area’s minor-

4 EMPLOYMENT

Tyler MSA Employment

70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Source: U.S. Bureau of Labor Statistics

Tyler MSA Unemployment Rate (in percent) 10 9 8 7 6 5 4 3 2 1 0 May May May May May May Sept Sept Sept Sept Sept Sept January-95 January-96 January-97 January-98 January-99 January-00 January-01

Source: U.S. Bureau of Labor Statistics

5 Top Ten Employers Top Ten Private Employers

East Texas Medical Center East Texas Medical Center Health care Health care 3,100 employees Bergstrom Air Force Base,3,100 employees Austin Trinity-Mother Frances Health System Trinity-Mother Frances Health System Health care Health care 2,800 employees 2,800 employees Brookshire’s Grocery Company Brookshire’s Grocery Company Grocery distribution Grocery distribution 2,475 employees 2,475 employees Tyler Independent School District Trane Company Education Heating-cooling unit manufacturing 2,200 employees 2,000 employees Trane Company Kelly-Springfield Heating-cooling unit manufacturing Tire manufacturing 2,000 employees 1,246 employees University of Texas Health Center at Tyler Tyler Pipe Health care Cast iron pipe 1,371 employees 1,100 employees Kelly-Springfield Carrier Air Conditioning Tire manufacturing Heating-cooling unit manufacturing 1,246 employees 1,100 employees Tyler Pipe Target Cast iron pipe Retail distribution center 1,100 employees 1,012 employees Carrier Air Conditioning Howe-Baker Engineers Heating-cooling unit manufacturing Petrochemical equipment 1,100 employees 450 employees Target John Soules Foods, Inc. Retail distribution center USDA inspected meat processing 1,012 employees 379 employees

Source: Tyler Economic Development Corporation, 2001

Employment Growth by Industry Tyler MSA Texas

Employment growth, 2000 (in percent) 3.7 3.2 Unemployment rate (in percent) 4.0 4.3 New jobs in 2000 3,000 288,900 Employment growth by sector (in percent) Services 5.8 4.7 Trade 3.6 3.1 Manufacturing 1.8 0.1 Mining –7.1 2.3 Finance, insurance and real estate 4.9 1.3 Construction 0.0 6.2 Government 2.6 1.7 Transportation, communications and public utilities 5.9 5.1

Sources: U.S. Bureau of Labor Statistics and Texas Workforce Commission

6 Texas Metropolitan Area Employment Change, 1990–2000 (in percent)

Austin-San Marcos 58.8 El Paso 15.4 Laredo 40.3 Waco 14.3 McAllen-Edinburg-Mission 35.8 Lubbock 14.0 Dallas 30.4 Sherman-Denison 12.5 Brownsville-Harlingen-San Benito 30.1 Longview-Marshall 12.2 Bryan-College Station 29.2 Abilene 11.4 Killeen-Temple 28.7 San Angelo 10.7 San Antonio 28.6 Corpus Christi 10.3 Fort Worth-Arlington 23.7 Galveston-Texas City 8.2 Texas 23.3 Wichita Falls 7.8 Tyler 22.9 Odessa-Midland 6.5 Victoria 22.4 Texarkana 4.5 Houston 22.1 Beaumont-Port Arthur 3.5 Amarillo 18.6 Brazoria County 2.3

Source: U.S. Bureau of Labor Statistics, February 2001

ccording to the Texas Work- ing to the U.S. Bureau of Labor Statis- and transportation, communications force Commission, Tyler’s ave- tics. In contrast, the Texas Workforce and public utilities employment. Man- A rage unemployment rate was Commission reported the average power Incorporated, a staffing services 4.3 percent in 1999 and fell to 4 per- number of nonagricultural workers company, reported that 37 percent of cent in 2000. During 1999, the aver- employed during 1999 and 2000 was Tyler employers planned to add jobs age number of civilians employed in 81,000 and 84,000, respectively. during the first quarter of 2001. Only Tyler was 85,774. This figure rose to The increase in employment can be 13 percent expected a decrease in an average of 87,190 in 2000, accord- attributed to the increase in services employment.

