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HomeMy WebLinkAboutEDA 2023-11-09 Agendas t4RH NOKTH KICH�AND HILL CITY OF NORTH RICHLAND HILLS ECONOMIC DEVELOPMENT ADVISORY COMMITTEE AGENDA 4301 CITY POINT DRIVE NORTH RICHLAND HILLS, TX 76180 THURSDAY, NOVEMBER 9, 2023 REGULAR MEETING: 11:30 AM Held in the Council Workroom A. CALL TO ORDER B. PUBLIC COMMENTS An opportunity for citizens to address the Economic Development Advisory Board on matters which are scheduled on this agenda for consideration by the Board, but not scheduled as a public hearing. In order to address the Economic Development Advisory Board during public comments, a Public Meeting Appearance Card must be completed and presented to the recording secretary prior to the start of the Economic Development Advisory Board meeting. C. ACTION ITEMS C.1 Approve Minutes of the July 19, 2023 Economic Development Advisory Committee meeting. D. DIRECTOR'S REPORT D.1 Update on Local and Regional Economic Trends D.2 Development Trends (commercial, residential, multi-family) D.3 New and Upcoming Business Report E. PROJECT AND PROGRAM UPDATES E.1 Street Bond Project Update Thursday, November 9, 2023 Economic Development Advisory Committee Agenda Page 1 of 2 E.2 City Point Development Update E.3 Transit Oriented Development Update EA Davis Boulevard/Boulevard 26 Neighborhood Empowerment Zone F. ADJOURNMENT Certification I do hereby certify that the above notice of meeting of the North Richland Hills Economic Development Advisory Board was posted at City Hall, City of North Richland Hills, Texas in compliance with Chapter 551, Texas Government Code on Friday, November 3, 2023 by 3:00 PM. Traci Henderson Assistant City Secretary This facility is wheelchair accessible and accessible parking spaces are available. Requests for accommodations or interpretive services must be made 48 hours prior to this meeting. Please contact the City Secretary's office at 817-427-6060 for further information. Thursday, November 9, 2023 Economic Development Advisory Committee Agenda Page 2 of 2 IrLp NOKTH KICHLAN HILLS ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MEMORANDUM FROM: Craig Hulse, Director of DATE: November 9, 2023 Economic Development SUBJECT: Approve minutes of the Economic Development Advisory Committee meeting. PRESENTER: Craig Hulse, Director of Economic Development SUMMARY: The minutes are approved by majority vote of the Economic Development Advisory Committee. GENERAL DESCRIPTION: The Economic Development department prepares action minutes for each Economic Development Advisory Committee meeting. The minutes for the previous meetings are prepared and provided for review of the Committee. Upon approval of the minutes, an electronic copy will be uploaded to the City's website. RECOMMENDATION: Approve minutes of the July 19, 2023 Economic Development Advisory Committee meeting. MINUTES OF THE ECONOMIC DEVELOPMENT ADVISORY COMMITTEE OF THE CITY OF NORTH RICHLAND HILLS, TEXAS HELD IN THE COUNCIL WORK SESSION ROOM, 4301 CITY POINT DRIVE July 19, 2023 The Economic Development Advisory Committee of the City of North Richland Hills, Texas, met on the 19th of July at 11.30 a.m. in the Council Work Session Room. Present: Mr. Joshua Fichter Five Star Ford Mr. Jay Garrison JA Garrison & Associates Mr. Jay Redford CBRE Commercial Mr. Mark Wood Howe/Wood & Company Ms. Mindy Monroe Legend Bank Ms.Darlisa Diltz NTEEC Mr. Curtis Nash Grace's Tiers Bakery Absent: Mr. Mikhail Orlov GRITR Ms.Stephanie Seybert SeyTec Mr. Mark Deno Medical City North Hills Staff Members: Mr. Craig Hulse Economic Development Director Ms. Elizabeth Copeland Economic Development Analyst Ms. Paulette Hartman Deputy City Manager Ms. Kelly Vaughn Administrative Secretary A. CALL TO ORDER Chairman Wood called the meeting to order at 11.36 a.m. B. CITIZEN'S PRESENTATION / PUBLIC COMMENTS No citizens present for public comments. C. APPROVAL OF MINUTES OF THE February 15, 2023, MEETING APPROVED A MOTION WAS MADE BY MR. REDFORD, SECONDED BY MS. MONROE TO APPROVE THE MINUTES FROM THE AUGUST 4, 2022, MEETING. MOTION TO APPROVE CARRIED 7-0. July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 1 D. INFORMATIONAL ITEMS DA Introduction of New Member to Economic Development Advisory Committee Mr. Hulse took the time to have all the members do quick introductions and then explained that we received notice a few months ago that Mike Vasquez was moving due to a new job opportunity, prompting the opening of his seat. Last month Curtis Nash, was proposed to City Council and approved to join EDAC for the remainder of Mike Vasquez's term. Mr. Nash was given the chance to introduce himself. Mr. Nash is originally from Fort Worth, born and raised here, then lived in North Carolina during his college years. He was fortunate to play professional basketball for 10 years before he retired. He has a daughter now and is also the CFO and co-owner of Grace's Tiers Bakery. E. ECONOMIC DEVELOPMENT DIRECTOR'S REPORT Mr. Hulse presented