Lancaster touts rapid tax base and sales-tax gains, seeks investment in AI, advanced manufacturing and hotels

Lancaster's economic development director presented a broad overview of the city's growth and recruitment strategy on July 28, citing steep gains in property valuations, strong sales-tax growth and active outreach to domestic and foreign investors.

Shane Shepherd told the council that total taxable property value in Lancaster increased about 258% over the past decade and that annual sales-tax revenue rose from roughly $8.2 million in fiscal 2014-15 to more than $23 million in fiscal 2024-25, a rise Shepherd described as the product of focused industrial and commercial development. He said that since 2020 sales-tax revenue grew by more than 84% and monthly collections show continuing growth.

Shepherd highlighted recent industrial growth, saying about 7 million square feet of industrial space came online in the most recent year, pushing vacancy to roughly 11.6% because of the surge in available space. He said the hotel market has expanded as well: occupancy recently measured about 82.8% with RevPAR around $95.88, even after a roughly 50% increase in room supply.

The city is targeting a set of strategic sectors for recruitment: artificial intelligence, advanced manufacturing, cold storage and food processing, plus hospitality and retail to boost local amenities and wages. Shepherd identified workforce partners such as Dallas College and the University of North Texas and said the city is leveraging trade shows and regional programs (including SelectUSA) to pursue foreign direct investment.

Councillors asked clarifying questions about foreign direct investment and recent company ownership changes; Shepherd said tariff and supply-chain dynamics and outbound investment trends are part of broader drivers pushing companies to locate production and operations in the U.S. He gave McKinley (cited as a recent Mexican investor in the city) as an example of capital flowing into Lancaster that becomes local economic activity when spent and developed in the community.

Shepherd closed by emphasizing diversification: "Lancaster economy is growing rapidly, driven by smart investment, strategic land use, and active recruitment," he said, adding that the city will continue to target quality jobs and support retail and place-making to improve local quality of life.

No formal actions were required during the presentation; staff will continue recruitment and follow-up with council as projects progress.