7 JOB MARKET

arget added 200 workers to its Institute of Tyler opened in September November 2000. One hundred workers distribution center in summer 2000 and will add a total of 140 em- lost their jobs but the new company, e- T 2000, bringing its total employ- ployees by the end of 2001 to bring to- TeleQuest Inc., will employ 200 of ment to 1,200. Brookshire’s Grocery tal employment to 250. TeleQuest’s original 300 employees. expanded its distribution warehouse in Marathon Oil Co. closed its Tyler of- Approximately 130 jobs were lost summer 2000, creating 97 new jobs. fice at the end of 2000, laying off 100 when Dearborn Brass closed its East Classic Cable Inc. is expanding its workers. TeleQuest Teleservices filed Texas Center plant in spring 2001. existing building and will add 300 jobs for bankruptcy in June 2000 and was Doctors Memorial Hospital closed in during 2001. The Musculoskeletal purchased by a holdings group in August 2000, laying off 85 employees.

MAJOR INDUSTRIES

ervices is the largest sector of the Manufacturing represents 13 percent makes up 4 percent of area employ- Tyler economy, representing 30 of area employment and added 200 ment. S percent of total employment. Ser- jobs during 2000. Tyler has several In 1999, Smith County agricultural vices sector employment increased in manufacturing companies, including receipts totaled $137.2 million. Nurs- 2000, posting a gain of 1,800 jobs. The two heating-cooling unit manufactur- ery products accounted for 73 percent trade sector increased by 800 jobs in ers. The government sector represents of these receipts, and beef cattle ac- 2000, accounting for 27 percent of to- 14 percent of area employment and counted for 9 percent. The rose indus- tal employment. The Tyler MSA ranks added 300 jobs during 2000. The min- try accounts for the majority of the first among Texas MSAs in trade as a ing sector was down 100 jobs in 2000. area’s agricultural production. Hay percent of total employment. The area The transportation sector added 200 and timber are other important agricul- is a growing distribution sector with jobs in 2000. The transportation, com- tural products, according to the Texas the addition of a Target distribution munications and public utilities sector Agricultural Extension Service. center and Brookshire Grocery distri- bution center expansion.

8 BUSINESS CLIMATE

Tax Rates, 2000 Smith County Tax Rate per Taxing Entity $100 Valuation

City of Tyler $0.28 Smith County 0.25 0.12 Tyler Independent School District 1.36 Total $2.01

Source: Smith County Appraisal District

Tyler MSA Retail Sales

Year Total Sales Sales per Capita

1990 $1,280,688,542 $8,455 1991 1,351,962,801 8,820 1992 1,460,023,784 9,445 1993 1,622,603,294 10,316 1994 1,820,810,566 11,438 1995 1,910,000,610 11,833 1996 1,979,926,641 12,100 1997 2,036,581,314 12,291 1998 2,229,740,763 13,267 1999 2,512,779,387 14,808 2000 2,573,670,550 14,731 State Average 2000 $12,612

Source: Texas Comptroller’s Office

yler has high retail sales per ing incentives to encourage compa- long as ten years on all new plants and capita because of area tourism nies to locate in the city. The council equipment. T and its status as a trade center. focuses on recruiting firms that create Each year Tyler hosts the Texas Rose Tyler’s sales tax rate is 8.25 percent. jobs and generate incomes that will Festival during the third weekend in The city’s one-half cent economic de- trickle into other parts of the economy. October. The five-day festival attracts velopment sales tax provided funding Three enterprise zones have been 88,000 people and has an estimated for approximately $8 million in infra- created by the city with incentives $1.9 million impact on the economy. structure improvements in 2000 and such as sales tax refunds, training The $50 million rose industry itself has eliminated the city’s need to issue gen- funds and tax abatements for locating shifted from growing roses to market- eral obligation bonds. Tyler’s hotel- in the zones. Smith County and the ing and distributing them. However, motel tax rate is 13 percent. City of Tyler also have reinvestment about nine rose processors still operate The Tyler Economic Development zones where companies are eligible in the area. Council offers tax, financing and train- for 100 percent tax abatements for as

