Birmingham, Alabama Has Bright Future: Investors Buy Now!



Birmingham Alabama has a bright future and our advice to investors is, BUY NOW! In 2011 the Jefferson County, where Birmingham is located, declared the biggest municipal bankruptcy in U.S. History (prior to Detroit, Michigan two years later). Reading this article you may be thinking, “Wait a minute here, didn’t you just say that Birmingham had a bright future, and we should buy now?” Yes, you read correctly! You see the reasoning behind the two bankruptcies is completely different. Birmingham, Alabama took out a massive loan to improve sewer infrastructure and then defaulted on the loan from JP Morgan Chase. This 1.4 Billion of this loan was forgiven, and the remaining 1.8 Billion was refinanced over 40 years. In reality this move made Jefferson County more solvent than most major metros across the country, giving them a great deal of new infrastructure, while eliminating half of the cost of implementing it, and then spreading the bond repayment over 40 years so that it’s not burdensome to the citizens water/sewer bills!

Detroit, Michigan’s bankruptcy on the other hand was due to economic obsolescense due to the auto unions pricing the labor in the area out of jobs and the manufacturers they worked for deciding to outsource jobs over seas, or to more friendly “right to work” states with low unionization rates, like Alabama. Like Detroit, where the city was bankrupt but the county was solvent, the City of Birmingham was in a strong financial position while the county was bankrupt. Now, however, the county has come out of the bankruptcy and the future looks very bright. Let’s detail some of the strong reasons why Birmingham and Jefferson County are now one of the best places to invest in real estate in the United States.

“Forbes” magazine notes, “In the last two years, unemployment rates in Birmingham have dropped from 8.6% to 6% and are now sixth-best among all large

metropolitan areas in the country, according to the U.S. Department of Labor. The city’s real GDP has outpaced national growth, and Birmingham’s vacancy rates are at their lowest levels since 1997. But it’s not just that Birmingham is riding the comeback of the rest of the county. Birmingham’s GDP grew by 2.1 % in 2011 and 3.8% the next year, roughly one-and-half times the national growth rate both years. The city’s unemployment numbers have dropped at nearly double the nation’s rate.”

According to the Birmingham Chamber of Commerce 50% of the Fortune 500 Companies have a presence in Birmingham, and two of them have their headquarters here, including Regions Financial Corporation (312), Graybar Electrics (470). Additionally eight Fortune 1000 companies are headquartered in Birmingham, including: Vulcan Materials (594), Touchmark (623), Saks (270), Caremark Rx (364), Healthsouth (391), Bruno’s (799), Protective Life (838), Compass Bancshares (860).

New growth and business expansion continue to fuel job growth and make Birmingham an increasingly popular destination for job seekers, in fact:

  • “Business Insider” ranks Birmingham as #12 Best City for Job Seekers in 2014 with 19% of companies planning to hire.
  • Alabama is ranked #2 strongest auto industry in the United States.
  • “Forbes Magazine” rates Birmingham as 1 of 15 up and coming down towns and #12 2014 Most Affordable Cities.
  • “Network World” calls Birmingham the Silicon Valley of the Southeast.
  • “U.S. News and World Report” has UAB School of Medicine ranked 10th in the Nation for primary care.

Major developments improving the economy of Birmingham, Alabama include:

  • American Steel Pipe announced that it will build a new $55 million facility in Birmingham a month ago. Mercedes-Benz announced plans to hire roughly 1,400 new workers for its Tuscaloosa plant an hour south of Birmingham. And Honda has added about 400 jobs over two years to its plant in nearby Lincoln, according to the Birmingham News.
  • Birmingham is a huge manufacturing and primary metals hub, with 37,000 employed in the manufacturing sector, and another 6,900 employed in primary metals manufacturing. Three of the nations 7 iron pipe manufacturer’s are headquartered here. German steel giant Thyssen Krupp has just built a $13,000,000 processing and distribution center 20 minutes from downtown.
  • A new Honda plant in Lincoln has capacity to build 340,000 Odyssey, Pilot, Acura MDX, Ridgeline pickup trucks per year. It employs 4,500 people.
  • There is also a Mercedes Benz plant in Tuscaloosa County just to the south. It produces the M class, R class, and GL class SUV’s. Starting in 2014 it will also be producing the successor of the current C class, for all of North America, and beginning in 2015 the plant will start producing a new Mercedes line as it’s 5th product line.
  • Birmingham is the 9th largest banking center in the United States, and serves as home to two major banks: Regions Financial Corporation , the 8th largest U.S. Bank (by total assets) which employs 7,668 people and BBVA Compass. The city has a regional headquarters of Wells Fargo Bank. Nearly a dozen smaller banks are also headquartered in the Magic City, such as Superior Bank and New South Federal Savings Bank.
  • A major hub for education in the state, located within a 50 mile radius of downtown Birmingham are two dozen universities, colleges and technical schools with a combined enrollment of more than 100,000 students. The University of Alabama Birmingham is thriving, with 18,000 students and 23,000 employees. It has raked in $172 million in funding from the National Institutes of Health this year—five times as much as all of all of the other institutions in Alabama combined.
  • The University has worked with the city, county and local companies to create a business incubator in a renovated, 140,000 square-foot Sears building. The Innovation Depot now houses roughly 500 employees working for 95 different companies like UAB spinoff Malcovery Security, a cybersecurity business founded less than a year ago that already counts IBM, eBay, VISA, and Facebook among its clients. UAB, with it’s large number of faculty, biomedical researchers and physician scientists, physicians and surgeons, is major driver of the economy.

While it gets much less fanfare than Atlanta, with a population of 212,037 within the city limits, it is about half the size of Atlanta, and there are 1,128,047 in the metropolitan area. Birmingham is a stable job market and is the largest city in Alabama 1/4 of the population of the state lives in the Birmingham metro area.

For more information about the Birmingham investment market, call Jared Garfield 404-718-9126