Dear NAIOP Members and Guests,
Welcome to the 2009 NAIOP Northern Nevada Bus Tour. This is our third year in what has been both an exceptionally valuable and enjoyable annual event. In an effort to address the changing business environment, NAIOP’s goal, both nationally and locally, is to make adjustments to our approach in an effort to ensure we maintain relevance to our market and the community that we serve.
One of the key changes you will notice right away is NAIOP’s inclusion of the Retail and Multi-Family/Investment sectors. This year’s tour has a clear focus – the redevelopment of our downtown core, the university area and the key properties within this submarket. We will view and discuss a number of recently built or newly renovated projects as well as projects preparing to break ground that help to further define the “Live, Work, Play” lifestyle here in Northern Nevada.
Our hope is that today’s event will 1) provide information on exciting projects that are shaping the community we live in; 2) meet and network with key principals leading these projects; 3) gain further insight into the future of commercial real estate in our area; and 4) to connect with the many groups and individuals that are a part of and support commercial real estate.
In the months to come, our chapter will maintain its focus of providing a voice in the Legislative Affairs arena on behalf of commercial real estate, which is imperative given the financial pressure under which our government is currently functioning. We will continue to provide opportunities for education, from national webinars to a Development 101 series this fall that will be presented by local industry leaders. Our November luncheon will not only be an outstanding networking opportunity but will be a platform from which a panel of local lobbyists will be able to share their insights and concerns about key issues our industry is facing,
We would like to thank the many sponsors who, despite the challenging economic environment, continue to support this event and the Northern Nevada NAIOP Chapter. Finally, thank you to the Board of Directors and the Bus Tour Committee members who have put countless hours of work into this outstanding event.
Please enjoy the tour!
Brandon J. Page
Chapter President
2009 Northern Nevada NAIOP
Park Center Tower
300 E. 2nd Street
Type: Office
Developer: Basin Street Properties
Leasing Agent: NAI Alliance • Office Team (775.336.4600)
Architect: N/A
General Contractor: N/A
Date Built: 1981
Status: Complete
Project Square Footage: 147,000 SF
Development Acreage: Approx. 1.1
Asking Rates: $1.70/SF Full Service
Major Tenants: Basin Street Properties, Wilks Broadcast Group, State of Nevada
Comments: Right along the Truckee River, this building has amazing views of the surrounding mountains, downtown Reno and the baseball stadium. 300 E. 2nd Street consists of 135,000 square feet of office space, 12,000 square feet of retail space as well as 11 floors of parking. 300 E. 2nd Street is located directly across from the new Reno Aces AAA Baseball Stadium.
Former Reno Brewing Company Site
900 E. 4th Street
Type: Mixed-Use
Developer: Spencer Hobson (775.771.7797)
Leasing Agent: Colliers • Tom de Jong (775.823.6621)
Architect: Frederic de Longchamps
General Contractor: N/A
Date Built: 1940s
Status: Complete
Project Square Footage: 38,000 SF
Development Acreage: 2.5
Asking Rates: No published price
Major Tenants: None
Comments: 4th Street redevelopment opportunity. Three buildings on 2.5 acres. Main building is former site of Reno Brewing Co. and was designed by renowned Reno architect, Frederick Frederic de Longchamps. Includes 65 acre feet of water rights on an artesian well.
Downtown market overview
by Brian Egan, Egan Commercial Real Estate
In a time when our local economy is faced with some very real struggles, the downtown Reno area is ripe with activity and opportunity. While the office submarket, with approximately 1,500,000 square feet of Class A, B and C space, continues to battle high vacancy rates, there are plenty of positive stories to tell about the rest of this vibrant submarket.
In the retail and entertainment sector, new projects continue to drive the momentum. In the last year alone we have seen the successful opening of the new Aces Baseball Stadium, and the developers, SK Baseball/Nevada Land, LLC, have big designs on future phases of retail components to their project. We can expect to see the second phase of SK’s development happening soon, with surrounding bars and restaurants taking shape in such locations as the old Freight House building. Phase III of the project, including the RTC site, is further down the road.