9 TRANSPORTATION AND INFRASTRUCTURE ISSUES

Tyler Airline Boardings 1997 1998 1999 2000

Tyler Pounds Field Airport 73,415 73,990 77,795 74,563

Source: Tyler Pounds Field Airport

-20 runs through Smith County American Eagle and Continental Ex- use Lake Palestine to meet increasing north of Tyler. U.S. 271 and U.S. 69 press service Tyler’s Pounds Field Air- future water demand. In November Ias well as Texas Highways 31, 64, port. Austin Express provided commer- 2000, construction began on the first 110 and 155 are the other major thor- cial service to Austin until December of five phases for a $60 million water oughfares in the MSA. Loop 323 en- 2000 when it ceased its commercial pump station and treatment plant at compasses much of Tyler. In February, operations to concentrate on charter Lake Palestine. the City of Tyler began a $1.4 million service. Construction on a 38,000- Initially, the project will process 30 street improvement project to overlay square-foot terminal building began in million gallons of water per day, but portions of almost 100 city streets. The June 2000. The $15 million west-side future expansion will boost production 2001 Asphalt Overlay Program in- terminal facility will open at the end of to 60 million gallons per day. The city volves 26 miles of streets; the work 2001. predicts that the expansion will be should be completed by October. Tyler obtains its water from Lake needed by the year 2020. All five Rail service within the Tyler MSA is Tyler and Carrizo-Wilcox Aquifer phases of construction should be com- provided by Missouri Pacific and wells. In addition to more intensive use pleted by 2003. Union Pacific. of Lake Tyler, the city has contracted to

PUBLIC FACILITIES

he $1.7 million Tyler Civic The- be widened to 10 feet and 34,800 feet tipurpose room, game room and cov- atre, located near the Tyler Rose of new trails will be constructed of re- ered picnic pavilion, opened in April T Garden, opened in September inforced concrete. Work will be com- 2001. The $3 million, 16,000-square- 2000. The facility includes the 350- pleted by 2004. foot facility is at the intersection of seat Braithwaite Theatre and the 150- Faulkner Park, Tyler’s newest city West 32nd Street and North Broadway seat Rogers Children’s Theatre, and park, opened in April 2001. The $3.9 Avenue. features a marbletop concession area million, 40-acre park has eight base- The City of Tyler is home to an ac- and ticket booth, a terrace overlooking ball fields and eight tennis courts. In a tive performing and fine arts commu- the rose garden, a garden courtyard future phase of the park, a $180,000 nity. Performances by the East Texas area and state-of-the-art computerized tennis pro shop and restroom facility Symphony Orchestra, Tyler Youth Or- sound and lighting systems. will be built near the tennis courts. chestra and the Tyler Civic Ballet are In November 2000, a $3.5 million Glass Recreation Center, a recre- examples of the cultural activities expansion project for the Rose ational facility that features an indoor offered. Rudman Recreation Trail was ap- basketball court, jogging track, art Tyler also has an array of museums: proved. Pedestrian and bike trails will classroom, computer laboratory, mul- Tyler Museum of Art, Hudnall Plan-

10 etarium, Tyler Rose Museum, Tyler seum, Goodman Museum, Discovery Tyler State Park is a 985-acre park Municipal Rose Garden, Smith County Science Place, and located on FM 14 North that offers Historical Museum, McClendon Brookshire’s World of Wildlife Mu- camping, boating, fishing, hiking and House, Historic Aviation Memorial seum and Country Store. canoe and paddleboat rentals. Museum, Harrolds Model Train Mu-

