Building now for the digital future
There’s been plenty of anxiety generated around the rise of e-commerce and the broader impact of digital technologies on both commerce and culture, and rightly so. After all, hardly an industry or family has been left untouched in some way. The mobile phone is the new fireplace, the new newspaper, the new credit card.
In this week’s Texas Inc. we address those notes of caution, offering a wake-up call as well as some consolation that the future digital technology ushers in may not be quite so dire.
Chris Tomlinson starts us off with a look at the impact of digital technologies on the financial system, noting that the U.S. lags other countries in adopting mobile banking. He notes that global investment in fintech hit $55.3 billion last year, twice the level of the year before. One reason is that developing countries are adopting these technologies far faster than we are.
“When a customer has never had a home phone or traditional bank account,” he observes, “they leapfrog directly to digital and mobile alternatives.”
One company that is pushing in that direction is BBVA, the Spain-based bank whose North American chief executive, Javier Rodríguez Soler, set up shop in Houston earlier this year.
In a conversation with our Andrea Leinfelder, Rodríguez Soler said the bank, which started out primarily dealing with real estate clients in the U.S., had made a concerted effort to broaden out its offerings to expand its reach.
“We’ve done all this with the heavy use of technology,” he told her. “Basic transactions like depositing a check or looking for the account balance, that’s very easily done in a mobile app. We want our employees in the branches to help customers with value-added activity.”
Rodríguez Soler is cautiously bullish on the local economy, observing that despite handwringing about the potential for a downturn, “Houston and Texas will be better at coping with this potential recession because of their diversification and strength in the oil industry, which is more resistant toward downturns.”
Some of the diversification is being manifest in rings around Houston, as e-commerce and bricks-and-mortar find common cause.
The region’s industrial real estate market is booming, with developers putting up millions of square feet of warehouse space on spec as they anticipate demand for goods from online retailers such as Amazon.com will continue to increase unabated.
Contributor Danny King found that a recent spate of building has pushed the Houston industrial market to more than 430 million square feet, a 13 percent increase from five years ago. Of the 55 largest industrial markets, Houston now ranks No. 9. There are several reasons for the growth. The aforementioned e-commerce boom that’s impacted all U.S. industrial markets, the ongoing population increase in and around Houston, a ramp-up from the relatively quiet period that hit between 2014’s oil-price crash and Hurricane Harvey in 2017, and the region’s position as a hub that serves markets as far away as Austin and San Antonio.
Things change. Horses give way to cars, fireplaces give way to iPhones. New industries and opportunities arise — to fix cars, to create banking apps for handheld devices. And warehouses pop up to store all that real stuff we buy online.
Welcome to Texas Inc.