The West Street Urban Market between 1st and 2nd Streets, with its weekly farmer’s market, is developing into a promising hub of activity. It boasts local brand name tenants like Seven Tea House and Bar and Reno Envy, as well as a local bakery that fronts the street. The First Street area is a growing commercial destination with the addition of a new Port of Subs and fresh commercial activity in the ground floor of the Palladio building that includes The Ole Bridge Pub and a Subway restaurant. Also in development just up Virginia Street in the traditional downtown core, is an exciting entertainment venue, “The Knitting Factory.” This successful national concert hall and promotions group plan to bring big name acts into the downtown core in an adaptive re-use of the old Rocky’s Casino location. The 18,000 square foot space right by the Reno arch will pull both locals and tourists into the heart of downtown.
Distinct districts in the downtown periphery, like California Avenue, also continue to thrive. The new addition of locally owned and operated businesses such as Freeman’s Natural Hot Dogs, the Biggest Little City Club, Rubicon Deli, Washoe Wine Company, and St. James Infirmary create traffic, visibility, and excitement about the Reno core as a destination for locals.
We continue to watch promising adaptive commercial spaces like the Montage, 100 S. Sierra Street, 445 S. Virginia and new ground up projects like MTK’s State Street project, and the live-work “Thoma Street Lofts” for new activity. With several other projects currently entitled and/or in the works, we can see that downtown Reno is embracing and realizing the “Live-Work-Play” concept that defines urban cores around the country.
100 N. Sierra Street
Type: Mixed-Use
Developer: Union Property Capital
Leasing Agent: NAI Alliance • Investment & Office Teams (775.336.4600)
Architect: N/A
General Contractor: N/A
Date Built: N/A
Status: Complete
Project Square Footage: 56,000 SF
Development Acreage: 0.32
Asking Rates: Sale Price – $2,800,000 or $50/SF • Lease Price – $1.75/SF NNN
Major Tenants: Vacant
Comments: Great opportunity for retail users, owners, developers to acquire a building on one of the best retail corners in downtown Reno. Spaces are also available for lease with multiple configuration options available. Building consists of four (4) floors, each 14,000 square feet, and all are cleared of old walls, finishes and are available for reconfiguration.
River’s Edge
First Street & N. Sierra
Type: Mixed Use
Developer: DT Developers LLC • Kelly Bland (775.336.4600)
Leasing Agent: NAI Alliance • Kelly Bland (775.336.4600)
Architect: Jeff Frame
General Contractor: Moody Weiske
Date Built: 2005
Status: Complete
Project Square Footage: 4,812 SF
Development Acreage: 7,492 SF
Asking Rates: $2.50/SF + NNN
Major Tenants: N/A
Comments: Prime retail location situated along the river district at the SWC of First and Sierra Street. Property is adjacent to a 12 screen movie theater and directly across the street from a 643 parking gallery. Available space is equipped with a 3,000 gallon shared grease interceptor. Two hour validated parking is included.
Retail market overview
by Shawn S. Smith, CCIM Colliers International
The united prayer of commercial real estate brokers for a positive retail quarter fell on deaf ears. The vacancy rate escalated to 15.42%, from 14.98% last quarter, but we had positive absorption of 249,752 square feet for the second quarter of 2009. The positive absorption is great news and was due to scattered infill projects, second phases of successful shopping centers and the Legends at Sparks Marina, which came online with 273,402 square feet of new construction, which includes over 20 new retail outlet stores.
After the retail carnage of 2008, we hoped to see a slowdown of store closures. However, both national and local retail sectors struggle and continue the long freefall down the rabbit hole as only a few stores have been backfilled. Grocery anchored centers have faired well as shoppers prepare more food at home and have decreased discretionary spending. Power centers, home to junior anchor boxes, have not faired well because of the reliance on disposable income. Junior anchors have led the charge in closing stores, mostly through national bankruptcies and acquisitions that represent over 900,000 square feet of vacant space.
Shop space activity has not faired well, due to a weak economy and housing market, the anchorless centers have resulted in the biggest shop tenant loss because anchors help generate traffic which helps impulse purchases for the smaller inline tenants. Shop space rents have fallen by $0.25 in the second quarter of 2009, to $1.65 per square foot per month, triple net. This is a direct reflection of aggressive leasing tactics being implemented by landlords. We have also seen an increase in rent abatement and a decrease in tenant improvement dollars. Lease terms are being shortened, due to landlord’s hedging against the turn-around of the economy and if a landlord is lucky enough to see a five or ten year deal, the early lease termination kick out clause has reared its ugly head and is tied to gross revenues of the business.
