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Oklahoma City, OK

Like much of the country, Oklahoma suffered an energy and agriculture “depression” in
the 1980s. Because we host huge petroleum and agricultural industries, the entire state
felt an economic setback. What’s more, as the capital city and most populated portion of
the state, Oklahoma City (OKC) saw a similar slowing of economic growth. But times have 
changed. Not only did Oklahoma City weather the economic storm of the 80s, we have
regained momentum and expanded our vision for the future. Oklahoma City is bouncing 
back in a big way. We have seen a surge in economic growth in recent years and, by all 
accounts, this upswing is here to stay. In the recent 2005 Economic Review, Oklahoma 
City leaders predicted the good times will last for the foreseeable future and cited a number 
of encouraging indicators on the horizon. For example, there is a growing rush of companies 
looking to Oklahoma City as a prime location for establishing new businesses or expanding 
current ones. Leaders see a steady growth for greater OKC in the areas of commercial real 
estate, job growth, and retail development.

How Did We Get Here from There?

The recent economic growth of Oklahoma City can be attributed to a number of factors.

First and foremost is the drive of the people. Oklahoma Cityans are an exceptional breed;

we seem to excel at overcoming hard times. Through the 80s’ economic setbacks and the

90s’ massive tornados and the bombing of the federal building, Oklahoma City residents

faced adversity head-on and looked to the future. The end result is a city thriving with

excitement and promise.

Oklahoma City has not been alone in its struggle to regain economic strength; we receive

a huge amount of support from the state. For example, in 2004, the Oklahoma

Department of Commerce helped to create more than 16,000 new jobs and attract more

than half a billion dollars in new investments in the state. Many of these opportunities are

centered in the Greater Oklahoma City metropolitan area and these partnerships will be

expanded in 2005 and beyond.

Among other things, the Commerce Department’s priorities include increasing assistance

to businesses that want to pursue international trade opportunities, using web-based

technology to better recruit businesses, and providing services to existing businesses and

communities by creating a statewide web-based GIS system that offers an online services

database. A similar system is already available for the OKC area (see below.)

The Success of Metropolitan Area Projects (MAPS)

One of the key examples of OKC’s recent growth – and a perfect illustration of the

commitment of its residents – is the successful MAPS program. Through a voluntary

sales tax, OKC residents have undertaken a major initiative to rebuild downtown

Oklahoma City. The Metropolitan Area Projects (MAPS) plan was put into place in 1993,

when a sales tax was approved. In the end, more than $400 million in sales tax collections

and earned interest helped to revitalize the downtown area. Some work is still continuing,

but the outcome thus far is phenomenal. Among the key components of MAPS are:

• Oklahoma City Bricktown Ballpark – Completed in 1998, this state of the art

ballpark is home to the Oklahoma City Red Hawks, our triple-A baseball team.

The $34.2 million Park seats 15,000 and includes a number of independent

restaurants as part of the structure.

• Trolley Transit System – This is a motorbus system that serves central

Oklahoma City, allowing visitors to park and ride from attraction to attraction.

• Ford Center Arena – This new $87.7 million facility contains 20,000 seats and

attracts top entertainers (including the likes of the Rolling Stones, Britney Spears,

and Oklahoma’s own Toby Keith).

• Cox Business Services Convention Center – Formerly known as the Myriad

Convention Center, the major expansion and rehabilitation of this facility has

expanded OKC’s ability to host major conventions. (Recently announced

conferences include the 2008 Central States Shriner’s Convention, which is

expected to have an economic effect of $11.9 million.)

• Library/Learning Center – This $21.5 million facility has just finished

completion within the last year and is an example of OKC’s dedication to

investing in our most prized asset for the future: our children’s education.

• Civic Center Music Hall – A complete facelift and reconstruction was given to

our beloved music hall, allowing us to attract more concert promoters looking for

a sophisticated venue.

• Oklahoma City Bricktown Canal – This mile long “riverwalk” snakes through

Bricktown (part of old OKC) and is partially lined with restaurants, bars, and

shops. A boat ride allows visitors to see impressive water fountains and seasonal

gardens along the way. Eventually, the canal will expand to connect to the North

Canadian River, which is also undergoing development.

• North Canadian River Development – A dam-lock-lake improvement of this

major waterway through Oklahoma City is still underway. Eventually, the

riverbanks will be developed with retail establishments, parks, and running/bike

paths. (The riverfront will also be the site of Dell, Inc.’s new building.)

Other New OKC Attractions

In addition to the MAPS projects, OKC has welcomed a number of new investments to

add to the growth of downtown. These include:

• Oklahoma City Museum of Art – This beautiful building was built entirely with

$14.5 million in private funds. The exterior is limestone to complement the

surround civic art deco era buildings. Inside, but visible from the street, is the

world’s largest Dale Chihouly glass sculpture.

