DALLAS _ In recent years, Houston's economy has weathered oil busts and flooding, buoyed in large part by the increasing diversity of its employers.
But now, the nation's fourth-largest city has been confronted with a challenge that could overpower its economic prowess _ a perception that it's prone to catastrophic flooding that regularly grinds business to a halt.
Economic development experts are worried the devastation wrought by Harvey could be a tipping point for businesses, whose leaders increasingly weigh factors far beyond available office space and cheap land when they decide where to bring jobs.
And that prized economic diversity? It could become a double-edged sword as the region not only rebuilds but tries to recruit a broad range of employers to carry southeast Texas' economy decades into the future.
"In the eyes of our clients ... it's easily a three- to five-year mental block they'll have on locating in that region," said King White, CEO of Dallas-based corporate relocation consulting firm Site Selection Group. "Companies are going to think real smartly about where they can reinvest if they can pick up and move."
While efforts to rebuild the Texas Gulf Coast will provide a short-term economic boost, lingering concerns could be a major drag on the region's long-term growth prospects. And that could add fuel to already-explosive growth in Texas' other large metros: Dallas-Fort Worth, Austin and San Antonio.
"The (Tax Day) flood in 2016 raised eyebrows," said Suzanne Mulvee, director of research for commercial real estate information firm CoStar. The April flood dumped more than 17 inches of rain on the Houston area, killed at least six people and flooded hundreds of homes.
After Harvey, she said, "Houston may become a top 20 rather than a top 10 market from a pricing standpoint."
Still, Houston business leaders say they're hopeful the region's fundamental strengths and allure for young workers will propel the Bayou City through a time of unprecedented hardship.
"We're certainly continuing to market Houston largely with the same attributes as before," said Bob Harvey, CEO of the Greater Houston Partnership, an economic development organization serving the larger region. "Companies come to Houston because they think young talent likes Houston. ... It's still an opportunity."