a high level of what is going on in the community, specifically from an economic standpoint. EA Update on Local and Regional Economic Trends Local unemployment is down. Currently in North Richland Hills it is 3.5%. We are a half percent below DFW, and we are at the same level as the United States of 3.5%. In a good economy, unemployment ranges between 3 and 4%. So, unemployment is good right now. However, consumer prices and inflation are up 5% in DFW. Last year it was 9%, so between 2021 and 2023, inflation is up 14% in DFW. Signs are starting to indicate that inflation is subsiding. Fed Fund Rate remains at a 15-year peak (at 5.25%) up 3% from a year ago. As of July 6, the 30-year mortgage rate is at 6.8%. slightly down from its 20-year peak of 7% in November 2022. Consumer confidence is slightly up from this time last year but remains down 20% from 2 years ago just before inflation started to increase. Local sales are up almost 6% over the previous year. Single family property values are holding steady, while commercial property, specifically, office property is being challenged. The economy continues to expand modestly as employment and wage growth rises. However, uncertainty exists due to diminishing demand, higher labor costs, the rising cost of credit, and inflation. North Richland Hills continues to lead NE Tarrant County in single family starts, 8 years going, but down 50% over the last year. Nearing full build out, available land for development is becoming scarce. The COVID single family remodel burst has passed. On the commercial side, permitting is steady as most permits involve the upgrading or renovating of existing commercial property. July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 2 Mr. Hulse asked Chairman Wood to comment specifically on new single family permitting. Mr. Wood said that traffic is coming in from all over the country and that NRH is a prime location. The problem is Northeast Tarrant County is running out of land. There is more and more redevelopment, and as well, now contractors are finally being able to develop hard sites that have been left undeveloped for various excuses for a long time. Just recently, Mr. Wood's Company finished Rumfield Estates, 27 residential lots and a commercial corner lot. The houses have sold very fast. People want to be in that area of the city and there are not enough options. Mr. Fichter had a question. He said the city has done a great job revitalizing the northeast corner of Rufe Snow with the new stores that are coming in and yet it spent many years empty. His question was if the government offered incentive to get rid of concrete and bring back trees and greenery? He went on to question are there areas in the Northeast where commercial properties have not been revitalized where they could be turned into potential land for growth? Mr. Hulse asked Paulette Hartman to respond to this question. She responded first by saying that the city does not develop anything. However, for a city of our size, North Richland Hills has one of the highest percentages of parkland and preserved green space. And yet the city will not be in the business of buying vacant properties and preserving them because that is not how the city's money is to be spent. Mr. Fichter responded with the intent to clarify his original statement. Could the city possibly identify areas they are not redeveloping and get them in front of builders and say here is an opportunity that we will rezone for you so you can add inventory for more single-family homes? Paulette responded saying that City Council is in the process of creating an empowerment zone. Staff right now is working on getting all the policies together that will alleviate certain requirements in that older area to incentivize development. Up until this point, the cost of redevelopment there has been too high because of all that must be done to a building and or parking lot to bring it into compliance with current rules. Mr. Hulse said that his Economic Development team is on this task force and is looking forward to presenting this Empowerment Zone to the Advisory Council. It takes a lot of work and requires a lot of guidance from City council. This time next year he hopes to have something very exciting that will activate the areas of Davis and 26 that will not only make the existing businesses and property owners excited but investors as well. E.2 Development Trends (commercial, resident, multi-family) Existing single-family housing is down about 9% in North Richland Hills. It is down about 26% across the country which is a testament to the attractiveness of our region, that people are willing to come here, however they just are not selling right now. Values continue to hold steady and that is unique to Texas. There is also some new terminology that you are going to hear for the first time. The first is called the "Lock-in Effect". This is explained basically by 71% of existing homeowners are reluctant to move because they