It will be a couple more years until we see the end of national and local store closures. Until we absorb the existing vacant space, construction will be at a standstill for a few years. The stabilization of the housing market is also paramount, as retail needs rooftops to survive and expand. In addition, unemployment needs to show signs of a reversion and banks still need to free up capital and start lending again. Tenants are in the driver’s seat and need to take advantage of the fantastic deals that could be had by locking in rock bottom lease rates, at prime retail locations, for years to come.
The Palladio
Sierra Street & 1st Street
Type: Mixed-Use
Developer: N/A
Leasing Agent: NAI Alliance • Office & Retail Teams (775.336.4600)
Architect: N/A
General Contractor: Clark & Sullivan
Date Built: 2007
Status: Complete
Project Square Footage: 6,680 SF (Office) • 13,249 SF (Retail)
Development Acreage: N/A
Asking Rates: Sale Price – $70-$125/SF • Lease Price – $1-$2/SF NNN
Major Tenants: Old Bridge Tavern, Subway
Comments: Located in the heart of the downtown Reno redevelopment district, The Palladio offers future tenants Class A space with close proximity to all of downtown’s amenities. Retail and office space is available with exterior windows that stretch the height of the space giving excellent views of the Truckee River and downtown. Most of the spaces are currently in shell condition and are available for sale or lease.
445 South Virginia Street
Virginia St. near California Ave.
Type: Multi Use
Developer: DP Partners • Dermody Properties
Leasing Agent: Egan Commercial • Brian Egan
Architect: N/A
General Contractor: United Construction
Date Built: 1942
Status: Complete
Project Square Footage: 17,740 SF
Development Acreage: 1.15
Asking Rates: $1.35 NNN
Major Tenants: AJ Kirkwood (Electrical Contractor)
Comments: Located in the heart of downtown Reno, this single user or multi-tenant building is ideal for a user looking to take advantage of the various amenities in this “Live, Work, Play” area of Reno. The building comes with surface street parking, is located in the redevelopment district which includes; the Truckee River, UNR, Pioneer Theatre, train station, court house, easy access to public transportation and frontage on both S. Virginia and Sierra Streets.
Bank of America Plaza
S. Virginia & W. Liberty
Type: Office
Developer: Basin Street Properties • Scott Stranzl (775.329.4131)
Leasing Agent: NAI Alliance • Office Team (775.336.4600)
Architect: N/A
General Contractor: N/A
Date Built: 1980
Status: Complete
Project Square Footage: 249,349 SF
Development Acreage: Approx. 1 acre
Asking Rates: $2/SF Full Service
Major Tenants: Bank of America, Lewis & Roca, New York Life, Lionel Sawyer & Collins
Comments: 50 West Liberty is Reno’s premier business center, consisting of two office and retail towers totaling 248,000 square feet. It is located on the corner of S. Virginia and W. Liberty in the heart of downtown Reno. 50 West Liberty has secured covered parking, spectacular mountain views, a bank and many other amenities.
US Bank Building
300 S. Virginia St.
Type: Office
Developer: Security Pacific Bank
Leasing Agent: NAI Alliance • Investment & Office Teams (775.336.4600)
Architect: N/A
General Contractor: N/A
Date Built: 1974
Status: Complete
Project Square Footage: 82,858 SF
Development Acreage: 0.95
Asking Rates: Sale Price – $10,500,000 or $126.72/SF • Lease Rate – $1.85 FSG
Major Tenants: US Bank, Navellier
Comments: The property consists of six stories of well appointed office space situated on 0.95 acres. The building provides on-site surface and secured structure parking, an amenity benefiting only a few of Reno’s downtown office properties. Constructed in 1974, and renovated in 1993, this 82,858 +/- leaseable square foot building is the keystone to Northern Nevada’s central business district.
State Street Plaza
170 S. Virginia Street
Type: Mixed-Use
Developer: MTK Limited • Mike Perkins (775.412.8809)
Leasing Agent: NAI Alliance • Office & Retail Team (775.336.4600)
Architect: Mercedes de la Garza
General Contractor: United Construction
Date Built: 2009
Status: Under Construction
Project Square Footage: 16,000 SF
Development Acreage: Approx. 0.34 acres
Asking Rates: Negotiable
Major Tenants: N/A
Comments: State Street Plaza is a newly constructed mixed-use building in downtown Reno. The first floor is proposed as retail and the second floor as office. However, one tenant could take the entire building, 16,000 square feet, if needed. It is located with close proximity to many downtown amenities and ownership opportunities are available.