URBAN GROWTH PATTERNS

US 69 US 271

SH 64 SH 124 SH31

US 69 SH 31 Industrial Residential SH 64 SH 323 CR 2493

SH 110 Retail Retail SH 155 Retail Growth Areas Residential Tyler, Texas Census Place US 69 Water Area Highway Interstate Highway Source: Real Estate Center at Texas A&M University

n Tyler, development is occurring Downtown revitalization efforts are Residential growth is occurring in primarily in the south (see map), ac- under way, with developers converting southeast and southwest Tyler. Major Icording to Tyler Planning Depart- many older buildings located around residential developments are located ment officials. Retail growth is occur- the square. In the future, office growth southwest of the Grande Boulevard ring along South Broadway Avenue is expected to take place on the fringe and South Broadway Avenue intersec- south of Loop 323. The South Broad- of the central business district because tion, as well as south of University way corridor’s status as the leading re- of zoning changes. Boulevard. Extensive, moderately- tail district in East Texas will be under- Industrial growth is most prevalent priced residential development is oc- scored with the development of Tyler in the industrial parks, especially south curring south of the city, near MarketCenter, a multitenant retail cen- of State Highway 31 near Loop 323. Whitehouse in unincorporated areas. ter. Retail growth can also be seen along Troup Highway.

11 EDUCATION

Educational Level, Persons Age 25 and Older (in percent) Level of Education Tyler MSA Texas

High school graduate 23.4 25.6 Some college, no degree 24.0 21.1 Associate's degree 8.5 5.2 Bachelor’s degree 13.5 13.9 Graduate or professional degree 6.2 6.5

Source: U.S. Census Bureau, 1990 Census

Local College and University Enrollment

Fall 2005 2010 School 2000 (estimated) (estimated)

Tyler Junior College 8,240 8,168 8,199 University of Texas at Tyler 3,800 4,308 5,013 281 n/a n/a

Sources: Educational institutions and the Texas Higher Education Coordinating Board, January 2001

he University of Texas at Tyler college’s Regional Training and Devel- Tyler Independent School District is was established as a two-year, opment Complex offers continuing the largest school district in northeast T upper-level university in 1971 education programs, provides em- Texas. It covers 193 square miles and and became part of the University of ployee training for firms and includes a includes 19 elementary schools, six Texas System in 1979. In 1997, the small business development center middle schools, two high schools, an school became a four-year university. that assists entrepreneurs in opening alternative school, an alternative high The institution offers 44 bachelor’s de- new businesses. The complex opened school and a special education center. grees and 28 master’s degrees. The an ACT center, which offers training Approximately 16,000 students are en- University of Texas Health Center at and computerized testing services to rolled at Tyler ISD campuses. Tyler Tyler provides health education individuals, businesses and profes- also has three private schools and pa- courses. sional organizations, in April 2001. rochial middle and high schools. UT-Tyler is planning construction of The University of Texas Health Sci- The former John Tyler High School a $7.3 million nursing facility during ence Center at Tyler is planning to was converted to the Caldwell Elemen- 2001. Also, in late 2000, construction build a $15 million, 30,000-square- tary School, named after a local family. began on the university’s $1.35 million foot addition to the Biomedical Re- Cost for the remodeling was $3.5 mil- carillon tower. The 88-foot tower will search Building. The project is ex- lion. The elementary school has 19 have 57 cast bronze bells and will be pected to be completed in April 2004. classrooms as well as office, kitchen the largest carillon in Texas and among Texas College, an historically black, and gymnasium facilities. Caldwell El- the 15 largest in the United States. four-year institution of higher educa- ementary School will replace Gary El- Tyler Junior College was established tion, offers 13 degree programs. The ementary which, after approval by the in 1926 as part of the Tyler Public Community Service Development Tyler ISD Board, will undergo remod- School System. The college now offers Center located in the Glass Building is eling to create a facility for gifted and more than 200 courses and is the larg- undergoing renovations. Completion talented students and technology labs est junior college in Texas. The is scheduled for summer 2001. for teachers and administrators.

