Panattoni commits to Fernley site
Panattoni Development Co. has committed to purchase 100 acres in Fernley and plans construction of 2.4 million square feet of distribution center space.
The deal again demonstrates that big industrial projects no longer can find much available land in Reno or Sparks. Panattoni is nearly built out on a major industrial complex at Stead.
The development company doesn’t yet have tenants for the Fernley space, said Jason Quintel, a Panattoni partner in Reno. But it’s betting that national companies looking for West Coast distribution will give Fernley a close look.
The willingness of a major developer to undertake big speculative construction in Fernley is yet another indication that the location 30 miles east of Reno is becoming a key part of the region’s economy.
The town is the site of several major industrial facilities an Amazon.com distribution center and a big printing plant run by Quebecor among them but those operations have had to wait for buildings to be completed when they’ve chosen sites in Fernley.
Panattoni’s spec project, however, will have industrial space under construction or completed when companies come looking.
Six buildings are planned on the site, and Panattoni projects the property will fill within seven to 10 years.
While Fernley might feel distant to Reno and Sparks residents, Quintel said the distance is nothing to a distribution company whose eyes are on the entire West Coast.
In fact, the town is closer to preferred trucking routes to some parts of Southern California than Reno and Sparks, said Paul Perkins of Alliance Commercial Real Estate, which will market the Fernley project.
Panattoni also believes the project to be known as Pacific Gateway Industrial Center also will benefit from the availability of workers nearby in Fernley. The distribution facilities will be between Interstate 80 and the Union Pacific Railroad tracks at the east edge of Fernley.
Wade Development will sell the land to Panattoni an unusual move because Reno-based Wade typically doesn’t turn to outside developers.
But Stan Thomas, vice president of sales and marketing for Wade, said the company has its hands full with projects ranging from highway and water infrastructure to residential and retail planning at its 5,000-acre Sonterra property at Fernley.
Wade executives have long working relationships with Panattoni and like the Sacramento-based developer’s national network of clients.
“That gives us another marketing arm,” Thomas said.
Even as it’s working to close the deal with Wade Development, Panattoni this week begins construction of a 429,000-square-foot speculative distribution building at its Lear Industrial Center in Stead.
Potential tenants have expressed interest in nearly half the building already.
It’s next door to a just-completed 200,000-square-foot building. Tenants in that building include BFS Diversified Products (56,550 square feet), Wacker Corp. (56,550 square feet), Perfection Clutch (50,750 square feet) and Metro Medical Supply (36,250 square feet.)
Three of four tenants, Quintel noted, are new to the region; only Perfection Clutch was here previously. Much of the recent demand for industrial space, he said, has been driven by Eastern companies who want West Coast distribution but don’t want to be in California.
Once the new 429,000-square-foot building is completed, Panattoni has room for only one more big-box distribution facility on the Stead property.
And that, Quintel said, got the company looking farther afield for the developments to fuel its future in northern Nevada.
Since launching its new pediatric products two years ago, Neo Medical has seen a 35% growth in sales; moreover, the company has seen revenue grow 15% year-over-year since relocating to Sparks in late 2012.