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Posted by: In: Industry Insights 10 Jul 2012 0 comments

(CNBC.com) Texas has done it again. The Lone Star State makes a triumphant return as America’s Top State for Business—its third time at the top of our rankings.

“Listen, there is a reason that Caterpillar [ CAT 82.30  +0.91 (+1.12%) ] moved their hydraulics manufacturing and their engine manufacturing to the state of Texas,” said Gov. Rick Perry in November during the CNBC Republican presidential debate.

We can attest to that.

In our sixth annual study, Texas racked up an impressive 1,604 points out of a possible 2,500, with top-10 finishes in six of our 10 categories of competitiveness. Texas has never finished below second place since we began the study in 2007.

Each year, we score all 50 states on the criteria they use to sell themselves. This year’s analysis is the most comprehensive yet, using 51 metrics developed with the help of the National Association of Manufacturers and the Council on Competitiveness, as well as input from the states themselves.

This year’s categories and possible point totals are:

  • Cost of Doing Business (350)
  • Workforce (350)
  • Quality of Life (350)
  • Infrastructure & Transportation (325)
  • Economy (325)
  • Education (225)
  • Technology & Innovation (225)
  • Business Friendliness (200)
  • Access to Capital (100)
  • Cost of Living (50)

This year’s study comes amid slowly improving fortunes for the states. A recovering economy coupled with lingering fiscal restraint following the Great Recession are helping states improve their finances for the first time in years.

“Revenue performance remains positive, expenditures in most states are stable and few states have faced mid-year budget shortfalls in fiscal year 2012,” the National Conference of State Legislators reported in May. That means states can resume their focus on the battle for business — and jobs.

In addition to the top spot overall, Texas has the nation’s best Infrastructure, according to our study. It improved to second place for Technology and Innovation, and boasts the third lowest Cost of Living. The state’s Workforce improved to seventh best from 14th last year. Access to Capital declined a bit, but Texas still finished in the top 10 (eighth). Perhaps most impressive, the Texas economy recovered from a rare stumble last year, when it finished 14th in the category, improving to fifth this year.

Texas endured a wrenching budget crisis last year. While the state is still not out of the fiscal woods, it managed to emerge with its sterling, triple-A bond rating and stable outlook intact.

The state had to make some sacrifices though, and that hurt in some categories. Texas comes in 26th inEducation and 35th in Quality of Life. And while the state held the line on income taxes, the overall tax burden — including property and sales taxes — is high. That hurts Texas in the all-important Cost of Doing Business category, where it comes in 28th.

Since we began ranking the states in 2007, Texas and Virginia have traded places each year in first and second place. But the pattern was broken in 2012.

This year’s runner up is not Virginia but Utah, which surged from last year’s eighth-place finish. The Beehive State boasts low costs (11th lowest for Cost of Doing Business, sixth for Cost of Living), a world class Workforce (ninth place) and moves into the top 10 for Quality of Life. The state has seen an impressive influx of venture capital of late, jumping ten places to 13th for Access to Capital, and its Infrastructure improved to eighth place this year.

Virginia: Road to Trouble

So what happened to Virginia — last year’s top state?

The Commonwealth is still a contender, finishing a solid third overall. But it faltered in two categories in particular: Infrastructure and Economy.

Infrastructure — specifically the state’s perpetually clogged highways — has long been an issue in fast-growing Virginia, and there is fresh evidence this year that the state is having trouble keeping pace. With some of the country’s toughest commutes, the state dipped to number 33 in the category, down from 10th a year ago.

Virginia’s economy remains in the top tier. But it has suffered in part due to circumstances beyond its control. The state’s proximity to Washington, DC has helped in previous years. Late last year, however, Moody’s slapped a negative outlook on Virginia’s otherwise pristine bond rating because of the federal government’s fiscal crisis. That contributed to Virginia slipping to 10th from eighth in our Economy category this year.

While still the envy of most states, Virginia declined in a total of six categories in 2012. The other four are Cost of Doing Business (32/21), Education (13/6),Technology & Innovation (14/11) and Business Friendliness (4/3). In this competition, you can’t post that many declines and stay on top — or, it turns out, finish second either.

Top Five: Ins and Outs

Rounding out the top five winners are one perennial favorite and one newcomer.