can't afford to give up their low mortgage rate of 4% or less. The second one is okay, I must move but I am a July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 3 homeowner, so I become an "accidental landlord". This person opts to rent their home and maintain their low interest rate to profit off increased demand for rental housing. The rate of first-time homebuyers is at historical lows right now. It is only 24% in 2023 versus 40%, just ten years ago. Those age 55 and older represent 55% of all purchase transactions. From a commercial real estate standpoint, the city is doing well. Retail vacancy is currently down almost 3% from last year, while rents are up 3%. Currently 8%, retail vacancy peaked at 14% during the pandemic. As expected, the office vacancy bug is beginning to hit the city. While we've benefitted from the demand from downtown to suburban office, one of the larger office businesses, Stericycle, representing 128,000 square feet has vacated their space. There's a significant bubble of distressed office real estate that is waiting to burst as remote work has reduced the demand for office, which is now impacting leases and lease renewals, while the landlords grapple with loan obligations. Regarding Local Taxable Sale Trends, North Richland Hills is doing well. From just a tax sales tax receipt, we are up over 5.5% year after year. Dialing it down to different sectors within brick and mortar, it is the deep discounting stores that are doing best, such as Sam's and WinCo. Home Improvements are flat right now, as are apparel and soft goods. Discretionary spending is down while online shopping continues to soar. On a spectrum of where we fit in Northeast Tarrant County, we are at 5.5. Euless and Southlake are down 1%. Hurst is up 1%. Keller, Bedford, and Watauga are up 4%. Colleyville is 4.5% Haltom is 5.5% and Grapevine is 10%. E.3 New and Upcoming Business Volli Entertainment selected their first Texas location for North Richland Hills at the former Hobby Lobby location. Currently under construction, the 66, 000 square ft building will play host to the largest indoor pickleball/sports bar/adventure park in the county. The family friendly megaplex will offer 7 competitive pickleball courts, an arcade, golf simulators, plus a kid friendly adventure park alongside a restaurant and bar. Currently under construction, Volli is expected to open late spring, early summer. Pickleball has grown so rapidly in the past few years. More than 36 million in the U.S. play pickleball, up from just 5 million in 2021. LeBron James, Tom Brady and Kevin Durant have all invested in professional pickleball leagues. Volli sponsors professional players that tour the country. We have another potential pickleball facility being considered right now in the city. And you have probably heard that Chicken and Pickle is opening a third location in DFW and Allen. EoS Fitness, a Dallas based fitness organization with over 100 gyms across California, Arizona, Texas, Nevada, Utah, and Florida, is coming to NRH. In addition to weights, cardio machines and fitness classes, the facility will include a pool, sauna, recovery room and even a towel service. July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 4 This is a long time coming for this 59,000 square foot vacant property as Tom Thumb Grocery was still under lease until last year. EoS Fitness is expected to open late 2023 early 2024. Three popular businesses are coming to North Richland Hills. Popshelf, Five Below, and Ross Dress for Less have all signed leases to occupy the 46,000 square foot former grocery/church building located at 5196 Rufe Snow next to the WinCo grocery store. A significant renovation is taking place breathing new life into the 40-year-old property. Expected completion is late 2023. Caddo office spaces is trying to grow the trend of executive suites and flex office space. They are going in the southeast corner of Davis and North Tarrant Parkway. Their motto is get stuff done and be home for dinner. They are going to be constructing a two story, 38,700 square foot building of 160 executive suites that have some meeting space and coworking space with three different levels of membership with the lowest starting at $549 a month. They will be in front of B & B Theaters, taking up a few acres, just north of Brahms. After taking a long hiatus due to issues with supply chain and rising construction costs, Braums plans to start construction again early next year. On Wednesday, June 28t", Peppa Pig, visited NRH to kick off the construction of Peppa Pig Theme Park Dallas Fort Worth. The new park will be located at the former Mountasia Family Fun Center on Boulevard 26 next to the NRH2O Family Water Park. Mayor Trevino and members of the City Council joined Peppa for the morning's groundbreaking, along with officials from Hasbro, owner of the Peppa Pig Brand, and Merlin Entertainments, who will build and operate the park. Opening in 2024, this will be only the second Peppa