Adam Seger is keen on industrial development in Northern Nevada, but the principal at Indianapolis-based Pure Development said it’s quite a different process to find — and clear — land in the Silver State than in his home state of Indiana.
“The Bureau of Land Management owns a lot of the land (in Nevada),” Seger told NNBW last week during an interview to discuss Pure Development’s three industrial projects at Tahoe Reno Industrial Center. “It’s different from where we were founded in Indianapolis, where you just go to the next cornfield (if you want to purchase developable land).
“Sitework was also unknown with the amount of rock and microblasting we had to do,” Seger added. “For some of us cornfield and soybean field developers, there was a little bit of anxiety.”
There haven’t been many sleepless nights or all-hands strategy meetings as Pure Development advanced its construction efforts in Northern Nevada. The company’s first industrial project in TRI, a 354,640 square-foot industrial building on Pittsburgh Avenue, was completed this past summer and was fully leased soon after. Matthew Harris, Benjamin Harris and Christian Stolo of Street CRE represented Pure Development in lease negotiations for the facility.
Pure Development, like many longtime Northern Nevada industrial developers and the handful of relatively new players to enter the regional industrial development arena, said Northern Nevada checked all the boxes for its investment capital.
“Build-to-suits were how Pure Development got started, and that’s still our bread and butter, but when you get down to it, we were often looking for sites for our clients,” Seger said. “A number of times we realized we were (looking at places where we were) not going to go to market, but we had found a great site. That’s what brought us to Reno.”
Seger said Pure Development executives honed in on TRI for the very reasons the park was built, including speed to market, infrastructure, and a business-friendly state. Industrial rents have been increasing in key California markets such as the San Francisco Bay Area, Sacramento, and Inland Empire, Seger noted.
“We were really intrigued by the Reno market and wanted to buy some land and go vertical,” he said. “There also is a parallel that was really big to us. Kidder Mathews, CBRE, Street CRE, all their reports show that Reno is one-day’s drive to 60 million people. In Indianapolis, we are one-day’s drive to 60-percent of the population of North America. Those metrics mean a lot for distribution, and those were the factors that really led us to want to be in this market.”
Pure Development bid on multiple land sites before it was finally able to secure an approximately 25-acre parcel off Pittsburgh Avenue. A year later, Pure Development’s capital partner, Valeo Real Estate 2.0 of Carmel, Ind., greenlighted purchase of two additional sites on Peru and Denmark drives at TRI. The site on Peru was pad-ready, and Pure Development anticipates delivery of a 410,750 square foot building before the end of January. A 321,000 square-foot building is under construction on Denmark Drive and is expected to be delivered by June, Seger said.
Seger noted that there already have been lease proposals put forth on both buildings, but no contracts have been inked. Both buildings have 32-foot clear heights, and the Peru site has additional room for trailer parking, he said. Pure Development constructed standard office space and restroom facilities inside the Peru Drive building and will do the same at Denmark Drive to hasten time-to-occupancy for prospective tenants.
“They are really ready to go,” Seger said. “Speed-to-market is the name of the game.
“There’s so much learning when you enter a market,” he added. “We had great success on the first building getting it leased up to a single tenant, and we remain hopeful for the next two buildings. We are still looking for land, and we want to be in this market for a long time.”
Arco Murray Design Build of Downers Grove, Ill. is the general contractor on all three buildings. Kimley-Horn of Reno is the civil engineer for all three projects, while F&P Construction of Reno handled all the dirt work at Denmark Drive. Ware Malcomb of Irvine was the architect on the first building. The industrial team at CBRE is the broker for the two buildings under construction.
Seger said now that Pure Development has assembled a development and brokerage team it’s searching for its next play in Northern Nevada.
“We really like the people we are doing business with in Reno,” he said. “We have built a great team, we are having fun, and Reno makes sense from a business standpoint. This is an important market for us.
“We like Reno as a city and the proximity to Lake Tahoe – it’s a nice place to visit when you are checking out your real estate. But most of all, we like the economic drivers of Northern Nevada. Tahoe Reno Industrial Center is a master-planned park that has good power, and Storey County is a great place to do business as well.”
Link to the original article: nnbw.com