< Previous GEDP.ORG // 2019 GEDP DEVELOPER PROFILE 19 www.gia-tx.comCommercial • Personal • MarineWindstorm • Flood Auto • Health Reliable, Professional ServiceBefore and After the Storm for 127 YearsFriendswood211 W. Edgewood Dr. Ste. 200281-442-1892Galveston6025 Heards Ln409-740-12511892 – 20191892 – 2019Galveston OverviewTRANSPORTATIONGalveston is at the gateway of inter-modal transportation and possibilities for business and industrial development. Extending into Galveston County and beyond, Galveston is the front door to deep water international maritime shipping, connectivity with two Class 1 Railway companies, Scholes International Airport, an ever-improving Highway Interstate and proximity to area communities with abundant land. Galveston’s transportation matrix is available for regional, national and international development.TROLLEYThe City of Galveston is planning for the return of the Rail Trolleys by December of this year. Plans are forecasted for these trolleys to be operational by the Spring of 2020. Plans are also in development for a new collaboration between the City and Galveston’s Tourism industry. Plans are in development for a new system of tokens to be utilized by guests staying at local hotels.20 2019 GEDP DEVELOPER PROFILE // GEDP.ORGGalveston will never be described as a “cookie cutter” community. Whether your idea of the perfect home is a coastal themed abode along a waterfront canal, a 19th-century Victorian Loft in the heart of Downtown, or a more traditional dwelling – Galveston has a neighborhood for you.HISTORIC CHARM Galveston’s historic neighborhoods provide homeowners many unique opportunities. With hundreds of historic structures on the National Register of Historic Places and thousands of historic houses, Galveston is one of the country’s most important concentrations of late 19th- and early 20th-century architecture. From stately mansions to quaint cottages to the conversions of downtown buildings to residential lofts, Galveston’s older neighborhoods offer a wide range of housing options.COASTAL ELEGANCE AND WATERFRONT LIVING Galveston has many neighborhoods with coastal-inspired homes along the beaches or on canals. Islanders have the option to enjoy the beautiful sunrise over the beach from the back porch with their morning cup of coffee or end a hard day’s work with a sunset cruise by hopping in the boat outside their backyard.REAL ESTATE TRENDSGalveston’s economic renaissance continues with investments being made comprehensively across Galveston Island. While residential sales and transactions in the first six months of 2019 have experienced a slight decrease from the previous year’s same timeframe, Galveston continues to see existing homes being renovated across the island. Real Estate Overview416FAR WEST GALVESTON ISLANDYEAR END TRANSACTIONS 201892WEST GALVESTON ISLANDYEAR END TRANSACTIONS 2018933# OF TRANSACTIONS (2018)$313MIN TRANSACTIONS (2018)As the Houston-Galveston region continues to grow, with projections that it will continue into the future, Galveston maintains an excellent quality of life and quality of place as a coastal destination, “small town” atmosphere with an abundance of natural resources. REAL ESTATE ACTIVITY Based upon the comparison of the first 6 months of 2018 vs the same time period in 2019, residential real estate have dipped from year over year. Across the Island the dollar volume of sales decreased 1%,while the number of transactions decreased by 4%. While the highest percentage of transactions occurred on the West End of Galveston, new activity levels were reached within many different neighborhoods throughout the Island. The median selling price INCREASED 7%, from $269,275 in 2018 to $289,750 in 2019; the average number of days a property was on the market decreased 4%, from 74 days to 71 days.74AVERAGE DAYS ON MARKET(2018)Diverse Housing Options GEDP.ORG // 2019 GEDP DEVELOPER PROFILE 21 Real Estate Overview