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2 weeks ago
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MCALLEN, Texas – Ralph Garcia, vice president of international business recruitment for McAllen Economic Development Corporation, has spoken about new industrial space being created on the north side of his city.
“As we continue to grow as a community, one of the challenges that we have on the south side, being close to the border, is availability of real estate. And so the City took the initiative on the north side,” Garcia explained.
“They purchased a 1,200-acre site along with the McAllen Foreign Trade Zone. The FTZ purchased an additional 211 acres and it’s right between an airport and an old military base.”
Moore Air Base is an inactive U.S. Air Force facility that was sold to private concerns and partially transferred to the Department of Agriculture.
“That airport is still used, so that’s a site that we’re promoting for new development, new projects,” Garcia said.
Garcia made his comments in an in-depth presentation to site selectors who were brought down to the Rio Grande Valley by the Council for South Texas Economic Progress. The event was held at the Forum by Regency in Pharr.
“We’re currently working on a project for a high-tech facility that’s being quoted out to several different construction companies in our area. It’s about us $50 million or $60 million project we’re excited about. We hope to get something going here pretty soon,” Garcia said.
Foreign Trade Zone
Garcia also spoke about the McAllen Foreign Trade Zone. He said it was established in 1968 and covers 800,000 square feet.
“The Foreign Trade Zone really was our community trying to establish a base for industrial developments. The Foreign Trade Zone still caters to a lot of our industry. If you’re bringing in raw materials from other parts of the world and you want to bring it into an FTZ without having to pay duties or taxes you can still do that,” Garcia said.
Some of the revenue the McAllen FTZ generates goes to McAllen EDC, Garcia explained. “Some of that we get to spend an economic development which is quite unique. It helps fund a lot of the things that we do.”
Development in Reynosa
Garcia said industrial development in Reynosa has helped McAllen. He said Reynosa has a population of about 1.2 million. He said this includes a manufacturing labor force of around 136,000.
“We have 14 industrial parks and about 200 plus companies operating there. A lot of growth. Last year we did about 300 million square feet in Reynosa in terms of growth.”
That said, the growth is not at the level currently being experienced in Monterrey, which is about three hours from McAllen, Garcia said.
“Monterey last year was about 18 million square feet of new industrial space. In one year. The year before that it was 15 million square feet. And a lot of that growth is attributed to what everybody knows as the phenomenon of nearshoring,” Garcia said.
“So, you have a lot of companies that are clustered. There’s a lot of Chinese companies in Monterrey. They are established there, and they tend to cluster close to each other. We saw this (develop) in the early 80s and the late 80s.”
At the same time, Reynosa saw an influx of Japanese manufacturers, Garcia said, such as Alps and Panasonic.
“Our market is pretty diverse in terms of manufacturers. You have a lot of automotive, you have electronics, medical,” Garcia said.
The advantage for manufacturers moving to Mexico, the MEDC leader said, is labors costs.
“The true value of being in Mexico is if you are labor-heavy. There has been a change over the years. You do see a lot more capital being invested in Mexico, a lot more automation but even without automation… Kimble Electronics is one of the companies we work with. Not too long ago they did an expansion of 215,000 square feet. They are adding about 3,000 jobs. But in that they are adding several lines. Each line is about $10 million, and it is fully automated.
Zoho Corporation
Garcia also spoke about Zoho Corporation, the software development company from India that is working out of the old McAllen public library on Main Street but has plans to build a big tech campus in the city.
“Zoho is one of our newer companies. Zoho has a great growth potential. They’re working and looking at other communities in our market as well for that growth. So, we’re excited about what they bring to the table with their high-tech jobs,” Garcia said.
Garcia then explained why Zoho landed in McAllen.
“They actually established in Austin first. They bought about 300 acres, set up a campus and went through that process. But they never got any attention. The community never talked to them. To this day, Austin city officials haven’t met with them. They have challenges occupying one of their own buildings, because they cannot get occupancy permits. That’s a challenge,” Garcia said.
“As they’re recruiting in their market, in Austin, they’re competing with Dell, they’re competing with Tesla, and they came to find a lot of the individuals (their workers) were coming from this region. And so rather than pick these people up and move them, they settled down here.
“They’re paying extremely good wages, and their employees are able to purchase a home here, as compared to Austin where they can’t afford it because the living wage is different.”
Recent projects
Garcia also spoke about some of the recent projects McAllen EDC has been working on,
“The requirement for industrial space is extremely important. Every community (in the Valley) is building right now. I think we have several industrial parks (being built) in all our communities. In McAllen, we recently announced the McAllen Nearshoring Industrial Park. It is a 120-acre site. We have McAllen Industrial South. And then we also have the Tres Lagos industrial development. That is geared more toward some of our companies that are doing high tech.”
Regional partners
Garcia said MEDC’s efforts are boosted by partnerships with groups such as South Texas Manufacturers Association, Rio Grande Valley Partnership, COSTEP, and Index. “We are part of the maquiladora association on the Mexican side, so we have access directly to those companies.”
Garcia also listed some of the consultants MEDC works with.
“A lot of activity comes from those partnerships that we have. We do the legwork. We don’t mind doing it. If you have a project that you have on the table that you want some advice on or are kicking around opportunities as to where (your client) might go, let us know. We can always put some information together and see if it’s helpful,” Garcia said.
“And then if those projects turn into a business, we work with you directly. It’s your clients or customer. We make sure that you’re focused in on, whether it’s a commission-based project or whatever it is, our job is to help you be successful with your customers.”
Garcia said McAllen EDC also works on leads provided by the state.
“We work with site selectors, any type of proposal, real estate, supply chain, whatever the case might be. Our job is to make sure that we provide you guys with the information you need.”
Garcia added: “Over the years we’ve worked with 166 expansions, over 200,000 jobs created, 726 new companies and those are both sides of the border. Because we do truly work both sides of the border. I am in Mexico a lot of my time. I have a gentleman that works with me on the Mexican side as well. We spend a lot of time there. That’s where the core of our business comes from.”
Editor’s Note: Here, below, is an audio recording of everything McAllen EDC Vice President Ralph Garcia said to visiting site selectors at COSTEP’s event at the Forum by Regency. With the exception of Garcia’s commentary on public safety. Click here to read and watch Garcia’s comments on public safety.
The post McAllen EDC vice president makes pitch to visiting site selectors appeared first on Rio Grande Guardian.
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