Dallas-Fort Worth is now a “gateway market” » Dallas Innovates

Dallas-Fort Worth is now a “gateway market,” says Hillwood’s Bill Burton, who predicts the region will experience continued industrial growth for many reasons. Population centers, inland ports, airports and seaports are key drivers of industrial growth – and “DFW has three of these four components”.

Burton is a Hillwood executive who oversees the vision and strategy of AllianceTexas, which recently surpassed $100 billion in the economic development of the region, according to a press release from the company. Alliance is currently home to 559 businesses and over 53 million square feet of office, retail and industrial space, the latter being the largest industrial submarket in the region.

Alliance is also at the forefront of transportation technology developments in the Mobility Innovation Zone, or MIZ, which includes drone testing, autonomous trucking and autonomous movement of goods. Improvements in transportation and infrastructure are essential, according to Burton, to keep DFW’s economic engine running at full speed.

Burton, Executive Vice President of Hillwood, is among the experts invited to share their thoughts on the CRE market for our recent DALLAS® magazine which focused on how DFW is punching above its weight in commercial real estate. Here’s what he had to say in our “View from the next level”.

What are the main reasons why North Texas is one of the fastest growing markets in the nation for commercial real estate today?

People underestimate the size and diversity of North Texas’ economy. The GDP of North Texas is approximately $615 billion and the GDP of the state of Texas is approximately $1.7 trillion. If we treated North Texas as a state, it would be the ninth largest economy in the United States. As a country, North Texas would be the 24th largest economy in the world. Finance, insurance, healthcare, technology, manufacturing, and energy are all major industries in the region. Combine the strength and diversity of North Texas with favorable tax policy, affordable housing, significant infrastructure investment, a highly skilled workforce, and a government that helps businesses grow, and you’ll begin to understand why DFW is a popular place to relocate. and businesses to thrive.

What are the main factors affecting the region’s status as a top market for industrial development?

North Texas is now an inland port with the Union Pacific Railroad Intermodal Facility in South Dallas and the BNSF Railroad Intermodal Facility in Fort Worth at AllianceTexas. The BNSF intermodal facility is now the busiest intermodal operation in their system with over one million lifts per year. DFW and Alliance Airports are adding huge expedited air freight capacity with FedEx, UPS and Amazon Air hubs.

DFW is also growing extremely rapidly and there is a direct correlation between a region’s population and industrial demand. Because we are a large consumer market and a large producer market, we also benefit from a more cost-effective transportation model, which allows us to serve a larger area, creating greater demand. The rapid growth of e-commerce will also continue to increase this demand.

We have all felt the disruption of various supply chains over the past two years. The shock we have all experienced has also led to an increase in demand for safety stocks, another term for stocks, which has further increased the demand for industrial real estate.

Another major driver of growth will be local reshoring and offshoring for various industries and manufacturing operations. North Texas will benefit from manufacturing operations that locate their facilities in Texas, such as the recently completed Stanley Black & Decker facility or the announced MP Materials facility, both housed at AllianceTexas.

What should we invest in as a region for continued growth?

While the factors contributing to DFW’s continued industrial growth are many, we must remain focused on the factors that can trip us up. As we look to the future, we must remain focused on our infrastructure investments. North Texas has done a good job compared to the rest of the country, and we can’t take it easy. The quality of life we ​​enjoy and the relative ease of doing business are tied to the quality of our infrastructure. As we continue to increase the population and shift more to an electric economy, we absolutely need to invest in the electricity grid and diversify the energy supply.

How is education factored into the DFW growth equation?

We also need to invest in our schools and better connect businesses with students from an early age. Unless children understand what jobs may be available, it is difficult for them to understand what opportunities are available and how to set goals in order to take advantage of them.

What technology trends are dictating the future of the industrial space?

We firmly believe that technology will change the industrial supply chain. Three years ago, we created the Mobility Innovation Zone (MIZ) at AllianceTexas to be at the forefront of technology and transportation innovation happening on the ground and in the air.

Transportation accounts for approximately 50-70% of supply chain costs. Even small improvements can mean hundreds of millions of dollars in savings and improved efficiency. Autonomous trucking has arrived. Every day, we come across trucks that operate autonomously. While they can currently have a human in the cabin, that will eventually change over time.

At AllianceTexas, we have completed the first installation in creating the TuSimple Autonomous Freight Network. TuSimple has now logged over 160,000 self-contained miles for UPS’s North American freight division.

Beyond autonomous trucking, what impact will the technology have on the supply chain?

In addition to autonomous long-haul trucking, we believe that autonomous movement of goods will occur inside intermodal terminals, and we will soon see autonomous movement of trailers and containers from the intermodal facility directly to the buildings of individual warehouse. The efficient and timely movement of goods will have a significant positive impact on the cost and efficiency of operations.

We are working hard with pioneering companies, technology providers and emergency management offices, as well as the various regulatory agencies that will all help determine the evolution of the autonomous movement of goods.

This is a very exciting time in the industry, and we are fortunate not only to have a front row seat, but to be able to participate in the evolution that will have a significant impact on the future of our industry and our region.

Quincy Preston contributed to this report.

This interview has been edited for brevity and clarity.

A version of this story first appeared in the print edition of DALLAS® Commercial Real Estate 2022, published by Dallas Next for TREC and the Dallas Regional Chamber. Read more in the digital edition of the magazine below, and request the next print edition here.

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The real estate magazine is part of the DALLAS® media platform that includes the DALLAS® Relocation and Newcomer’s Guide to DALLAS® Guide to economic development. Posted by Dallas Next for the Dallas Regional Chamber, Together They speak to the world about the future of living, working, learning, and playing in North Texas.

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  • TuSimple has been running its operations from its 2.5-acre logistics center in AllianceTexas since last June. Its massive new MIZ facility will serve as the origin and destination facility for TuSimple’s L4 self-driving trucks, featuring bi-directional launch and landing pads.

  • The expanded collaboration will lead to multiple pilot trials of robotic cargo on I-45 between Fort Worth and Houston “along the same path” as those conducted in 2021. The two companies plan “to complete fully autonomous transportation in Texas in the next years”. years.”

  • MP's new magnetic facility in the AllianceTexas development of Fort Worth will source materials from Mountain Pass, Calif., and is intended to help restore a fully integrated US supply chain. [Rendering: MP Materials]

    The new magnet manufacturing plant will be the headquarters of MP Magnetics, the company’s growing magnetics division. Output from the new facility could eventually power 500,000 EV motors each year. MP, which has a long-term supply agreement with General Motors for rare-earth materials and parts, said manufacturing could begin in 2023.

  • In partnership with Silicon Valley logistics technology company Phatnom Auto, ITS ConGlobal is exploring how workers can train and operate heavy machinery remotely.

  • Built on the legacy of Hillwood, MIZ is a hub of innovation in land and air mobility.

  • The Transportation Institute will serve as the surface and air mobility technology think tank at AllianceTexas, conducting research, managing strategic initiatives and helping shape innovations that will change the way we live.