12 HOUSING

Housing Affordability – Fourth Quarter 2000

Percent of Households THAI for That Can Afford First-time Median-priced Home THAI* Homebuyers

Tyler MSA 64 1.40 1.03

*The THAI is the ratio of median household income to the income required to buy the median-priced home using currently available mortgage financing. Standard financing is a 30-year loan covering 80 percent of the cost of the home. A THAI of 1.00 indicates that the median household income is just enough to qualify for a loan sufficient to purchase the median- priced home. Source: Real Estate Center at Texas A&M University

Tyler MSA Single-family Building Permits

600

500

400

300

200

100

0 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Source: U.S. Census Bureau

13 Average Sales Price of Single-family Tyler MSA Homes $140,000

$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

$0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000

Source: Real Estate Center at Texas A&M University

Single-family Home Sales Volume, Tyler Area (in units)

250

200

150

100

50

0 May July April June March August October January February November December September 1998 1999 2000

Source: Real Estate Center at Texas A&M University

14 Price Distribution of MLS Homes Sold, Tyler Area (in percent)

Price Range 1997 1998 1999 2000

Less than $60,000 23.8 25.0 25.3 21.7 60,000–79,999 18.6 16.8 16.6 17.4 80,000–99,999 15.8 17.1 15.7 15.4 100,000–119,999 11.0 10.0 11.5 10.5 120,000–139,999 7.7 9.1 7.9 8.8 140,000–159,999 6.6 5.6 6.1 6.0 160,000–179,999 5.5 4.3 4.2 5.6 180,000–199,999 3.3 2.8 3.3 3.9 200,000–249,999 4.0 3.8 4.3 5.4 250,000–299,999 2.5 3.8 2.7 2.2 300,000 or more 1.1 1.8 2.3 3.3

Source: Real Estate Center at Texas A&M University

n 2000, 467 single-family home will maintain the homes on the 37-acre In Lindale, the Thicket Addition has permits were issued in the metro- development site. Five 1.5-acre water- homes priced in the upper $100,000s Ipolitan area. This figure was up front lots will be sold to nonmembers. and continues to expand. Woodlands from 440 in 1999. The average value New homes are also being constructed Park, a new subdivision in Lindale, is of new homes in the MSA was along Lake Palestine. developing its 31-lot Phase I, with $149,800 in 1999, compared with In Tyler, Holly Tree West and homes priced from $64,000 to $144,500 in 2000. In the first four Copeland Woods both offer homes $88,000. months of 2001, 109 single-family priced from $200,000 to $300,000 and In Chandler, North Creek Estates has home permits were issued. are developing lots. Homestead subdi- begun construction of Phase III, con- The number of homes reported sold vision has 54 of its 98 lots developed sisting of 48 lots. Phase I is already through the MLS decreased and aver- and is continuing to build homes completed and Phase II has 6 lots age sales price for homes increased priced from $125,000 to $200,000. available. The Vista, a new subdivision from 1999 to 2000. The total unit sales Charleston Park, Tyler’s newest subdi- west of Chandler off Highway 31, has volume for 1999 was 2,062, while the vision, began construction of Phase I in sold all 14 lots in its Phase I. In early 2000 figure declined to 1,961. The av- January 2001. Phase I includes 32 lots 2001, construction began on Phase II, erage sales price increased $6,600 and homes priced from $180,000 to which includes 24 lots. Both North from 1999 to 2000, to $114,400. $230,000. A total of 570 lots will be Creek Estates and The Vista offer Months of inventory available fell to developed. homes priced from $150,000. 9.1 in 2000 from 9.9 during 1999. The Woods is a gated community Whitehouse, south of Tyler, is home Reunion Harbor is a new private with homes priced from $200,000. to Baker Plantation. The subdivision club on Lake Tyler. One hundred Brighton Creek is located within The includes a lake and has luxury homes memberships will be sold for $30,000 Woods and has estate-sized lots from priced in the $300,000s. each, plus a $100 monthly mainte- one to three acres. Homes are priced nance fee. Club members will pur- from $500,000 to $1 million. chase lake homes, but management

