I hope that you have read “Oil Field Speculation in Dickinson, Part I”, but it is not absolutely necessary to be able to follow along with this “Oil Field Speculation in Dickinson, Part II”.
In 2011, I met here in Dickinson a truck driver who had grown up in Gillette, Wyoming. I will use the initials “SA” for this individual to protect his identity. When “SA” was a kid, there was an oil and gas drilling boom in Gillette, Wyoming. He said he remembered new apartment buildings being built and new manufactured homes being brought in. He remembered people buying new trucks, motorcycles, boat, and RVs. “SA” remembered his father standing around with other people, and they were all agreeing,”…this economy here in Gillette is so big now, it can’t fail, it’s big enough now to go on its own, it doesn’t depend on those oil field jobs, we got so many people living here now…”. Within a few years, the trucks, motorcycles, boats, and RVs were being repossessed. Whole apartment buildings became vacant or were never completed. The oil and gas drilling had stopped.
Here in Dickinson, there appears to be the belief that there are so many people in Dickinson, that the economy is big enough to not be dependent on the oil drilling. As an example of this belief, look at the new apartment buildings that have been constructed in 2012, 2013, and 2014. There are approximately eighty new units at the south end of State Avenue, approximately two hundred new units at the north end of State Avenue, approximately eighty new units near the new Menards, approximately one hundred fifty new units north of the North Park RV Park. Just to the west of Tooz Construction there are about one hundred new units. I have probably left out some of the new apartment buildings. The North Park RV Park, the Heart River RV Park, and the South Park Trailer Park have probably doubled in size. There are about four new large “Extended Stay” hotels.
I partly want to find fault with the real estate developers/investors, and then again I don’t. It is good that there are more places to live in Dickinson, it was necessary to have more places to live. If you have read my previous blogs, you can’t stay at WalMart, the truck stops, or Patterson Lake anymore. You can’t live in a tent in someone’s backyard for $700 a month anymore. However, I don’t know how much longer the new housing units are going to be needed. The real estate developers/investors and new home buyers have got to be thinking that the oil drilling is going to continue for more than several years, either that, or they think that the economy is so big in Dickinson now that it is not entirely dependent on oil drilling.
An indication that the real estate developers/investors have seen the possibility of the oil drilling not lasting more than several years, is the extremely high rent prices. You might have read in my previous blogs that a one bedroom apartment will be at least $1,500 per month, and that a two or three bedroom apartment will be $2,000 to $3,000 per month. The high rent, I believe, is in part due to the real estate developers/investors realizing that the oil drilling could stop, and that they need to get back the money they invested as soon as possible, while they still can.
My point in this particular blog, is again, to look at what has happened in the past. In Gillette, Wyoming, there was an oil and gas drilling boom, many new housing units were created, with the expectation that the economy would not fail. When the drilling stopped, apartment buildings became vacant or were never completed. Be aware of what could happen, and plan accordingly.