Fourth-ranked North Carolina is often a contender, thanks in large part to its well-educated workforce. This year, more of those workers are available. It’s a silver lining to a jobs crisis that has disproportionately affected the Tarheel State, where unemployment is considerably higher than the national average.

Cracking — or should we say fracking — our top five ranking for the first time is North Dakota, where an oil and gas boom fueled by the state’s Bakken Shale formation shows few signs of easing. Improving to fifth overall from 13th place last year, North Dakota boasts the fastest growing economy in the country. Unemployment is practically non-existent. But there are indications North Dakota’s success is more than just a flash in the oil pan.

The state moves up in Quality of Life (5) as well as Business Friendliness (4), which measures the states’ legal and regulatory climates.

But all is not Zen in the Peace Garden State. North Dakota still lags when it comes to Technology & Innovation (47) and Access to Capital (43).

Dropping out of the top five this year are Georgia (9/4) and Colorado (8/5). Georgia lost ground in the Education category, while in Colorado the Cost of Doing Business rose.

This year’s most improved state is Idaho, which climbed a whopping 18 spots to finish 13th overall. Like most of the country, Idaho’s economy has returned to more solid footing. But the state’s business costs improved as well, thanks to low wages and utility costs.

The biggest decline came in Massachusetts. A top-five finisher in 2010 and in sixth place last year, the Bay State tumbles all the way to 28th place this year. Still a top state for Education (3) and a magnet for capital (tied with California for No. 1 inAccess to Capital), the Massachusetts economy nonetheless faltered, dropping to 21st from 15th.

Also in the New England state, the Cost of Doing Business rose (49/41), and Infrastructure crumbled (45/29). Even in Technology & Innovation (7/3), the state that practically invented the high-tech corridor lost ground.

This year’s bottom state for Business, for a second straight year, is Rhode Island. The state finishes at or near the bottom for Infrastructure (50), Economy (49) and Business Friendliness (49). It’s an expensive state in which to do business (45) and to live (44). The state also plunged in the Workforce (46/26) rankings.

But perhaps owing to the adage “buy low, sell high,” Rhode Island is seeing a small surge in investment, moving up in Access to Capital (10/35).

How does your state stack up? Check out our complete rankings. And just as you do every year, be sure to tell us what you think.

To view the CNBC.com article, click here.

Posted by: In: Rockspring News 25 Jun 2012 0 comments

Rockspring Capital, a privately-owned real estate investment firm based in Houston, announced today that an affiliate has acquired a commercial land tract in Rosenberg, Texas.

The Rosenberg commercial reserve is a 10-acre property located at the northeast corner of FM 2218 and Town Center Boulevard. It is part of the larger Brazos Town Center development, which is strategically positioned as the gateway to the rapidly growing towns of Rosenberg and Richmond. FM 2218 is also currently undergoing expansion from US 59 to FM 762, which will greatly increase traffic flow to the corner site.

“This is a great investment as it was obtained with all-cash at a substantial discount from its actual market value. The property promises a nice return for our investors because it’s situated in an excellent location, which is in high demand from many commercial users,” said Jim McAlister IV, President and CEO of Rockspring Capital.

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About Rockspring Capital

Rockspring Capital is a Houston-based land investment company founded in 1973, whose strategy is to acquire opportunistic land parcels and residential lots in high growth areas.  It also makes special situation bridge loan and note purchases on land-related assets.  Rockspring Capital acquires with all cash in markets within the “Texas Triangle” – Houston, Austin, San Antonio and Dallas/Ft. Worth. For more information about Rockspring Capital, visit www.rockspring.com.

Posted by: In: Rockspring News 22 Jun 2012 0 comments

Rockspring Capital, a privately-owned real estate investment firm based in Houston, announced today that it will support the Southern Texas Professional Golfers’ Association (STPGA) and its upcoming Charity Golf Summer program.

The STPGA Charity Golf Summer program is a series of 100-hole golf marathons conducted by STPGA Professionals, each of whom solicits per hole pledges from club members, friends and others. Kicking off in June and running through the end of August, it is anticipated that the second year program will have as many as 40 STPGA Professionals participate from some of the finest golf clubs and facilities in the region. Last year, the program generated nearly $50,000 for the STPGA Foundation and many other deserving charities which were chosen by participating STPGA Professionals.

“Rockspring Capital is very excited to partner with and support a fantastic organization like the Southern Texas PGA”, said Jim Hynes, Managing Director of Rockspring Capital. “We look forward to helping make this great charity even better and cannot wait to get out there for some of the golf marathons.”

