West Henderson is recreating itself as an employment center featuring high wage employment, and welcoming new and relocating, expanding businesses.
In a few short years, the area has transformed into a center for industrial growth and development, leading the way as a site for advanced manufacturing and distribution facilities.
This is planned growth. West Henderson is taking advantage of its unique location combined with Nevada’s business friendly outlook: Zero corporate tax coupled with Henderson having the lowest tax rates in Southern Nevada.
That strategy is working.
“West Henderson is a unique spot,” said Derek Armstrong, director, Economic Development and Tourism, City of Henderson. “We’re located in a metropolitan area that’s within a day’s drive of Southern California, the Phoenix area and Utah. With the availability of land and the characteristics around it, companies looking for large plots of land to do large scale activities have opportunities in West Henderson they don’t have in many other places.”
“The whole area started about four and a half years ago, when a couple of land speculators struck a deal with the City of Henderson to purchase 153 acres,” said Dan Doherty, executive vice president, industrial division, Colliers International. The idea was to gather higher types of employment generators in one location, near what could be considered the entrance to the city at I-15.
The speculators met Doug Roberts, partner, Panattoni Development Company, to discuss the first new industrial project in the area. The 290,000-square-foot FedEx ground facility joined Levi Strauss, a 760,000-square-foot facility already in West Henderson since 1995.
That project kicked off West Henderson’s employment center. Today the city boasts the Starr Interchange, a new traffic-relieving interchange between Cactus Avenue and St. Rose Parkway. “That really opened up transportation and access for residents trying to get into West Henderson,” said Jim Stuart, partner, Matter Real Estate. “Traffic patterns get changed, infrastructure gets laid down, marquee tenants are coming to the neighborhood – everybody gets excited.”
West Henderson is also home to Henderson Executive Airport, and close to McCarran International for easy access in and out of the Las Vegas Valley to anywhere in the world.
Stuart credits the city’s progressive take on infrastructure, getting utilities and public streets prepared, as one of the trends bringing attention to West Henderson. “Then with marquee tenants coming in, like the Raiders headquarter facility, it brings even more attention to the area,” he said. Matter is building 500,000 feet of industrial product in West Henderson, spreading that square footage across seven buildings.
The companies committing to West Henderson are putting the area on the map, creating a momentum that attracts even more companies looking to build or lease new product. The plan calls for a little bit of everything, said Armstrong – industrial, office, retail and there is housing being built – but mostly the growth is centered around industrial sites.
“The reason for designating West Henderson as an employment center is because we have so many people who live in Henderson but work in the county, whether that’s Strip or around the Valley,” said Armstrong. “The focus of creating jobs in Henderson is so people have the ability to both live and work in Henderson.”
Of the three dozen commercial real estate projects building in West Henderson, they’re pretty much 100 percent industrial buildings, both speculative (spec) construction and built-to-suit, explained Roberts.
Build-to-suit projects that are already leased or sold before they’re completed are relatively common. However, for developers to be building industrial spec again after a long dry spell is an indicator of a healthy, growing economy.
“We knew West Henderson had big potential,” said Roberts. “We’ve been out here for about five or six years. What we found attractive is a good quality workforce, easy access to I-15 which takes you to southern California and, at the time, the land was relatively plentiful, there were quite a few parcels available for development.”
What’s driving the growth in Henderson isn’t any one thing; it’s a combination of factors that make the area work.
“Some of it is purely location,” said Roberts. “Because a lot of the time logistics can be relying on a legal turn. On any given day, something comes into the ports, say from the Inland Empire to Las Vegas. That trucker can make the trip from southern California to Las Vegas and back again, and that’s a legal turn. Some parts of the Valley aren’t able to do that, but the southern part of the Valley can, and that’s where Henderson is located.”
The farther into the Las Vegas Valley a company locates, the more likely it is a driver will hit his maximum time or mileage allowance and have to stop for the night. “So the farther south we can get industrial locations, the deeper we can go into California on a same day basis,” said Doherty. “That’s very compelling for logistics companies.”
Across I-15 from Henderson is the southwest industrial market. “Anything along I-15 on the south part of the Valley totals about 50 million square feet of industrial users,” said Doherty. The area is becoming congested with traffic servicing convention centers, resort hotels and other locations in the Valley. Add construction traffic around Raider Stadium and some groups are looking for a less congested area for operations.
