The Las Vegas Valley is beginning to rebound from the Great Recession. Home values have steadily climbed, unemployment has crept down slightly and the downtown revitalization continues. But the rebound could have been much bigger by now and even more promising later if not for one problem: space.
Many large companies again want to move to Southern Nevada, but they need industrial-sized space, something the region lacks. Yes, there are plenty of vacant industrial buildings (more than 1 in 10 are vacant), but these companies need far more than the available buildings offer. And we’re losing out on huge job-creation opportunities because of that, as noted in an April 13 op-ed by Jonas Peterson, chief operating officer at the Las Vegas Global Economic Alliance.
The LVGEA recently conducted a study in conjunction with RCG Economics showing that the region lost out on as many as 18,000 jobs in the past year due to the lack of large industrial buildings — primarily buildings of 175,000 square feet or more. In 2013, 52 percent of large industrial businesses that considered relocation were in the manufacturing industry, a sector that often offers high wages and significant capital investment. But the study noted that almost all of those businesses — 94 percent — cited a lack of building inventory as a reason for opting against moving to Southern Nevada. As Mr. Peterson wrote, “We have buildings, but we don’t have the right buildings.”
Mr. Peterson said that other regions, namely Phoenix and Southern California’s Inland Empire, either have those buildings or are moving quickly to build such structures, luring companies that could have instead been here in Southern Nevada. The Review-Journal’s Jennifer Robison on April 9 reported that Las Vegas’ total industrial inventory was just over 100 million square feet at the end of 2013, not much more than Reno’s 75 million square feet, and miles behind Phoenix’s 275 million square feet.
The report shows there is value in studying what other states are doing to land more businesses. Now Southern Nevada has to follow that blueprint. Government can and should only do so much. It’s up to the private sector and developers to step up and invest in adequate space. As Mr. Peterson stated, “In short, build it and they will come.”