“The Southern Texas PGA’s Charity Golf Summer Program will impact thousands of lives in a very positive manner, and we are thrilled that Rockspring Capital has committed to be the sole sponsor of this effort,” said STPGA Executive Director Mike Ray. “Every fundraising endeavor has costs, but thanks to their generous support virtually every dollar raised by our professionals will go directly to charity.”

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About Rockspring Capital

Rockspring Capital is a Houston-based land investment company founded in 1973, whose strategy is to acquire opportunistic land parcels and residential lots in high growth areas.  It also makes special situation bridge loan and note purchases on land-related assets.  Rockspring Capital acquires with all cash in markets within the “Texas Triangle” – Houston, Austin, San Antonio and Dallas/Ft. Worth. For more information about Rockspring Capital, visit www.rockspring.com.

About PGA Southern Texas Section

The Southern Texas Section of the PGA of America is comprised of over 800 golf professionals representing over 200 facilities in Southern Texas. Our geographic area includes Beaumont, Houston, Bryan-College Station, Austin, San Antonio, Corpus Christi and the Rio Grande Valley. The purpose of our organization is to promote enjoyment and involvement in the game of golf, and to contribute to its growth by providing services to golf professionals and the golf industry.  For more information about the PGA Southern Texas Section, visit www.stpga.com.

Posted by: In: Rockspring News 04 Jun 2012 0 comments

Rockspring Capital, a privately-owned real estate investment firm based in Houston, announced today the quick sale of 46 of the 117 finished or fully entitled residential lots in New Braunfels, Texas, by one of its affiliates.  The property was acquired just four months ago in January.

The sale was made on behalf of Rockspring Capital’s seventh fund, Opportunity Land Fund No. 7, L.P. The residential lots are located near the intersection of Seguin Avenue and Klein Road. In addition, they also signed a binding Purchase and Sale Agreement for the remaining 71 residential lots which are scheduled to close in February 2013.

“This transaction is yet another testament to the success of combining Rockspring Capital’s cash acquisition strategy with our unique local market expertise,” said Jim McAlister IV, President and CEO of Rockspring Capital. “Residential lots are in scarce supply and high demand throughout Texas, but we were able to identify and seize this opportunity well before the competition in order to reward our investors.”

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About Rockspring Capital

Rockspring Capital is a Houston-based land investment company founded in 1973, whose strategy is to acquire opportunistic land parcels and residential lots in high growth areas.  It also makes special situation bridge loan and note purchases on land-related assets.  Rockspring Capital acquires with all cash in markets within the “Texas Triangle” – Houston, Austin, San Antonio and Dallas/Ft. Worth. For more information about Rockspring Capital, visit www.rockspring.com.

Posted by: In: Rockspring News 22 May 2012 0 comments

Rockspring Capital, a privately-owned real estate investment firm based in Houston, announced today that an affiliate has provided a $7.8 million bridge loan to the new operator of the Harborwalk project, a 550-acre master planned community in Hitchcock, Texas.

The Harborwalk property includes several hundred developed and undeveloped lots, a sales office, a marina which can be expanded, a retail store, a swim center and a yacht club with a restaurant. In addition, 400 acres of land which can be further developed and millions of dollars in municipal utility district receivables were included in the deal.

“We continue to make generational investments in Texas land due to the dislocation in the lending markets, and this loan promises a nice return for our investors because of its high interest rate and low loan to value attributes,” said Jim McAlister IV, President and CEO of Rockspring Capital.

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About Rockspring Capital

Rockspring Capital is a Houston-based land investment company founded in 1973, whose strategy is to acquire opportunistic land parcels and residential lots in high growth areas.  It also makes special situation bridge loan and note purchases on land-related assets.  Rockspring Capital acquires with all cash in markets within the “Texas Triangle” – Houston, Austin, San Antonio and Dallas/Ft. Worth. For more information about Rockspring Capital, visit www.rockspring.com.

Posted by: In: Rockspring News 08 May 2012 0 comments

Rockspring Capital Managing Director Jim Hynes will speak at the upcoming Land Forecast Lunch hosted by O’Connor & Associates on Wed., May 23.

Hynes’ presentation will focus on the real estate investment firm’s strategy of investing in the robust “Texas Triangle” region of Houston, San Antonio, Austin and Dallas – Fort Worth. He will inform attendees about Texas land and the unique opportunities the region is presenting investors today.

