Market Reports

By Nick Knecht, Senior Advisor, Industrial, Dickson Commercial Group The vibrancy and growth of the Reno-Sparks industrial market has solidified the region’s position as a premier distribution hub of the Western U.S. — even as we head into what is expected to be a nationwide economic slowdown in the near term. The third quarter continued the trend of positive net absorption of 469,970 square feet. This occurred even with four new construction deliveries totaling 1.7 million square feet, 98 percent of which was spoken for upon completion. This momentum is expected to continue to some degree, as our team is actively negotiating RFPs on each of our speculative big box listings, with space requirement inquiries coming in at a steady pace. Alongside this positive activity, our market has been affected by the economic turmoil that has started to take shape over the past two quarters, with similar trends discussed nationwide. A changing debt market has produced several price adjustments mid-transaction for buyers to stay within their underwriting thresholds. The number of developers aggressively acquiring land at a feverish pace has decreased as they face a higher cost of capital and tamp down rent growth assumptions to more reasonable levels. There …

By Paul Sweetland, Senior Vice President, Colliers After a record year in 2021, Southern Nevada’s industrial market does not appear to be slowing down. The first-quarter vacancy decreased to 1.7 percent with 2.9 million square feet of net absorption. This is the lowest vacancy rate we have ever recorded in Southern Nevada. For comparison, vacancy only went as low as 3.1 percent during the boom that preceded the Great Recession.  Demand was positive for all industrial subtypes for the first quarter, while rents for warehouse and distribution space increased 46 percent year over year. All industrial sectors added jobs on a year-over-year basis, with the largest increase being in logistics, which added 8,100 jobs. The current industrial boom has been driven by the influx of relocations and expansions from all over the U.S., but primarily from California. Southern Nevada’s strategic location, with its ability to service 12 markets within one day, has also made it an ideal location for regional and national distribution. New industrial completions totaled 2.1 million square feet this quarter, almost all of it being warehouse/distribution product. Southern Nevada is in its third major wave of post-Great Recession industrial development, with more than 8 million square feet now under …

By Shawn Jaenson, Senior Vice President, Industrial Specialist, Kidder Mathews The Northern Nevada industrial market is composed of 98.7 million square feet of industrial real estate spread across six submarkets. Northern Nevada’s centralized location allows for a one-day truck service to more than 60 million customers. Couple that with the fact that Nevada has no corporate tax, personal tax, inventory tax, franchise tax, or special intangible tax and the city is one of the most desirable industrial locations in the Western U.S. What was once thought of as unattainable in Northern Nevada has become the norm as nearly every record or statistic has been shattered and the market continues to show no signs of slowing.  The overall market vacancy rate plummeted in 2021 to 1.7 percent, with a direct vacancy rate of 1.6 percent — a more than 200 percent decrease from the start of the year when overall vacancy rates were 5.3 percent and direct vacancy rates were 4.9 percent. Due to the unprecedented demand, new product in Northern Nevada has never been more crucial as new construction struggles to keep pace with market demand. In 2021, Northern Nevada had a positive net absorption of just over 7 million square feet, which …

By John Stater, Research Manager, Colliers Southern Nevada gained 15,400 industrial jobs between August 2020 and August 2021, according to the Nevada Department of Employment, Training and Rehabilitation. The logistics and wholesale sectors added jobs on a year-over-year basis, while the natural resources and construction sectors lost jobs.  Unemployment in the Las Vegas-Paradise MSA was 8.3 percent in August 2021. Over the past 12 months, total employment in Southern Nevada increased by 55,600 jobs, a 6.1 percent increase. Southern Nevada lost 241,900 jobs between February and April 2020 and had regained 71 percent of those lost jobs by August 2021.  Southern Nevada is in its third major wave of post-Great Recession industrial development, with 6.6 million square feet of product now under construction. The fourth quarter of 2021 could see 2.3 million square feet of product added to inventory. Projects scheduled for completion in the fourth quarter of 2021 are currently 58 percent pre-leased. Projects completed this quarter were 98.8 percent pre-leased when completed.  Net absorption this quarter was a record 4.45 million square feet. This brought net absorption up to 9.79 million square feet year-to-date, higher than the previous record for annual net absorption recorded in 2017. Warehouse/distribution net absorption …