FIRST SIX MONTHS RESIDENTIAL MARKET RECAP 2019 VS. 2018258MID GALVESTON ISLANDYEAR END TRANSACTIONS 2018167EAST GALVESTON ISLANDYEAR END TRANSACTIONS 2018GALVESTON ISLANDDOLLAR VOLUME # OF SOLD TRANSACTIONS 20192018% CHANGE20192018% CHANGEAll Galveston Island$161,025,740$162,599,244-1%470492-4%West Galveston Island: Sunny Beach to Pointe West, Beach to Bay$103,417,494$102,681,233+1%231234-1%Near West Galveston Island: 61st Street to Sunny Beach, Beach to Bay$9,983,890$15,841,710-37%3543-19%Colony Park$1,596,500$299,900+432%51+400%Havre Lafitte$946,000$980,900-4%33No changeCampeche Cove$696,000$1,999,595-65%36-50%Evia$1,565,000$3,554,000-56%47-43%Mid Galveston Island: 25th Street to 61st Street, Beach to Bay$21,755,686$23,214,903-6%100130-23%Cedar Lawn$1,083,000$295,000+267%21+100%Denver Court$532,000$315,000+69%21+100%East Galveston Island: East of 25th Street, Beach to Bay$22,019,670$20,515,498+7%8484No changeUTMB/Downtown/East End Lofts & Condos Only$17,965,995$20,734,786-13%6883-18%ALL RESIDENTIAL SALES ON GALVESTON ISLAND - FIRST SIX MONTHS MARKET RECAP 2019 VS. 2018Average Days on Market2019: 712018: 74% change: -4%Median Selling Price2019: $289,7502018: $269,275% change: +7%ALL RESIDENTIAL SALES ON GALVESTON ISLAND - YEAR OVER YEAR MARKET RECAP 2018 VS. 2017Average Days on Market2018: 752017: 79% change: -5%Median Selling Price2018: $270,0442017: $255,500% change: + 6%SOURCE: Houston Association of Realtors Multiple Listing Service; Sand `N Sea Properties. Data deemed reliable, but not guaranteed by MLS or Broker.$289,750MEDIAN SELLING PRICE(first six months 2019)The HomeTown Team is dedicated to growing our local economy. A full-service and locally owned community bank, we know Galveston’s many opportunities firsthand, and we stand ready to help new businesses become part of our future.Where HomeTown MattersGalveston Main Bank: 1801 45th St. • (409) 763-1271Galveston Seawall Branch: 45th & Seawall Blvdd • (409) 763-5252OOOOO Five-Star “Superior” rating by BauerFinancial, Inc. OOOOOhtbna.bankJimmy RasmussenPresident and CEO Michael J. Gaido, Jr.Board ChairmanScott Kusnerik Executive Vice PresidentCesar Hernandez Senior Vice PresidentBrandon RogersVice PresidentTraci Shugart-GarciaVice PresidentHomeTown Bank of Galveston Loan Officers GEDP.ORG // 2019 GEDP DEVELOPER PROFILE 23 Real Estate Overview1. FORMER MANUFACTURING FACILITY - 6800 HARBORSIDE DRIVEIndustrial warehouse and/or manufacturing facility with 65,000-square-foot building on 22 acres of waterfront with barge access2. 59TH BROADWAY8,200-square-foot metal building on nearly 3 acres of property, on one of the busiest corridors on the island. The back of property contains water frontage on English Bayou. Location is across street from the post office and Galveston County Criminal Justice Center.3. FORMER GROCERY STORE - 45TH AVENUE S (MIDTOWN)Former grocery store on nearly 2 acres, being sold “as is” at lot value. Midtown location on visible corridor on 45th, just a few blocks from Seawall. Current zoning is commercial.4. FORMER INSURANCE OFFICE BUILDING 2115 WINNIEThe property consists of two structures, one a 3-story structure, the other a 7-story tower. The total square footage of both buildings is 144,632. Adequate parking comes with facility.OPPORTUNITY ZONE - GALVESTONAccording to the IRS, an Opportunity Zone is an economically distressed community where new investments, under certain conditions, may be eligible for preferential tax treatment. Localities qualify as opportunity zones if they have been nominated for that designation by the state and that nomination has been certified by the Secretary of the U.S. Treasury via his delegation of authority to the Internal Revenue Service.Opportunity zones were added to the tax code by the Tax Cuts and Jobs Act on December 22, 2017. Opportunity zones are economic development tools — that is, they are designed to spur economic development and job creation in distressed