Several developments mark 2015 across RGV

The year got off to a big start in the Rio Grande Valley, literally, with the arrival of the USS Constellation at the Port of Brownsville on Jan. 16.

International Shipbreaking Ltd. took delivery of the “Connie” after it had been towed from Bremerton, Washington, and around the bottom of South America to the port for scrapping.

Six months later, in July, the company took delivery of the decommissioned USS Ranger, though the Constellation is still the largest of a string of retired “super carriers” to come to Brownsville in recent years.

The year wasn’t so great for another Brownsville ship recycler, Esco Marine Inc., which filed for Chapter 11 bankruptcy in March after defaulting on a $31.4 million loan from Callidus Capital Corporation of Toronto.

In June, the U.S. Bankruptcy Court for the Southern District of Texas approved a bid by Callidus to acquire Esco’s 88-acre marine yard, machinery, equipment and other substantial assets. Callidus recently signed a Letter of Intent with HRP Brownsville LLC (owned by Hilco Redevelopment Partners and MCM Industrial Services) “to effectively acquire, restart and operate Esco Marine Inc.”

Also related to the port, Annova LNG, Rio Grande LNG and Texas LNG, three companies that have announced plans to build liquefied natural gas export terminals along the Brownsville Ship Channel, in March submitted pre-filing applications to the Federal Energy Regulatory Commission to begin a roughly two-year review process of the projects.

The proposals generated a substantial backlash from critics who cited environmental and safety concerns, while port leaders and other LNG backers insisted the economic benefits would be significant.

In September, the U.S. Foreign Trade Zone Board named the Port of Brownsville third in the nation out of 179 active FTZ’s for the volume of goods exported in 2014, and 25th in the nation for imported goods.

Elsewhere on the industrial-development front, Brownsville closes out 2015 apparently on the verge of landing a machining operation intended to be the first component of a sprawling steel-working complex to be developed by two European companies over 10 years in the S.H. 550 corridor.

BEDC Executive Vice President Gilberto Salinas said in December that the effort — code-named “Project Sizzle” — appeared to be very close to achieving success and that an announcement should come early in 2016. He said that if it’s completely built out the machining/foundry/forging/die-cast complex would support 4,000 high-paying jobs.

Brownsville’s Sunrise Mall underwent an extensive, months-long interior renovation, completed in November just before the start of the holiday shopping season, and also saw the opening of the city’s first Dick’s Sporting Goods the same month.

Another major retail development was October’s grand opening for the 50,000-square-foot Brownsville Toyota dealership next to the Brownsville Sports Park. Zamora Auto Group, based in Northern California, broke ground on the project in late August 2014.

The West Rail Bypass International Bridge, the first new rail link between the United States and Mexico in more than a century, was inaugurated on August 2015, with U.S. Commerce Secretary Penny Pritzker and other officials from both sides of the border on hand for the ceremony.

Mark Kroll, dean of the University of Texas Rio Grande Valley College of Business and Entrepreneurship, said the opening of the new bridge is important because it gets those trains and the associated traffic tie-ups out of downtown Brownsville.

“It opens up some development opportunities for downtown, all that property that’s freed up now,” he said. “There’s been a lot of talk of retail projects down there to supplant that rail.”

Kroll said one of the most significant business-related happenings of 2015 — and one that ties the Valley border region together — was the signing in August of a resolution by political leaders from across the Valley, Matamoros and Reynosa in support of bi-national economic development, or BiNED, on a regional level.

Signatories included Harlingen Mayor Chris Boswell, Hidalgo County Judge Ramon Garcia, McAllen Mayor Jim Darling, Edinburg Mayor Richard Garcia, Matamoros Mayor Leticia Salazar Vasquez and Reynosa Mayor C. Jose Diaz Leal.

U.S. Rep. Filemon Vela, D-Brownsville, Cameron County Judge Pete Sepulveda Jr. and Brownsville Mayor Tony Martinez also signed the resolution, which Kroll thinks is a first for the Valley. Brownsville, Harlingen and Matamoros signed the original BiNED agreement in early 2014.

“It may be a little over the top to say the signing was a historic event, but it was to the extent that I’m not familiar with anything like it before,” Kroll said. “It’s significant in that, in order for the Valley to get on anybody’s radar screen, it’s going to have to be viewed as a collective whole. Any one individual city isn’t going to be large enough to really move the needle.”

Other business-related developments for 2015 included the May unveiling of a $26.5 million expansion of the Miller McAllen International Airport Terminal, which is now more than 100,000 square feet, double its original size.

A number of hotel projects also got underway or were announced, including the $10 million Marriott Towne Place Suites, which broke ground in November in Edinburg; and the $15 million Cambria Suites, which broke ground in December near the McAllen Convention Center.

Crews also broke ground on a 225-megawatt power plan northwest of Edinburg: The natural-gas-fired Red Gate power plant is expected to be operational in 2016.

In October, Santana Textiles, a $60 million, Brazilian-owned denim manufacturing plant, began operations six years after groundbreaking in McAllen‘s 23-acre industrial park.

Kroll said other significant business developments during the year included the continuing expansion of Doctors Hospital at Renaissance in Edinburg and the movement of foreign auto suppliers into Reynosa.

In February, the Centers for Medicare and Medicaid Services approved a request from DHR to double in size, from 551 to 1,102 rooms, which would make it the largest hospital in the Valley.

“That’s becoming a huge medical complex,” Kroll said.

A new Kia plant under construction in Monterrey, meanwhile, is already attracting major auto suppliers to Reynosa, which is closely tied to McAllen’s economy, he said.

“Of course Kia is a Korean firm, and it tends to do business with Korean suppliers,” Kroll said. “Reynosa has been landing some fairly significant auto suppliers.”