San Antonio is the center of economic activity and commerce in South Central Texas, located about 140 miles north of the Gulf of Mexico and 75 miles south of Austin. The Alamo City lies at the crossroads of several major interstate highways and railroads serving both coasts, as well as the NAFTA corridor. The Alamo City is also considered an international trade center due to its strong economic and cultural ties to Mexico, as more than half of the trade flow between Mexico and the United States travels through San Antonio. Its proximity to the Port of Houston and direct access to other major ports, such as Long Beach and Mexican port Lazaro Cardenas, further facilitates trade. Additionally, the logistical functionality of San Antonio is enhanced through Port San Antonio, a 1,900-acre multimodal logistics hub and business platform catering to Fortune 500 companies such as Boeing and Lockheed Martin.
Fueled by robust population and job growth, San Antonio’s economy has flourished over the last several years. The metro is an attractive market for job seekers as job creation remains strong and unemployment is at a historic low. San Antonio has continued to add jobs in 2017. According to US BLS, its unemployment rate fell to 2.9% as of October 2017, compared to 3.8% a year earlier. San Antonio is among the five least expensive metros in the U.S. to do business, which has attracted startups and corporate relocations to the metro area. The strength of San Antonio’s economic structure is its diversified employment base. While the city’s economy has historically been anchored by three major industries – healthcare, tourism and military/defense – recent job growth in the market has spanned a diverse group of industries.
ACA views San Antonio as a relatively consistent performer, with solid long-term growth prospects. The city has worked hard to broaden its industry portfolio that continues to expand. New business strengths have emerged in the past years, including biotechnology, financial services, manufacturing and information systems. Additionally, San Antonio is experiencing growth in the technology sector with local tech firms receiving $1.7B in investment capital last year. In targeted submarkets, we view San Antonio to be an attractive metro due to its economic and population growth, low business and living costs, central geographic location and versatile transportation infrastructure.