Gui Denby Building
855 S. Center Street
Type: Mixed-Use
Developer: N/A
Leasing Agent: Colliers International • Tim Ruffin & Melissa Molyneaux (775.823.9666)
Architect: Gui Denby
General Contractor: N/A
Date Built: 2009
Status: Complete
Project Square Footage: 8,220 SF
Development Acreage: N/A
Asking Rates: $1.70/SF Full Service
Major Tenants: Gui Denby
Comments: New two-story office and retail building in downtown Reno. Construction is planned to be complete by May 2009. Two spaces being leased are in shell condition. Landlord is willing to do a turn key build-out. Green building promotes a healthy working environment and social responsibility. Building signage available. Full Service lease rate includes utilities, janitorial fees and CAMs. Lot and street parking available.
201 W. Liberty Street
Type: Office
Developer: AMH Properties • Marion Hose (775.322.1025)
Leasing Agent: AMH Properties • Marion Hose (775.322.1025)
Architect: N/A
General Contractor: Tico Construction
Date Built: 1972
Status: Renovated 2005 / Complete
Project Square Footage: 29,000 SF
Development Acreage: 0.99
Asking Rates: $1.85/SF
Major Tenants: EDAWN, Tico Construction, AMH Properties
Comments: 4-story building directly across from Nevada Museum of Art. Recently renovated, including lobbies, high-speed elevators, on-demand afterhours HVAC, state-of-the-art lighting. Highest parking ration in downtown. Enjoy Reno’s downtown renaissance – walk to the Truckee River, Nevada Art Museum, restaurants, entertainment, County and Federal courts.
Museum Tower
100 W. Liberty
Type: Office
Developer: Chawin Property, Inc.
Leasing Agent: Colliers International • Tim Ruffin & Melissa Molyneaux (775.823.9666)
Architect: N/A
General Contractor: N/A
Date Built: 1987
Status: Complete
Project Square Footage: 257,747 SF
Development Acreage: N/A
Asking Rates: $2/SF Full Service
Major Tenants: Jones Vargas, McDonald Carano Wilson, Grant Thorton, Wachovia
Comments: Class “A” Building in the Central Business District at the corner of Liberty and Sierra Street. First floor suite available with private entrance and outstanding exposure from Liberty Street. Covered and secure parking in parking garage that is served by the main elevator bank. Well maintained building with on-site property management office. Tenant’s have access to fitness facility on the ground floor at no cost.
Office market overview
by Matt Grimes, NAI Alliance
Northern Nevada’s office market is sitting idle waiting for employers to feel some relief. The economic domino effect has bolstered Northern Nevada’s unemployment rate to 11.8%, thus creating a flurry of activity based on the need for companies to reduce their occupancy costs. This activity is un-constructive to overall market absorption, which makes the 2nd quarter of 2009 the eighth consecutive quarter with negative net absorption. The quarterly rate of decline is improving; a relatively minimal increase in vacancy took place in the 2nd quarter, which could be signaling a bottom.
Office vacancy rates have reached all time highs in nearly every Northern Nevada submarket. The South Meadows submarket has been hardest hit by the economic downturn peaking at 32% (including sublease space) throughout 2009. The recent user purchase of the 25,000 SF, Thomas Creek Building Two, has reduced this submarket’s vacancy rate to approximately 28.5%, however there is still a long way to go before this submarket will be considered healthy.
The downtown submarket has also experienced a steady increase in vacancy rates, although Reno’s Central Business District is much more in line with our overall market vacancy. The recent departure of the Harrah’s 45,000 SF corporate headquarters from 300 E. 2nd Street increased the downtown market vacancy to 21.13% from 18.70% at the end of 2008.
The 18,000 SF State Street Plaza in downtown Reno is and should be the only new construction to take place in 2009. We do not foresee any other new speculative construction taking place until vacancy rates decrease to sub 15%. This decrease in vacancy will account for a required absorption of approximately 1,100,000 SF.
There is also a considerable amount of office space that sits vacant in shell condition. This shell space will be slow to lease as landlords with existing 2nd generation vacancy can usually offer lower effective rents.