communities.Opportunity zones are designed to spur economic development by providing tax benefits to investors. First, investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%. Second, if the INVESTMENT OPPORTUNITIES - AVAILABLE PROPERTIESThe following properties are but a few of the opportunities of which the GEDP retains focus for redevelopment:1.2.3.4.investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.Galveston’s Opportunity Zone stretches along Seawall Blvd from about 53rd Street all the way down to the east end of the island.24 2019 GEDP DEVELOPER PROFILE // GEDP.ORGThe Maritime sector in Galveston is a significant component of Galveston’s overall economic base. Quality primary jobs, capital investments, and a diversification from Galveston’s other economic engines buoy the maritime industry’s contribution to the City, County, State, and beyond. Development activity occurs within three geographic areas of Galveston: Port of Galveston, Pelican Island, and Harborside Drive (SH 275). SECTORS POSITIONED FOR GROWTH» Business Retention and Diversification of Existing Companies» Cruise Expansion (including support services for the Cruise Industry)» Port Industries (completion of the Port’s master plan will assist in identifying high ROI segments to pursue)» Multi-Modal warehousing/distribution Facilities (county-wide)» Innovation and Technology related industries (ie Autonomous Technologies)DEEP IMPACTMaritime is a multi-million-dollar economic engine for Galveston Island and the region. The Galveston Ship Channel is the nexus for the Galveston Wharves, dozens of private businesses, and Texas A&M University at Galveston. The port alone has an estimated $5.46 billion impact statewide.The island’s growing maritime sector, which includes public and private entities, generates revenues (estimated $2.9 billion in gross state product to the Texas economy), direct and indirect jobs (estimated 20,400 direct and indirect jobs), spending, and sales and property taxes through international trade, cruises, shipping services, ship repair, commercial and recreational fishing, seafood harvesting and processing, and marine and maritime education.GEDP MARITIME TASK FORCEThe GEDP Maritime Task Force, chaired by Keith Palmer, is currently monitoring and/or addressing these critical issues: GALVESTON CITY 2019 TOP TAXPAYERS: INDUSTRIAL – REAL & PERSONALTAXPAYER NAMEMARKET VALUETAXABLE VALUEGalveston Terminals Inc$14,609,570$14,609,570Interchem USA Inc$13,236,140$13,236,140Texas International Terminals$11,997,810$11,997,810G&H Towing Company$10,031,770$10,031,770M-I Drilling Fluids$9,012,730$9,012,730Gulf Sulphur Services Ltd LLP$8,812,770$8,624,945Sws Holdings-Brady Island LP$6,306,090$6,306,090Gulf Copper Drydock & Rig Repa$6,000,000$6,000,000Halliburton Energy Services$5,415,120$5,415,120Aet Lightering Services LLC$4,917,700$4,917,700Adm Grain$4,795,120$4,795,120M-I LLC$4,756,920$4,756,920Chs Inc$7,046,760$3,099,387Baker Hughes Inteq$2,974,450$2,974,450Gulf Sulphur Services Ltd LLC$2,876,130$2,876,130At&T Mobility LLC$2,845,860$2,845,860Galtex Pilots Service Corp$2,791,010$2,791,010Jam Marine Services LLC$2,752,680$2,752,680T&T Marine Salvage Inc$2,474,220$2,474,220Jam Distributing Company$2,379,580$2,379,580Maritime Overview“The Port of Galveston’s diverse capabilities have helped Texas become the nation’s largest exporter - and the world’s 10th largest economy.”GLENN HEGAR, Texas Comptroller of Public Accounts» Maritime» Port Masterplan» Pelican Island land development» Pelican Island Bridge» Transportation – Mobility» Navigation Districts» Infrastructure Investment GEDP.ORG // 2019 GEDP DEVELOPER PROFILE 25 Maritime OverviewDIRECT ACCESS TO 4thBUSIEST CRUISE PORT IN NORTH AMERICANo. 