15 MULTIFAMILY

Tyler MSA Multifamily Building Permits (in units) 2,500

2,000

1,500

1,000

500

0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000

Source: U.S. Census Bureau

Tyler Apartment Statistics, January 2001

Tyler Texas Metro Average

Average rent per square foot $0.60 $0.75 Average rent for units built since 1990 $0.75 $0.97 Average occupancy (in percent) 95.0 95.6 Average occupancy for units built since 1990 (in percent) 97.6 95.5

Source: Apartment MarketData Research

n 1999, 90 multifamily building increased from 58 cents per square day roads was designed for low- permits were issued; the number foot in January 2000 to 60 cents per income families. Rental rates range Ifell to 67 permits in 2000. In the square foot in December 2000. from $432 per month for a 1,200- first four months of 2001, 21 multifam- Construction of a new 114-unit square-foot, two-bedroom unit to $688 ily building permits were issued. townhome complex, Pine Creek per month for a 1,439-square-foot, The occupancy rate rose from 94.5 Townhomes, was completed in Octo- four-bedroom unit. percent in January 2000 to 95 percent ber 2000. The $7.1 million develop- in December 2000. Rental rates ment near Lake Placid and Old Noon-

16 MANUFACTURED HOUSING

Tyler MSA Manufactured Home Sales Proportion of New Manufactured Single-family Homes Homes Sold (in percent)

1997 589 66.4 1998 638 67.6 1998 628 68.5 2000* 438

*Through third quarter 2000 Source: Texas Manufactured Housing Association

RETAIL MARKET

Retail Property Statistics, 2000

Vacancy Rate Average Rent (in percent)

Neighborhood Service Center $9 7 Community Power Center $12 3 Regional Mall $24 6

Source: Burns & Noble Commercial Real Estate Services

Hotel Occupancy and Rental Rates

1999 2000 Tyler Texas Tyler Texas

Occupancy rate (in percent) 60.5 64.1 58.4 65.7 Average daily rental rate $61.07 $84.08 $59.29 $86.45

Source: PKF Consulting

yler has more than 2.2 million city’s restaurant sales are expected to taurant Association. Chuck E. Cheese’s square feet of retail space, ac- grow 5.2 percent to $204 million dur- Pizza opened on Loop 323 in August T cording to Burns & Noble. The ing 2001, according to the Texas Res- 2000. A $1.5 million, 15,635-square-

17 foot Traditions restaurant opened on Home Depot also purchased a site to In fall 2000, construction began on South Broadway Avenue. The restau- the south of its new store that was the the Tyler MarketCenter project. Lo- rant features outdoor dining with a caf- former location of Murphy’s Furniture cated on Broadway Avenue, the $11 eteria on one side of the restaurant and Gallery. The former store will be de- million project includes remodeling a bakery and bistro on the other side. molished and Murphy’s will open a the 82,385-square-foot former Target Texas Roadhouse built a 6,798-square- new 26,115-square-foot showroom on store and constructing an additional foot, $600,000 restaurant on Loop 323 South Broadway Avenue in 2001. 21,775-square-foot building. Fifteen that opened in June 2001. O’Reilly Auto Parts will construct a retailers will be located in the com- Holiday Inn Express opened a 67- 6,325-square-foot store on Troup pleted retail center, including Ross room, $2 million hotel on W. Gentry Highway. The $380,000 store will Dress for Less, Linens ‘n Things, Gate- Parkway in Spring 2000. Wingate Inn open during 2001. In March 2001, way Country and Jason’s Deli. The first completed an 88-room, $3 million ho- Tyler’s first Saturn car dealership stores are expected to open by summer tel on Loop 323 in July 2000. opened at Loop 323 and Texas High- 2001. In March 2001, Home Depot com- way 155. The Saturn dealership is the pleted a $2.6 million, 108,000-square- first in East Texas. foot store on Old Jacksonville Highway.