The aforementioned have had obvious impacts on lease rates and the tenant’s ability for pre-termination renewals at discounts that rival the asking rates of 2000 – 2002. The imposition of ‘for sublease’ incentives have driven average asking rates down by a minimum of 15%. While trying to retain the anticipated long term income, landlords are faced with offering one month rent free per every year of the lease term in addition to lower rates and turn-key tenant improvements. This is what it takes to retain and attract tenants.
The current economic woes have created hesitancy in every market, resulting in a reluctance of tenants, landlords, buyers, sellers, developer and financiers to, as we say in Nevada, ‘play a hand’. The enduring hope is that the Northern Nevada Office Market will settle at its low by mid 2009 and begin to strengthen at the core as we roll into 2010. The underlying precipitance for this core strengthening will be the correction of the cost of living, namely the housing market, and the reminding celebration, once again, of Northern Nevada’s quality of life and advantageous tax-friendly business climate.
275 Hill Street
Type: Mixed-Use
Developer: AMH Properties • Marion Hose (775.322.1025)
Leasing Agent: AMH Properties • Marion Hose (775.322.1025)
Architect: Cathexes • Wikoff Design Studio
General Contractor: Tico Construction
Date Built: 1959
Status: Renovated 2009 / Under Construction
Project Square Footage: 16,442 SF
Development Acreage: 0.32
Asking Rates: Retail Price – $2/SF NNN • Office Price – $1.85 -$2/SF
Major Tenants: N/A
Comments: Fabulous redevelopment in the heart of Downtown – urban chic office/retail – 1 block from the Truckee River and Wingfield Park, Courthouse, banks and retail. Bordered by the Truckee (north), Arlington Street (west), courthouses (east) and Liberty Street (south). Retail space is in the direct path of attorney/client foot traffic to and from courthouses.
241 Ridge Street
Type: Office
Developer: AMH Properties • Marion Hose (775.322.1025)
Leasing Agent: AMH Properties • Marion Hose (775.322.1025)
Architect: N/A
General Contractor: Tico Construction
Date Built: 1972 / Remodeled 2005
Status: Complete
Project Square Footage: 32,000 SF
Development Acreage: 0.67
Asking Rates: $1.75/SF
Major Tenants: Western Title, Great Basin Internet, Sierra Capital Resources, Secure Storage Technology
Comments: Four-story with secure underground parking in the heart of Reno’s downtown area. Complete renovation in 2005 including building systems. On-demand afterhours HVAC, fiber to building. Plentiful parking. Enjoy Reno’s downtown renaissance – walk to the Truckee River, Nevada Art Museum, restaurants, entertainment, county and federal courts.
Multi-Family & Investment market overview
by Dewey Struble, CCIM, Sperry Van Ness Commercial Real Estate Advisors
Investment Market
With the overall economy weakness, deteriorating fundamentals, and the dearth of credit available in the commercial investment real estate market, times are TOUGH! Investment sales were down over 90% nationally in the first half of 2009. This dropped even more from the weakness experienced in 2008.
Locally, we have also experienced very weak fundamentals, and in what has been a rare occurrence, actually worse than the national averages. This is especially noteworthy in the sky high unemployment numbers. Northern Nevada certainly was not immune from the housing crash and that overbuilding and credit disaster started the bad swing here, and faster than in almost all other areas of the United States. Office buildings felt this immediately, and subsequently retail properties. The primary issue for nearby industrial was driven by an oversupply of product, when coupled with the weak fundamentals, hurt the big boxes dramatically.
As a Secondary-Tertiary market, Northern Nevada is even more impacted than larger markets by the “credit crunch”, and when combined with the horribly weak economic fundamentals, sales have been virtually non-existent in 2009, and even worse than in late 2008. As occurred nationally, cap rates have been increasing and prices decreasing. This negative trend actually almost doubled in early 2009 from late 2008. On a brighter note, this downturn should slow down as we go further into 2009, and turnaround in 2010. Reno-Sparks fell quickly when the downturn hit, but we should expect a relatively faster upswing once things turnaround in Northern Nevada.
Multi-Family Market
The national multi-family market is a significant part of the properties that were sold or refinanced in the past five years in amounts totaling some $2.2 Trillion. Many of these properties were leveraged in this five year period at a 70-80% level, and now are “troubled” since values have dropped so far that there is now little or negative equity. Prices for sold properties have dropped some 35-40% nationally, and while not good, apartments have only dropped some 15-20%. Unique in the market today, there has also been a pickup in sales of apartment complexes in the second quarter of 2009, especially in smaller and mid-sized complexes.