• Oklahoma City National Memorial and Museum – This peaceful memorial and

its informative museum honor the victims of the 1995 Murrah Federal Building

bombing.

• And several new office buildings and hotels, a 24-screen motion picture complex,

a large upscale apartment complex, and major expansion to the nearby Oklahoma

Health Center.

The News is Out!

Those of us living in Oklahoma City are not alone in thinking this is a special place. An

increasing number of lists, surveys, and indexes point to OKC as a prime location for

relocation and investment. Among these are:

• Expansion and Relocation

Oklahoma City recently made Expansion Management magazine’s “Hottest

Cities” list for the second straight year. OKC ranked 8th on this list for business

expansion and relocation, published in the magazine’s January 2005 issue. The

list is based on the perceptions of more than 80 national site selection consultants

and considers such factors as business climate, work force quality, operating

costs, incentive programs, and ease of working with local officials.

• Medical & Emergency Technology

Popular Science magazine recently rated Oklahoma City No. 3, among 122 of the

nation’s largest metropolitan areas, in the arena of medical and emergency

technology. The rankings were based on several criteria, including the number of

hospitals and health care providers with advanced information technology, the

percent of emergency vehicles operating under computer-aided dispatch, and the

percent of emergency vehicles that are GPS-equipped.

• Cost of Living

The American Chamber of Commerce Researchers Association (ACCRA)

recently issued its cost of living survey for 2004. The survey includes a detailed

look at 307 cities nationwide. For the second quarter of 2004, the composite index

for OKC metro area was 92.2, or 7.8 percent below the national average of 100.

Our low housing costs are one of the principal reasons the Oklahoma City cost of

living remains relatively low – and makes OKC a great place to live.

• Home Appreciation

A recent report from the National Association of Realtors (NAR) revealed a study

of 127 markets tracked over time. The study found the median price of an existing

single-family home in the Oklahoma City area rose 17.5% from 2003 to 2004.

This was higher than the national average, which showed a gain of only 7.7%. A

similar study, reported by Kiplinger.com, tracked housing prices in 300 cities over

the last 1, 3, and 5 years. Oklahoma City ranked ahead of many nearby cities, yet

well behind most coastal areas. This shows we have solid growth, while

maintaining controllable prices.

• Economic Freedom

The Pacific Research Institute for Public Policy recently released data from their

U.S. Economic Freedom Index (reported in Forbes.com). They evaluated 143

variables for each state, using the most recent data. This includes tax rates, state

spending, occupational licensing environmental regulations, income

redistribution, right-to-work and prevailing-wage laws, tort laws, and the number

of government agencies. For each of the 143 variables, the group ranked states

from 1 (most free) to 50 (least free), calculated an average sector ranking, and

then weighted these to get an overall score. The state of Oklahoma ranked 6th in

the nation and, by definition, that makes Oklahoma City an economically friendly

place to be.

Oklahoma City Demographics

As the capital of Oklahoma, Oklahoma City is a sprawling metropolis of more than

500,000. However, when the surrounding suburbs are included, residents of “Greater

Oklahoma City” are approximately 1.3 million strong. Our numbers are growing; the

population is expected to rise 10% by 2010. With a median age of 31.4, Oklahoma City

has a somewhat youthful – yet mature – composition, poised to expand and develop the

metro area in coming years.

The average income for residents of Greater Oklahoma City was $25,472 in 2003, a

63.1% increase from 1990. We have an 83.4% high school graduation rate, with 187,939

residents holding a bachelors degree and 65,623 holding a graduate degree.

Employment in OKC

During the recession of the 80s, job loss in Oklahoma City was less severe than for the

U.S. as a whole. In fact, OKC has a thriving climate for employment, boasting a low

unemployment rate of only 3.3%. Within the next few years, we will have close to one

million people in the workforce.

One reason Oklahoma City’s employment rate has not suffered may be due to the its

location and the role it plays in hosting governmental operations; because OKC is both

the state capital as well as the county seat, government employment has remained strong

throughout the years. In fact, federal, state, and local governments account for

approximately one out of five jobs in Greater Oklahoma City. Other major employers

include Tinker Air Force Base, General Motors, and a number of independent energy

companies. 

Employment in the education and health services sectors accounts for 25% of all

Oklahoma City employment, having grown by approximately 6 percent since 2001 (see

graph below). In addition, the rise in oil and natural gas prices during the last few years

has led to thousands of new and retained jobs in the energy sector.