Pig theme Park in North America with the other one in Florida. The $26 million investment by Merlin will bring 100 new full and part time jobs to North Richland Hills. Hiring will start later this year. And finally, to wrap up new businesses, the former Rooms to Go North Hills Village that turned into Overstocks and Bargains that fronts Loop 820 directly across the street from City Point, will now be Seconds & Surplus. This is a 48,000 square foot space that will offer customers a wide selection of quality home improvement products at discount prices, with excellent customer service. Not only is this a good business that occupies space and provides services to the community, but it also helps renovate homes. F. PROJECT AND PROGRAM UPDATES F.1 Street Bond Project Update July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 5 Mr. Hulse updated the members on the $49 million NRH bond package voted on in 2020 and gave progress on all major streets and where they are on the timeline towards completion. There is a lot of construction all around the city right now and it's not friendly, but it will look great when it is done. During the month of May, the city was awarded a $4.2 million grant from the Economic Development Administration, the largest grant in North Central Texas for the Cares Act, that went to the cities for public infrastructure. F.2 City Point City Point is Tarrant County's first major mall redevelopment, that when complete will be Home to 2,500 new residents and numerous new businesses. Model homes have been built and the first homeowners are beginning to move in. Homebuilders Mattamy Homes, Ashton Woods and CB Jeni offer a diverse mix of detached and attached homes that are two to three stories, ranging in price from the mid-300's to the low 500's. The Delegate at City Point, a 4 -story multifamily project, began construction at the beginning of 2022 and is expected to be available for lease in early 2024. The commercial area is the centerpiece of City Point Drive. Master Developer Centurian American and NRH City Staff are in the final stages of review with the first phase set to start construction in 2023. F.3 Transit Oriented Development TexRail ridership is up 25% over the last year. Last year was the first year, post pandemic, where there were no interruptions and people were out and about. Smithfield is the third most used station behind downtown Central station and Grapevine Main. Last month City Council had the opportunity to review a project by Presidium and approved the zoning forthis 4 story, high quality 298 unit multi-family project. This also includes 20,000 square feet of commercial fronting Main Street and surrounding Back 40 Barbeque. Another project percolating right now is on the west side of Smithfield Road, directly north of Mid Cities. It is a 300-unit project with 18,000 square feet of commercial right at the station. This one includes a structured parking deck. That adds a high cost to the development and is only achieved when you have high rental rates. What this communicates is that the projects that are coming into North Richland Hills rival what you see in downtown Fort Worth. Since 2019, There have been 157 single-family homes and 619 multi-family units that have been constructed near the Iron Horse station. The average single family home value is over $425,000 while the multi-family rents are over$1.90 per square foot. Multi-family occupancy is over 95%, while the newest project Iron Crest, surrounds the station with a waiting list. There is 10,000 square feet of retail commercial about to become available as part of the Iron Crest development. G. LEGISLATIVE UPDATE July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 6 GA 88T" Texas Legislative Session There are two bills that Mr. Hulse wanted to draw attention to and the first one is The Regulatory Consistency Act. This bill is a one size fits all approach to provide consistency across the State. The city cannot adopt or implement any ordinances that are counter to anything that has been adopted at the State level. We must adhere by the State. The bill is vague, and we are unsure at this time how this will have impact in our city. The second one is regarding property tax relief. The State identified $18 billion in school property tax cuts. $5.3 billion will benefit homeowners through increasing their Homestead Exemptions from $40,000 to $100,000. The remaining $12.6 billion will benefit commercial property owners, business, and homeowners through reducing the school tax rate by 10.7 cents per $100 valuation. There will be relief on individual tax bills and it will be interesting to see how this trickles down to the business community. These bills will be on the ballot in November. H. ADJOURNMENT Chairman Wood adjourned the meeting at 12.50 PM. Mark Wood, Chairman Craig Hulse, Secretary July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 7 July 19,2023 Economic Development Advisory Committee Meeting Minutes Page 8