The plus for apartments nationally and locally has been the constraint on adding additional supply in the markets. As with all real estate of late, the challenges involved in obtaining credit has also impacted the multi-family markets, just not to the same levels as other product types. With the federal governments behind HUD, Fannie Mae and Freddie Mac, which has accounted for more than 60% of recent multi-family financing, the credit crunch has not been as bad for apartments.
For the first time in recent history, multifamily sales increased nationally in the second quarter of 2009. The same could not be said locally, but an uptick in transactions is expected in Reno-Sparks by the end of 2009. Offering prices have finally started to decrease and the former problem of unrealistic expectations of both sellers and buyers creating a large bid-ask spread is beginning to be mitigated as cap rates increase somewhat.
Arlington Towers
100 N. Arlington
Type: Mixed-Use
Developer: Blackfire Investors (888.678.6660)
Leasing Agent: CBRE • Chris Waizman, Gary Tremaine, David Woods,
Vanessa Vandenberg
Architect: N/A
General Contractor: N/A
Date Built: 1966
Status: Complete
Project Square Footage: 10,744 SF
Development Acreage: N/A
Asking Rates: $1.15 NNN / $0.71 CAMS
Major Tenants: Se7en Teahouse & Bar, Yogic Lounge, Aquarius,
Desert Diamond Realty
Comments: Building is located on the ground floor of Arlington Towers on the corner of First and Arlington. The property offers 4,898 square feet that is perfect for a retail/office user. It has great visibility in a high traffic location with views of the Truckee River. Close proximity to Wingfield Park’s amphitheater, the Whitewater Kayak Park and Century Theatres.
100 & 140 Washington Street
Type: Office
Developer: AMH Properties • Marion Hose (775.322.1025)
Leasing Agent: NAI Alliance • Office Team (775.336.4600)
Architect: Cathexes (for 2008 renovation)
General Contractor: Tico Construction (for 2008 renovation)
Date Built: 1969
Status: Complete
Project Square Footage: 32,000 SF
Development Acreage: Approx. 1 acre
Asking Rates: $1.20/SF – $1.49/SF Full Service
Major Tenants: Understand.com, The Laughton Company, Gatson & Wilkerson
Comments: 100 & 140 Washington have completely renovated interiors that provide a professional and contemporary atmosphere. Located on the corner of 1st Street and Washington Street they are one block from the Truckee River and located near multiple amenities. These buildings also have ample, on-site and free parking with building signage available for a large user.
Industrial market overview
by Mike Nevis, CB Richard Ellis
The Northern Nevada industrial market has officially shifted to a tenant’s market. In today’s market a tenant can take advantage of a new building with better features at a more economic rent than they are currently paying coupled with lower operating costs due to better building efficiency. Tenant’s who can continue to operate in a 2nd or 3rd generation building are taking advantage of renewal rates rolling back to 5+ years ago. Tenant Improvement costs have come down as much as 30% in some cases helping Landlord’s shoulder some of the decreases in rent they are currently experiencing.
In the first half of 2009, market activity was quiet and available inventory increased to record levels. The good news for landlord’s is that with a lack of speculative construction and increasing activity levels, vacancy should stabilize and decrease. There are several large lease transactions pending on big box speculative projects that would reduce the current vacancy number back down to 12-13% by year’s end. Additionally, companies who put their requirements on hold during the last year are starting to return back to the market in hopes of hitting the market right and realizing a great deal.
The overall available rate in the Northern Nevada Industrial market for the 2nd quarter of 2009 was 14.97% decreasing from 15.07% during the 1st Quarter of 2009. With the lack of new speculative construction taking place, the decrease in vacancy is due solely to companies taking advantage of historically low rental rates for expansions or relocations planned prior to market downturn. The core submarkets of South Reno and Airport still remain the tightest in terms of vacancy with the East Valley and Sparks leading the list with the largest vacancy overall.
New leasing activity or gross absorption hit 1,641,641 square feet, while Net Absorption remained negative 1,346,196 square feet year to date. It is likely that the market will not be able to overcome this loss and will remain negative at year’s end. Almost all submarkets have recorded YTD negative absorption, with the exception of the East Valley submarket with positive 303,357 square feet. In addition, the Reno/Sparks mid-year gross absorption levels are higher in 2009 as compared to 2008 when it recorded 1.3MM square feet.
