Monster's new distribution center is located at 3817 Bay LakeTrail, within Las Vegas Corporate Center in North Las Vegas. CBREbroker Donna Alderson, who represented Monster, says the negotiatedlease rate is a market rate for that size of a lease in the NorthLas Vegas submarket. "That is an extremely large tenant for ourmarket," Alderson says. "That is why the lease rate was socompetitive."

|

The Valley-wide vacancy rate for warehouse/distribution spaceended the year at 4.4% (1.77 million sf) and the average triple-netasking rate for such space was about $0.63 per sf per month. Withan asking rate in the low $0.50s per sf per month, North Las Vegasis the least expensive submarket in the region forwarehouse/distribution space. Near McCarran International Airportat the south end of the Las Vegas Strip, the average triple-netasking rate for warehouse/distribution space is more than $1 persf.

|

Speaking specifically about the warehouse/distribution market,Alderson says there continues to be a healthy supply and consistentdemand. "Demand for the small, for-sale stuff has softened up quitea bit as lending requirements have tightened but thewarehouse-distribution market has held up," she says. "Demand hassoftened up a little bit, but there is still solid activity in thatproduct type."

|

The overall Las Vegas industrial market expanded by sevenmillion sf in 2007 to 96.4 million sf, according to AppliedAnalysis. Net absorption was 4.4 million sf. The 2.6-million-sfdifference between supply and demand pushed up the average vacancyrate to 6% at the end of the year from 3.5% at the end of 2006. Atthe start of 2008, an additional 4.7 million sf was underconstruction. Manufacturing posted the lowest vacancy rate, at4.5%, while Flex space posted the highest vacancy rate, 7.1%.

|

"As the overall economic climate continues to cool andresidential development activity has reversed course from the highsreported two and three years ago, development opportunities in theindustrial sector have emerged in force," says Applied Analysisprincipal Jeremy Aguero. "This is not to suggest an oversupplycondition exists, but rather a more balanced mix of activity islikely to prevail, coming off a period of record low vacancies. Weexpect vacancies to remain below historical averages and settle inthe mid to high single-digits in the coming year, while pricing forindustrial product will not likely retreat."

|

ProLogis dramatically increased its ownership in the Las Vegasmarket and Nevada in general last year when in partnership withLehman Bros. it acquired a 24.7-million-sf portfolio from DermodyProperties and CalSTRS for $1.8 billion. With more than 60% of theportfolio in Nevada, the deal instantly gave ProLogis a leadingposition in the state.

|

The deal included 12 million sf in the Reno area and fourmillion sf in the Vegas area, including one million sf within LasVegas Corporate Center, taking its ownership there to 2.5 millionsf in 12 buildings. ProLogis says its only availability at LasVegas Corporate Center is the remainder of the 500,000-sf buildingin which Monster Cable will be located.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.