Update: President Obama made the announcement officially nominating Julián Castro for Housing and Urban Development secretary and Shaun Donovan for budget director shortly after 3:30 p.m. Friday. 

Speaking first of Donovan, Obama said that "every member of my cabinet had a tough job in front of them, and few had a tougher job than Shaun Donovan," noting his response to both the housing crisis and Hurricane Sandy. "When you’re good at your job, people always want you do to even more," the president said, and highlighted Donovan's "reputation as a great manager, a fiscally responsible leader." 

Moving on to Castro, whom he introduced as "another all-star who’s done a fantastic job in San Antonio over the past 5 years," Obama remarked on Castro's speech at the Democratic National Convention in 2012 and his role as mayor of San Antonio, where he's worked at "revitalizing one of our most wonderful cities" and "become a leader in housing and economic development." 

Obama said that he hoped both confirmations would go through the Senate "without games or without delay."

Donovan and Castro followed the presidents remarks with brief statements of their own. Donovan praised the OMB for being one of the "most critical" offices in government and a place where his "love of spreadsheets will finally be embraced." Castro said as HUD director he will work to "ensure we do housing right, and because of it, more Americans achieve their dreams."

Original Article: President Obama will make the announcement Friday afternoon that San Antonio Mayor Julián Castro will be his new housing secretarythe Associated Press reportsAlmost a week ago, reports emerged that Castro was headed for a position in Obama's cabinet, leading to speculation that Castro was in the running to be the Democrats' vice-presidential nominee in 2016.

According to AP, Castro will take over as Secretary of Housing and Urban Development, while the current HUD secretary, Shaun Donovan, will become Obama's budget director. AP notes the similarities between Obama and Castro:

The two men's life stories are similar: Both are minorities raised by single mothers, they hold Harvard law degrees and saw their political careers skyrocket after giving lauded Democratic convention keynote speeches.

Indeed, Castro's profile has been growing since 2012 (much the same way Obama's did after the 2004 DNC), when the president selected the San Antonio mayor to give the keynote address at the Democratic National Convention. 

Obama had been interested in bringing Castro on for some time, AP reports, but Castro wanted to wait. After winning reelection last year with two-thirds of the vote, Castro is finally moving on to the national scale.

Castro's impending turn as HUD secretary is only fueling speculation, too, that he's on track for a vice-presidential nomination, which began after his address at the DNC two years ago. A 2013 article from Real Clear Politics posits that that "by most accounts, Castro would be eager to answer the call to national office." Castro himself, however, shies away from any VP speculation. 

Obama is moving Donovan to the Office of Management and Budget to fill in for Sylvia Matthews Burwell, who was given approval by a Senate panel Wednesday to replace the outgoing Kathleen Sebelius as Health and Human Services secretary. Both Donovan and Castro will face Senate confirmation, once the president officially nominates them.