South Central

The South Central region has far and away been the biggest beneficiary of the tech exodus from Silicon Valley.

47 of them have moved to this region, and 44 of these have relocated specifically to Texas. Cities in the Texas Triangle have seen impressive growth as a result – office buildings here have high

occupancy levels and new commercial spaces have sprung up to accommodate all the new residents. The most recent Texas state budget shows a 10% increase in spending relative to the last year – half of that increase is due to education spending, while another third is for improving the state’s healthcare system.

The Texas Triangle continues to be one of the country’s most active regions. This has been true for the last several years and we expect it to be true for years to come. The overall outlook has not changed significantly since our last report – the market has grown dramatically and while the cost of living remains manageable, the cost of building has increased considerably. Nominal construction spending has more than doubled over the last ten years, but the labor force has only grown by about 30%. More projects competing for fewer workers means that workers can demand higher wages. This, in turn, has pushed labor costs up considerably. We expect this to continue for years to come as well.

Outside of Texas, data centers are being built across the Deep South. These can be built anywhere with cheap land, plentiful electricity, and lots of water access – things that states like Louisiana and Mississippi have in spades. As commerce continues to move online, demand for these facilities has only accelerated. New projects are announced each week, making it difficult for contractors to keep up.

* Other structures include religious buildings, amusement, government communications, and public recreation projects.
Source: BuildMarket

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