“We’re experiencing  a ’perfect storm’ of illiquid national bank lending coupled with a healthy Texas economy with  tremendous population growth and job creation,” said Hynes, who joined Rockspring Capital in 2010 and is responsible for business development activities related to capital raising for the company’s funds. “This is providing generational buy opportunities for experienced, all cash investors.”

The lunch is part of an ongoing series of real estate forecast events hosted by O’Connor & Associates where presenters share their thoughts on trends and outlooks for a variety of commercial land uses. It will be held from 11:30 a.m. to 1 p.m. at the Courtyard on St. James (1885 St. James Place near the Galleria).

For more information and to register, click here.

About Rockspring Capital

Rockspring Capital is a Houston-based land investment company founded in 1973 whose strategy is to acquire opportunistic land parcels and residential lots in high growth areas.  It also makes special situation bridge loan and note purchases on land related assets.  Rockspring Capital acquires with all cash in markets within the “Texas Triangle” – Houston, Austin, San Antonio and Dallas/Ft. Worth. For more information about the company, visit www.rockspring.com.

About O’Connor & Associates

O’Connor & Associates is a real estate service company in operation since 1974. O’Connor & Associates is one of the largest independent real estate research and support services firm in the Southwest, conducting business nationwide. O’Connor employs over 200 people in four key areas of real estate services. For more information about the company, visit www.poconnor.com.

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Posted by: In: Newsletter 25 Apr 2012 0 comments

By Michael Ross

Senior Vice President, Asset Management & Entitlements

Rockspring Capital started 2012 with a bang, as we continued our aggressive cash acquisition program with a couple of very creative deals.

In January, we purchased a non-performing note from a national bank.  The note was secured by a six-acre land parcel adjacent to a previous Rockspring acquisition in Houston’s Texas Medical Center.  By fully understanding the underlying value of the collateral, we were able to aggressively bid and ultimately acquire the note.  Thirty days after the note was purchased, the borrower paid it off for more than a 200 percent annualized return.

Rockspring also purchased a subdivision in New Braunfels, Texas.  Most people think of New Braunfels as a tourist destination.  However, it is also a popular area for commuters working in eastern and northern San Antonio.   As local market experts, we recognized before most others that this area is a growing market for today’s national home builders.  The acquisition consisted of 48 finished lots and 66 fully entitled lots.  By quickly analyzing this sub market and utilizing our trademark aggressive all cash strategy, we quickly closed on the property in less than 30 days.  We are now in negotiations with a national home builder to acquire the lots at a nice premium for our investors.

Rockspring also has a full pipeline of similar creative deals that will provide profits to our investors in both the short and long term which I’ll be updating you on in the future.

Posted by: In: Newsletter 20 Apr 2012 0 comments

By Jim Hynes

Managing Director

Rockspring Capital has a successful 40-year history of making land investments in Texas.

The company has historically provided its investors safety and growth by strategically acquiring land sites with all cash and then completing any necessary entitlements or other improvements that add tremendous value before an ultimate sale to an end-user.

The income component is derived from a number of very creative investment strategies to deliver upwards of a five percent annual distribution paid quarterly.  These investments include:

  • Acquiring non-performing mortgages at discount and then accepting a pay off;
  • Issuing first-lien mortgages to borrowers at low loan-to-value and high interest rates on a short term basis with land as the underlying collateral; and
  • Buying residential lots in bulk then selling them to builders on a monthly takedown.

A couple of these investments have already been made by the company this year (see the next article by Michael Ross) with many more in our acquisition pipeline.

With investors today seeking safety, growth and income in their portfolio, Rockspring Capital delivers on every one of these attributes in a very impressive Texas land strategy, which maximizes opportunities in the nation’s most stable, growing and safe-bet economy.   And with traditional lending institutions still on the sidelines, especially for land, market experts with the ability to close quickly with cash, like Rockspring Capital, are free to invest at very attractive prices.

Posted by: In: Newsletter 13 Apr 2012 0 comments

By Jim McAlister IV

President and Chief Executive Officer

The entire state of Texas is greatly outperforming the rest of the country in terms of population and employment growth. The extent of this outperformance is pretty amazing.

