Who is moving here and what do we need to do to keep them?
March 6, 2017
When I first started my newly created position at Dickson Realty — vice president of relocation — I wasn't certain what the scope of my job would entail. At first it seemed I would spend all my time calling on corporate clients, but just like any job it's more complicated than that. While the specifics of my job are different than most, I'd argue that we all need to do a little of what I'm doing to help create the community we want.
I think in order to shape the growth of our community together, we need to get on the same page about growth. It's happening and we need it to succeed. In a normal market nationwide, typical population growth is about 1 percent each year. Nevada is almost double that rate, named one of the two fastest growing states in the last year. We are finally back to our housing prices, population and employment numbers that we had 10 years ago. One would expect growth to surpass the levels we're at today, and that is what is projected to happen.
With the attraction of new companies and startups to our community, the expected amount of jobs projected to our region is 52,400, with a population increase of 64,700 between 2015-2019. This is great news — except that we don't have the workforce to fill these jobs. The recent unemployment rate was marked at 4 percent in Reno-Sparks. There will be tens of thousands of jobs perfect for a talented millennial, but we just need to get them here, and we also need to make our region a place for them to stay.
It's not a shock that housing inventory is not meeting demand. With a surge in companies and people relocating to our area combined with the slow building of new homes and apartments, we have a housing gap. The University of Nevada, Reno Center for Regional Studies reported that the rate of new unit construction per new job is 0.28, and the Economic Planning Indicator Committee (EPIC) reports a housing unit shortfall of 20,000 units by 2020. The rental market is just as challenging, if not worse, with a 2.23 percent average vacancy rate across apartment unit types in Reno-Sparks, as reported in the Johnson Perkins Griffin, LLC Apartment Survey.
With this news, some people want to halt growth. That is not the answer. We need to do the exact opposite and promote it. People love living and doing business here. Millennials want to move here and people actively make the decision to move here because the lifestyle and culture provides us with new places to eat and things to do all year. The price is right, especially compared to our California neighbors, and we have an incredibly favorable business climate. According to Doug Erwin, vice president of entrepreneurship at Economic Development Authority of Western Nevada (EDAWN), "The startup ecosystem has matured from where it's started. We now have a lot of new players and access to new capital funds."
The entrepreneurial team at EDAWN has made tremendous strides attracting startups to our area. Bombora, a B2B data startup based out of New York, moved key team members to Reno, and now has 18 employees. Capstak, a commercial real estate technology company, plans to hire 25 people this year, and Clickbio, an innovative lab tools company, announced it has raised $285,000 in capital. Also, with the recent announcement of Ozmen Ventures, our startups and entrepreneurs have access to a seed and early stage venture capital fund.
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In 2017, startups in our region have already raised more than $25 million — that's nearly double the amount raised in the year prior. Capital is the rain that spurs entrepreneurial growth, which is a critical piece of our regional economic development. The EDAWN team has historically spent 95 percent of their time supporting the ecosystem.
"The big shift for me is putting more energy into attracting startups." Erwin said. "The organic growth is great and it's happening, but at a rate that is slower than if you bring in startup companies with a trajectory for exponential growth."
One recent company EDAWN has attracted is Petrichor. They are a technology startup from Ohio that recently moved four millennial employees, along with high tech salaries. I recently met with their CEO Jake Warner and he said, "The biggest reason we chose Reno is because we needed to live in a place where the talent wanted to move. Everyone here is willing to make introductions and that's a very valuable thing." Petrichor considered Seattle and Austin but ultimately chose Reno after they walked into The Basement downtown. "Driving past it you would never know, but it's finding hidden gems that aren't even in public view yet that tell us this city is growing."
Zazzle, an online marketplace that allows designers and customers to make their own products, recently announced that they are bringing 250 jobs to the region. They are saying similar things. Bridget Smith, vice president of Zazzle said it's very hard to do business from a manufacturing perspective in California. Zazzle chose Reno because of the ease of doing business and also for the quality of life. "We are simply hoping for a better lifestyle for our employees," Smith said.
It's truly an exciting time in Reno-Sparks, and one we have never experienced before. Our population is growing and we are seeking to attract a vibrant and energetic workforce to fill new jobs. We must continue to celebrate, yet prepare strategically for growth. Our aim at Dickson Realty is to have companies and their employees Move with Purpose — to create and support the right growth for our region with a unified relocation strategy that meets the demands of our community. I am thrilled to help lead that charge.
Kylie Rowe is the vice president of relocation for Dickson Realty.