It’s hard to believe 2021 is almost over. With as long as 2020 was, this year just flew by. There is so much happening here in Northwest Arkansas that it is mind-boggling.
Since this is the annual forecast issue, I thought I should consult the Zoltaire machine in our basement to develop my predictions for the region in 2022. So here they are:
Continued population growth. I have seen numbers that our population will grow as much as 10% annually. That’s crazy. We are now being called “the next Austin” by a wide range of media. I hope that we don’t end up with Austin’s homelessness, traffic congestion and other problems if that is the case. We are already seeing our housing prices going through the roof.
Lots of new development. Bentonville and Rogers seem to be leading the way with new projects, including office buildings, retail and housing. Springdale is not far behind and is completely revitalizing its downtown and putting new stuff west of town. From my perspective, Fayetteville — other than the University of Arkansas — is lagging behind its northern neighbors. Deservedly or not, Fayetteville has a reputation for being anti-development. Denying Lewis Automotive a rezoning request so they can build a new car dealership in an existing row of other car dealerships alongside Interstate 49 is a perfect example. Their existing property on North College next to Whole Foods is super valuable and could be repurposed into something else.
More businesses will relocate here. This year we got many. Electric vehicle makers. Marketing companies. Bicycle companies. Logistics companies. Tech companies. These businesses are creating good, high-paying, primarily white-collar professional jobs. Plus an increasing number of startups of every kind. More of my students at the Walton College are starting businesses while in school or immediately after.
High growth for the UA. With the resignation of Chancellor Joe Steinmetz, I sense that the brakes on our growth will be eased up some. This fall, the Walton College is leading the way with a record freshman enrollment and so many new degree programs, certificate programs and courses that I can’t even count all of them. Our supply chain program is rated No. 1 in the nation. The college of engineering is also expanding. Then we have the $127 million pumped into our arts program. This will bode well for all colleges that are part of the UA, and I expect our total enrollment to pass 30,000 students in 2022.
Increasing housing prices. So many people are moving here because of the area’s incredible prosperity.
Thanks to recession-proof businesses like Walmart and everyone who does business with them, Tyson Foods, J.B. Hunt and other logistics companies — coupled with skilled construction labor shortages in every trade, increasing materials prices and infill everywhere — I honestly don’t think even a one-point interest rate increase will slow anything down as it relates to housing prices.
And yes, interest rates will rise. It is the only way the federal government can try to slow down inflation caused by record total employment, shortages and printing up billions of dollars — maybe trillions — and throwing them into the economy.
I also do not think the answer to the housing affordability problem lies in 900-square-foot, two-bedroom houses on 25-foot-wide lots with no garages that sell for $270-$300 a square foot. Most married couples and young families want a three-bedroom home with a two-car garage and fenced yard for under $165 a square foot. That is still cheap by national standards. Not everything is going to be walkable. We are going to have more “sprawl.” You can’t meet the market demand without it.
I will refrain from making any political predictions for 2022 because it is smart to do so. Good luck and Happy New Year.
Mark Zweig is the founder of two Fayetteville-based Inc. 500/5000 companies. He is also entrepreneur-in-residence teaching entrepreneurship in the Sam M. Walton College of Business at the University of Arkansas, and group chair for the Northwest Arkansas chapter of Vistage International. The opinions expressed are those of the author.