OFFICE MARKET

Tyler Office Market Statistics, October 2000 Number of Total Square Occupancy Rate Average Annual Buildings Feet (in percent) Rental Rate

Suburban 32 1,252,270 92 $12.22 Downtown 14 828,931 78 $10.02 Totals 46 2,081,201 85 $11.12

Source: Burns & Noble Commercial Real Estate Services

yler’s office market recorded 1999’s 75 percent occupancy rate to No new office construction is in the little change in 2000. Overall 74 percent in 2000, with an average pipeline for the near future. T occupancy rates decreased rental rate of $9.34 per square foot. In September 2000, the Musculosk- slightly from 86 percent in 1999 to 85 Marathon Oil Co. closed its 55,000- eletal Institute of Tyler opened on percent in 2000. The average rental square-foot office in fall 2000. The Golden Road. The $13 million, rate increased from $10.89 in 1999 to newly vacant space in One American 68,900-square-foot facility includes re- $11.12 in 2000. Tyler tenants continue Center more than doubled the amount habilitation facilities, conference to enjoy rental rates lower than most of available Class A space on the city’s rooms, exam rooms, physicians’ of- areas of the country. south side. Also during 2000, Sonat fices, two X-ray rooms, and leases According to Burns & Noble, the oc- Inc. closed its 50,000-square-foot of- space to the Ambulatory Surgery Cen- cupancy rate for Class A properties fice in Grand Centre. Together, these ter and Dynacare Laboratories. The fa- was 84 percent with an average rental closings are responsible for a decrease cility also houses one of only two cop- rate of $13.50 per square foot. Class B in occupancy for class A space in per-lined extremity MRI system rooms structures have an occupancy rate of 2000. located in Texas. 88 percent and an average rental rate Southwestern Bell added 24,000 of $11.14 per square foot. Class C square feet to its Tyler South Central buildings had a slight decrease from Office Building on Rice Road in 2000.

18 INDUSTRIAL MARKET

Industrial Property Statistics Average Vacancy Rate Rental Rate (in percent)

Bulk Warehouse $2.50 4 Manufacturing $2.50 3

Source: Burns & Noble Commercial Real Estate Services

Average Price Industrial Parks Available Acres per Acre

Candy Park 100 $100,000 East Texas Center 600 15,000 Negem Industrial Park 275 15,000 Pointe North 155 76,000 Southpoint Industrial park 65 50,000 Tyler Industrial Park 106 86,000 Bioscience Park 120 Under Construction

Source: Tyler Economic Development Council

ccording to Burns & Noble, Brookshire’s Grocery Company park has approximately 106 acres still Tyler’s industrial market is completed a $23 million expansion available. Steamatics is constructing A strong, with 2001 vacancy project at its Tyler distribution center office space on a one-acre site. The rates of 3 to 4 percent. Lease rates for in summer 2000. The 350,000-square- project was expected to be completed industrial space range from $2 per foot facility includes a new 300,000- in May 2001. In 2000, Meals on square foot for older metal buildings to square-foot refrigerated goods ware- Wheels purchased four acres for a stor- $3.50 per square foot for new indus- house and 50,000 square feet of age and production facility that should trial space. New flex space is being additional space for the frozen foods be completed within two years. Also in marketed at prices of $5 to $6 per distribution facility. 2000, the East Texas Food Bank pur- square foot. With little lease space Tyler Business Park is a 200-acre in- chased a 3.7-acre site and will con- available, many industrial tenants are dustrial park managed by the Tyler struct a storage facility. constructing freestanding buildings. Economic Development Council. The

19 CONCLUSION

yler is a growing community and Tyler residents are proud of the recreational areas and facilities such as an economic hub of East Texas. area’s history as a city focused around Faulkner Park and Glass Recreation T The area’s retail and medical fa- roses. This pride is evidenced by the Center will continue to enhance the cilities attract people from all over East city’s new Tyler Civic Theatre with a lifestyles of the city’s residents as well Texas. The city itself is growing in a terrace overlooking the Tyler Munici- as attract visitors from the surrounding southerly direction. Tyler’s economy pal Rose Garden and the new Rose areas. continues to remain strong with recent Rudman Recreational Trail. Other new expansions in its health care, manufac- turing, distribution and retail sectors.

701-25-1489

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