Rates on new speculative product over 100,000 square feet are being hit the hardest as the latest phase of completions are all vying for the few deals in this size range. Our average effective rent on a 50,000 sq.ft, 5-year deal has fallen to $.285 PSF per month NNN.
Grant’s Landing
Mill Street & E. 2nd Street
Type: Mixed-Use
Developer: Silver Star Communities
Leasing Agent: NAI Alliance
Architect: N/A
General Contractor: N/A
Date Built: N/A
Status: For Sale
Project Square Footage: N/A
Development Acreage: 5.57
Asking Rates: $35/SF
Major Tenants: N/A
Comments: Truckee River frontage, directly adjacent to the new Reno Aces Ballpark. The portion for sale is approximately 3.57 acres with frontage directly on Mill Street and the Truckee River. The overall availability of the site totals 5.57 acres, although there is currently a letter of intent on a portion of the site.
St. Mary’s Medical Plaza
236 W. 6th Street
Type: Office
Developer: N/A
Leasing Agent: NAI Alliance • Scott Beggs (775.336.4600)
Architect: McKenzie Properties
General Contractor: N/A
Date Built: 1981
Status: Complete
Project Square Footage: 43,323 SF
Development Acreage: 0.31
Asking Rates: Sale Price – $6,410,000 or $162.81/SF
Major Tenants: Pulmonary Medicine Association
Comments: The property is a hundred percent leased medical office building located directly across the street from St. Mary’s Hospital. The below market in-place rents and opportunity to stagger lease terms provides a future owner the ability to create value by improving space and achieving market rental rates.
800 Stillwell Road
Type: Industrial
Developer: AMH Properties / Marion Hose (775.322.1025)
Leasing Agent: NAI Alliance • Paul Perkins and Industrial Team (775.336.4600)
Architect: N/A
General Contractor: Tico Construction
Date Built: 1956
Status: Complete
Project Square Footage: 120,000 SF
Development Acreage: 4.18
Asking Rates: $0.25 NNN
Major Tenants: N/A
Comments: Recently renovated building on 4.18 acres of land. Sprinkled throughout, separately metered, covered loading areas, new parking lot with additional parking possible. Near downtown Reno, adjacent to the University of Nevada, Reno land. Access to Interstate 80 and US Hwy 395 and directly accessible to McCarran Blvd loop encompassing Reno.
101 North Virginia
Type: Mixed-Use
Developer: 101 North Virginia, LLC
Leasing Agent: Retail – Colliers • Shawn Smith (775.823.4662), Office – AMH Properties • Marion Hose (775.322.1025)
Architect: Frame Architecture
General Contractor: Tico Construction
Date Built: 1966
Status: Under Renovation
Project Square Footage: 72,000 SF
Development Acreage: 14,000 SF
Asking Rates: Retail – $1 NNN, Office – TBD
Major Tenants: N/A
Comments: 101 North Virginia consists of approximately 12,000 square feet of prime retail and 60,000 square feet of strategic office space in the heart of downtown Reno, one-half block from the Truckee River. The office tower, located directly above the retail, is accessed separately through an office tower lobby and two elevators. The entire building is undergoing aesthetic and system upgrades.
Vassar Cordone Nonprofit Center
1301 Cordone Ave., Reno, NV 89502
Type: Office
Developer: AMH Properties • Marion Hose (775.322.1025)
Leasing Agent: Stark & Associates • Ricci Rodriguez & Bob Schrimpf (825.4400)
Architect: N/A
General Contractor: Tico Construction
Date Built: 1972
Status: 2008 Renovation / Complete
Project Square Footage: 25,000 SF
Development Acreage: 0.67
Asking Rates: $1.20 – $1.45 SF
Major Tenants: Alzheimer’s Association, NV Microenterprise Institute, Friends of Washoe Library, Sierra Nevada Journeys
Comments: Completely renovated in 2008 and features a vibrant look. This collaborative environment is perfect for non-profit organizations and social service agencies serving similar clients. Common areas include training and board rooms, kitchen and coffee bars. Rentable secured storage is available. Penthouse suite square feet includes patio with a view.
