For the past year, the “Tesla Effect” and the EPIC report have dominated discussions about the economic future of northwestern Nevada. Expect that to continue.
Late in 2014, Tesla announced it would build the largest lithium-ion battery factory in the world in partnership with Panasonic in the Tahoe Reno Industrial Center.
That drew more attention to the area. If Tesla liked what it saw, Reno must have something special.
Other companies looking to move, expand or set up shop started taking a closer look at what the Reno/Sparks market had to offer. The economic pace, already rebounding from the Great Recession, accelerated.
Seeking to quantify the expected growth, a committee of 33 representatives from state and local governments, education institutions, community partners and planning agencies — the Economic Planning Indicators Committee (EPIC) under the umbrella of the Economic Development Authority of Western Nevada (EDAWN) — put their heads and resources together and commissioned RCG Economics LLC to research and forecast what the region could expect in the next five years.
By the time the EPIC report was officially released in September, its core prediction of 47,400 to 56,600 new jobs and a population growth of 42,400 to 64,700 by 2020 was already the talk of the region. The report presents four possible scenarios with varying degrees of growth depending on an abundance of factors.
In 2016, actual numbers will be compared to the forecast graphs.
No matter how the real numbers move the lines, bars, pie charts and other data, growth is already evident.
In the last 12 months, EDAWN has brought in 30 companies that announced they would be moving to the area (many have already set up shop), and three existing businesses expanded. Collectively, they promised to bring an additional 3,000 jobs to the area in the next few years.
“2015 was another impressive year, with over 25 new or expanding companies adding over 3,000 new quality jobs to the region over the next few years and that does not include the thousands of secondary jobs (such as construction and retail),” Mike Kazmierski, president and CEO of EDAWN, said at the EDAWN New and Expanded Company Welcome Reception, an event held earlier this month to welcome the new companies.
“As we continue to build on our recent success, there is no doubt that our economy is recovering and we are on the cusp of a truly new economy.”
Evidence of the new economy includes the decline in the unemployment rate. November, with an unemployment rate of 6.4 percent statewide, represents the 57th consecutive month the rate has been lower than the previous year, according to the monthly report from Nevada’s Department of Employment, Training and Rehabilitation (DETR).
Reno is fairing even better. In October, the latest figure available for specific regions, the Reno area had an unemployment rate at 5.6 percent, according to the Bureau of Labor Statistics. That’s down from 14 percent in October 2014.
The construction industry, which lost a substantial number of its jobs during the recession, is again booming. The number of people in the construction industry in Reno has increased 1.7 percent to 11,800 people in November of this year. That compares to a low of 7,700 in the depth of the recession.
Many buildings and districts in the heart of Reno/Sparks — areas in decline even before the Great Recession hit — are seeing resurgence.
Midtown is turning into a haven for Millennials and entrepreneurs with expanded and upgraded retail, dining, and housing.
In Downtown, the Kings Inn, boarded up for three decades, is being reborn as an upscale apartment complex.
The Northtowne Walmart, which closed five years ago, has been partly filled by Teleperformance USA, which is bringing 500 new jobs to the area.
Victorian Square in Sparks is getting a major reinvention with the remodel of the old Silver Club Hotel into urban apartments, the remodel of the Bourbon Square casino into a retail/dining/office complex and, on the opposite side of the square, construction of a new apartment complex on land formerly occupied by a parking lot.
Houses and apartments are under construction at a feverish pace throughout the area. Even with all the housing activity, economists emphasize a need to build more homes to keep up with growth.
The sale of existing homes has slightly slacked off, not because of lack of interest but because of lack of inventory.
In November, the Reno market had 3.8 months supply of inventory. A balanced market has 5 to 7 months of supply. Low inventory causes prices to increase while the number of sales goes down.
The coming year will have its challenges but overall the area economy is on a healthy track.
“The Reno, Sparks and Fernley (housing) markets have a lot to look forward to in the coming 12 to 18 months,” said Dave Hansen, outgoing president of the Reno/Sparks Association of REALTORS.