Experts say Dallas Region economy looks strong at DRC’s Year Ahead

By Catie George, Manager, Communications and Storytelling

At a recent Dallas Regional Chamber event, national experts gave insights into the Dallas Region’s economic outlook for 2024—and the year ahead looks promising.

Lynn Martin and Bob Sulentic

President of the New York Stock Exchange Lynn Martin and President & CEO of CBRE Group, Inc. Bob Sulentic gave credit to Texas’ business-friendly environment for how the state can weather periods of economic uncertainty at the DRC’s Year Ahead event, presented by OCC, on Thursday, Nov. 9.

“The environment that’s been created in the state of Texas has really allowed entrepreneurs to flourish,” said Martin, citing that Texas has 200 companies of the 2,400 listed on the exchange. “It speaks to the welcoming nature of the economic incentives accompanying Texas.”

While Texas enjoys a positive business environment, there are still challenges related to inflation. Higher borrowing costs have not only impacted residential real estate but also commercial real estate.

“We thought values would come down 15% to 20%. We now think they may be another 10%,” said Sulentic. “We also think that’s going to stabilize as we get into the middle of next year, that interest rates will come down. When interest rates come down and availability of debt is more certain, we think the capital will come back into the market, valuations will go back up, and assets will trade again.”

Encouragingly, Sulentic said that the challenges are only temporary.

“The property owners and lenders are all struggling with the same thing, which is uncertainty about values and uncertainty about where interest rates will settle at,” he said. “The buildings are still there, and the base of buildings are still growing and growing as the global economy grows. They have just stopped trading for a while. When the capital comes back, the assets will start trading again.”

While some were concerned about the current state of the economy and a possible recession, Sulentic and Martin emphasized there is no recession in sight.

The DRC’s Dale Petroskey, Ray Perryman of The Perryman Group, and the DRC’s Duane Dankesreiter at our VIP reception. Perryman was our featured speaker during the reception

“This is not like the Great Financial Crisis, this is not like what we saw in the 1990s. It’s more like, in my mind, when we saw the dot-com bubble burst,” said Sulentic.

Martin added that the whole U.S. economy was strong, not only Texas.

“The market is starting to very slowly reopen,” she said. “The strength of our U.S. markets, the ability to raise capital and liquidity, transparency and depth in those markets, we can’t lose sight of that.”

Martin and Sulentic also added that businesses that can adapt well will thrive.

“The volatility of change may ebb and slow, but change is constant,” said Martin. “As long as businesses can remain nimble and quarter to their North Star, the long-term businesses work out.”

The hour-long discussion left attendees with a positive outlook for the 2024 year.

“Many economists are surprised at the resilience of this economy,” said DRC President and CEO Dale Petroskey. “Here in the Dallas region, we continue to be a magnet for people and companies who want to move here. We’re growing more than any other market in the United States by far, and no sign is slowing down.”

Read more coverage about the event from The Dallas Morning News and Bloomberg.

Thank you to our presenting sponsor, OCC, and silver sponsors, Axxess and Forvis LLP.

To learn more about the work the DRC is doing, visit our website.