1 in Texas30MINUTES FROM OPEN SEAS2CRUISE SHIP TERMINALSsoon to be third cruise terminal1,200/45FEET WIDE/FEET DEEP CHANNELON THE GULF COAST INTRACOASTAL WATERWAYFOREIGN TRADE ZONECLASS ONE RAIL LINES2CONNECTED TO MAJOR HIGHWAYS2PORTHIGHLIGHTSBy effectively combining distribution, fabrication and coating, Industrial Material Corporation (IMC) benefits its customers by accelerating projects, reducing cost, improving safety, and more. “IMC synergy” makes the company a lower total cost solution, where labor is limited and downtime avoided. COATINGIndustrial Material is a proven applicator, experienced with a variety of systems and conditions, blasting, coating and painting at our enclosed facilities, or your site. 7701 Harborside l Galveston, TX 77554 - 2865800.701.4462 l 409.744.4538toll free fax 877.238.4755 www.industrialmaterial.comALL ANGLES COVEREDSUPPLYOver 8,000 line industrial items of inventory, Industrial Material has the resources to quick-ly acquire almost anything you need.FABRICATIONIndustrial Material fabricates products for all phases of your project including embeds, angle clips, pipe shoes and instrument stands and capable in larger structures like platforms, pipe racks, and skids.GALVESTON WHARVESPerfectly situated at the entrance to Galveston Bay and the Houston Ship Channel, Galveston Wharves has been a maritime commercial center since 1825. Just 30 minutes from open seas, over 800 acres of the Port has infrastructure and assets to serve growing cruise, cargo and commercial businesses.Galveston Wharves is poised to further grow these businesses with the following:» Third cruise terminal to be built in 2021» 20-year Strategic Master Plan to prioritize and guide growth» Consolidation and expansion of cargo business on the port’s west end» Support replacement of Pelican Island Bridge and addition of rail bridge to create port development opportunities26 2019 GEDP DEVELOPER PROFILE // GEDP.ORGMaritime OverviewROBERT MIHOVIL GEDP.ORG // 2019 GEDP DEVELOPER PROFILE 27 Maritime OverviewCARGOThe Galveston Wharves lease and maintain a wide range of facilities on the 45-foot-deep Galveston Ship Channel. Cargo operations, served by rail and truck, are a diversified mix of roll-on/roll-off, dry bulk, export grain, refrigerated fruit, and general and project cargoes.Pelican Island is a hub for port tenants with a range of operations, including ship and rig repair, liquid bulk, and offshore exploration and production. Galveston Wharves also has approximately 500 acres of land for development on Pelican Island. LAY DOCKAGELay dockage is a growing source of revenue for the port. Since 2018, this business has generated more than 500 ship calls with more than $4 million in dockage fees for the port. That does not include revenue generated for port partners. COMMERCIALPier 21, with its restaurants, hotel, museums and other attractions, offers the public a front-row seat to our working port. The port also leases waterfront property for commercial seafood, shrimping and fishing.For more on the port’s financial information, visit: www.portofgalveston.com/DocumentCenter/View/2611/2018-CAFR REVENUE BREAKDOWN ECONOMIC IMPACT OF GALVESTON WHARVESState Economic Impact of Galveston Wharves Cargo Activity – 2018CARGO-RELATED JOBS 2018Direct2,577Induced3,347Indirect1,447Related Users3,094Total Jobs10,465Source: The Economic Impacts of Marine Cargo at the Port of Galveston, 2018. Martin Associates CARGO FLOW (TONS)CARGO2018201720162015Bulk Grain839,395734,9322,466,9313,073,498Bulk Fertilizer603,701455,945565,277620,731Bulk Liquid1,544,1031,225,7011,303,459904,659Bananas and other fruit534,412484,661486,797520,697Other General & Roll-on/ Roll-off Cargo581,779486,296383,320483,722Total Tons Handled4,103,3903,387,5355,205,7845,603,307Number of Vessels84073475281065%CRUISE26%CARGO9%LAND LEASES» $1.8 billion total economic impact» 10,465 jobs created due to the port’s cargo activity» 1,546 direct jobs held by Galveston residents» $56.7 million in state and local tax revenues generated port cargo activity» $126.5 million spent on local purchases due to the port cargo activity in 2018ROBERT MIHOVILNext >