Residential construction, closely tied to demographic factors, continues to grow as baby-boomers

expand the 45-to-64 year old age group and demand upgraded homes, second

homes, and assisted living housing. Their children augment the younger age groups,

resulting in an increased demand for single-family housing and rental apartments. As a

consequence, the construction industry is the goods producing sector’s largest source of

employment growth in Oklahoma City. During 2004, a number of businesses announced 

plans for new facilities or expansion of existing operations in Oklahoma City. 

What’s Planned for the Future?

The Oklahoma City Chamber of Commerce has just completed an intensive community

assessment process to determine OKC’s strengths and weaknesses. The goal was to

develop a human capital development strategy. Among the priorities outlined for 2005

are:

• Higher Education Collaboration: The Chamber plans to develop programs that

help to retain and attract graduates of higher education in Oklahoma. This will

include an internship program and a plan to improve marketing of Oklahoma

City’s opportunities to graduates.

• Wi-Fi: The Chamber is exploring possibilities of expanding wireless internet

access throughout the City. This effort will require coordinating resources and

service providers and provide state of the art technology across the city, similar to

programs being developed throughout the country.

• Entrepreneurship: The Chamber is expanding a program that encourages

providing resources, tools, and assistance to entrepreneurs who wish to develop

businesses in Oklahoma City. This program supplements the already strong

emphasis on the expansion of existing companies and the recruitment of new

companies to the area.

Empowerment Zone

Oklahoma City’s “Empowerment Zone” is a federally designated area of greater OKC

that was created to promote public-private collaboration and to stimulate job growth in

the state. This pool of tax breaks and incentives is for businesses and employees working

within the Zone. It will provide as much as $4.5 billion dollars in benefits through

December 2009.

Tax credits of up to $3,000 per year are available for each qualified Empowerment Zone

employee – whether newly hired or already on the payroll – living and working in the

Empowerment Zone. Also available are tax-exempt facility bonds to finance property,

equipment, and site development. Additional tax deductions are provided through

increased expensing deductions; up to $35,000 for depreciable assets were acquired this

year. Many area firms are cashing in on these great savings, and new businesses are being

drawn to Oklahoma City to take advantage of these benefits.

 

Housing

Housing in Oklahoma City is often described as having high value at low cost. An Ernst

and Young study revealed that OKC has the lowest cost executive-level homes in

America. Architectural style varies from historical preservation to the newly developed

customized home. Prices range from $36,000 to $359,000 for single family homes, with

townhouses and condominiums ranging from $39,000 to $120,000.

In February, PMI Mortgage Insurance Company released its Risk Index for the winter of

2005. This Risk Index represents an assessment of geographic house-price risk and the

probability of a regional home price decline as measured over the next two years.

For this year, the index indicates a decreased probability of an overall house price decline

since the autumn of 2004. Based on PMI’s model, the average risk value of the 50 largest

Metropolitan Statistical Areas (MSA) is 161, suggesting that – on average – there exists a

16.1% probability of an overall house price decline. However, for Oklahoma City, there

is good news. The City is listed among the five MSAs least likely to exhibit home price

declines over the next two years. For the last ten years, these five areas have shown a

slower pace in home appreciation rates. In fact, OKC has trailed the nation in home-price

appreciation, but shows very positive demographic trends. Several suburban areas in 

Greater Oklahoma City have seen moderate appreciation in home values over the last few years. 

Across the Metro area, the average per-square-foot cost was up only $2 in 2004. Careful

analysis suggests that this increase is due to material costs, not labor. At present, the

value of land is rising. By 2006, the per-square-foot cost will accelerate because homes

coming on the market now reflect an already built-in cost.

The first quarter of 2005 looks consistent with the trends seen in 2004. In fact, 2005

should show a continued increase in appreciation due to the fact that rising interest rates

will keep home sales balanced and will retard aggressive increases. 2006 will reflect not

only the improvement in our economy that began in earnest last year, but will reflect the

increase costs of land and materials. It is also reasonable to assume that labor costs have

to rise as the building boom continues and competition for workers will increase the cost

of labor.

Oklahoma City: Clearly a Great Place to Live and Work

As well described in this report, Oklahoma City is a great place to live and work. We

have a growing economy, the cost of living and housing market are some of the best in

the nation, and our future is bright. If you’re looking for a new place to call home, come

to Oklahoma City!!

For more information

• Much of the information provided in this report was obtained from the Oklahoma

City Chamber of Commerce. Visit www.okcchamber.com.

• The City of Oklahoma City web site provides a great deal of information about the

City, its history, and its plans for the future. Visit www.okc.gov.

• The Oklahoma City Economic Development Information System (OKCEDIS) is an

internet GIS application, hosted by the Greater Oklahoma City Chamber of

Commerce. It offers site selection analysis tools and immediate access to information

on expansion and relocation. Visit www.okcedis.com.