Over the past 10 years Texas has gained more than 700,000 new jobs, more than the next 19 top job growth states in the U.S. combined! Additionally, Texas’ growth projections for the next 10 years are even stronger than the past decade.

While all the cities within the Texas Triangle are seeing exceptional growth, Houston is on the cusp of becoming the next global city and is truly poised to make a quantum leap.

The Brookings Institute, one of the premier “think tanks” in the world, named Houston as North America’s fastest growing metro area. The report analyzed gross domestic product, employment, income and population rates by major metro area.

Some of the driving factors behind the success of Houston include:

Energy

There is no city in North America that benefits more from a healthy energy sector than Houston.

The worldwide demand for energy is increasing daily as countries like China and India transform from Third World nations to industrialized economies. Yet much of the easy and inexpensive oil fields have already been tapped out, and much of the new drilling requires expensive equipment and technology. The equipment and technology companies who can meet that need are primarily located in Houston.

In other words, energy is going to play a more dominating role in world economics than in the past and Houston will find itself at the center of that industry.

Texas Medical Center

Houston is also home to the largest and most sophisticated medical center in the world, the Texas Medical Center. The Texas Medical Center has been rapidly expanding for decades, and today demand for new medical space is stronger than ever.

For the next several decades, our country’s demand for medical attention from baby boomers will increase. Houston is poised to benefit from that demand more than any other city in North America. It is already established as THE place to go for serious medical needs (as was demonstrated by Gabrielle Giffords’ remarkable treatment and recovery) and has become a destination for others around the globe, in particular in Central and South America, with serious medical needs.

The Texas Medical Center is also a capital for research. Houston is leading the charge in the future of medicine, genomics and other similar areas.

Port of Houston

As worldwide commerce increases, ports play a larger role. The Port of Houston has been growing at a staggering rate for decades and is now the second largest port in the U.S.

The port’s traffic will see more growth than it has in the past once the widening of the Panama Canal is completed in 2014. Super tankers from the East have not been able to reach Houston because the Panama Canal’s capacity.

What is already a tremendous boon for Houston’s economy is about to see unprecedented growth.

Entrepreneurial, Capitalistic and Ethnically Diverse City

Since the 1920s, Houston has measured worthiness on smarts and hard work, an attitude which has helped it become known as the most entrepreneurial city in the world.

Houston also benefits from the capitalistic government of Texas. Texas is a “right to work” state, which keeps wages under control and gives employers the right to promote or cut jobs as needed. In addition, Houston businesses and individuals gain from having no state income taxes. Tort reform, another pro business measure, is also found here in Texas.

In addition, Houston is the most ethnically diverse large metropolitan area in the nation. This blending of cultures leads to constant new ideas while also helping to feed the city’s entrepreneurial spirit.

Conclusion

With the Texas Triangle greatly outpacing the rest of the country in growth and Houston morphing into the next global city because of energy, the Texas Medical Center, Port of Houston, entrepreneurial attitude, capitalistic atmosphere and ethnically diverse environment, the Lone Star State’s future looks very bright.

Posted by: In: Newsletter 10 Apr 2012 0 comments

By Beau Ryan

Senior Vice President & Chief Operating Officer

Last August, Rockspring Capital’s President and CEO Jim McAlister was asked to speak at a Land Forecast Breakfast hosted by O’Connor & Associates.  The breakfast is part of an ongoing series of real estate forecast events where presenters share their thoughts on trends and outlooks for a variety of commercial land uses.  As one of the few local experts on the Houston land market, Jim provided insights on land trends and transactions (read more about the breakfast in a story from Houston’s Real Estate Bisnow here, and see some of Jim’s thoughts on the market in a follow up story which ran on the front page of the Houston Chronicle’s Business section in September 2011 here).

This year, O’Conner & Associates and Rockspring Capital will once again work together, this time as part of a strategic partnership in order to jointly publish a Texas Land Report in the near future. Based on deed transactions and changes in volume/pricing, this report will be of great benefit to all who want to know more about the recent performance of the Texas land market.

In addition, Jim McAlister will speak at O’Conner & Associates’ upcoming Land Forecast Luncheon scheduled for May 23 at the Courtyard on St. James.

O’Connor & Associatesis the largest independent real estate research and support services firm in the Southwest, conducting business nationwide. The company employs over 200 people in four key areas of real estate services:  Market Research Department, Appraisal Department, Property Tax Department and Federal Tax Reduction Department.

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