Demand for industrial projects is also driven by pure need – the entire southern portion of the Las Vegas Valley is under supplied by industrial product. “In reality, anywhere you build in the south part of the Valley you’re going to do well because we’re just building a lot less than we used to build,” said Doherty. Though industrial product is built in North Las Vegas, the area doesn’t have the same proximity to California.
“Henderson is very pro-growth and development,” said Larry Monkarsh, partner, Brass Cap Development. “They’re also pro-business. The city is very accommodating. The Mayor has done a tremendous job of fostering a pro-growth mentality throughout the municipality.”
In part because of that pro-growth agenda, there’s a shortage Valley-wide of industrial buildings for lease or for sale. “So the product we’re building now is also for lease or sale, but we’re finding a very high percentage of interest in purchasing from end users, as well as from investors coming into the market,” said Monkarsh. Brass Cap Development is contributing to the inventory with two buildings at Executive Airport Drive and Dale Avenue, adding 70,000 square feet of industrial space to the market.
All residential communities in the south part of the Valley are growing significantly. “People are driving by the area to get to their place of business and realizing ‘I can cut my commute in half if I just move,’” said Doherty.
Companies moving to West Henderson are a mix of new companies from out of state and Nevada companies relocating or expanding. Some are both new and familiar – Smith’s grocery stores have been in the area, but the Kroger distribution facilities to serve those grocery stores is new. The mix is roughly 65 percent new entrants and 35 percent organic growth, said Doherty.
That percentage is shifting. “The existing Las Vegas companies that need to expand and relocate is growing because of this huge construction wave that we’re in the midst of in the Las Vegas Valley,” said Doherty. “There’s close to $16 billion we have under construction throughout the Valley, not including any industrial product. We’ve never seen a construction wave like that, not even in the prior peak.”
Diversity is the name of the game when enticing and welcoming new businesses. West Henderson is a good fit for companies that need to distribute in southern Nevada, want to service the Southwest or locations across the West, or companies like Amazon that already have a massive distribution network but find the southern Nevada population easily commands its own distribution network.
One of the biggest additions to the local economy is the Raider’s Headquarters and Training Facility. With 90,000 square feet of corporate offices, two indoor practice fields and one outdoor field, they’ve only built out one-third of their land.
The Raider’s facility is one of the marquee tenants taking up residence in West Henderson, and that’s a draw for other businesses to follow. Having the Raider’s headquarters in town is expected to be a significant economic impact on the area: the Raider’s are committed to opening the facility to the public as much as possible and to holding one of their summer training camps in Henderson.
The Vegas Golden Knights, a professional hockey team, is building a downtown practice facility that will feature two ice rinks open to public use. The new minor league team will include Henderson in its name and practice at the downtown rink.
Growing the Industries
Manufacturing is one of the key industries targeted by the Governor’s Office of Economic Development to expand. West Henderson is in the forefront of that effort.
“As a city, it’s important that we develop the area and target specific industries, and out here it’s primarily advanced manufacturing, which is one of our primary sectors,” said Armstrong.
So, it’s good news that Haas Automation is locating in the city to build a 2.4-million-square-foot factory. The company is one of the top five makers of computerized numerical controls in the world. Computerized numerical controls are a type of machine tool used in manufacturing virtually ever precision metal part in virtually every industry across the globe, according to Peter Zierhut, vice president, Outside Operations, Haas Automation.
“We ship all around the world, all across the United States, and Henderson is maybe a little better centralized than our site on the coast in California,” said Zierhut. From Henderson they can still reach ports in California, and can ship more easily across the U.S. Another draw was affordable housing, a luxury California can’t boast.
Haas will hire locally, bumping up the local economy, but it should provide an additional economic boost by bringing in more companies. Haas expects a number of its suppliers will follow to Nevada; one of the reasons it’s building an industrial complex beside its new factory.
Southern Nevada isn’t known for its manufacturing industry, so Haas is looking to create a manufacturing micro economy in the area. Haas plans to help build the necessary manufacturing infrastructure in the area, and they’re also working with educational institutions in order to focus on the pipelines of students needed to help grow the manufacturing workforce. Toward that end, they’ve met with College of Southern Nevada (CSN) and Clark County School District representatives.
The Educational Component
One of the Nevada System of Higher Education (NSHE) institutions working with companies coming into the state to help meet workforce needs is CSN, a fully accredited college, offering 70 academic programs. One of the school’s campuses is located in Henderson.
With all the economic development going on in West Henderson, CSN has been focusing on workforce readiness. The school’s Division of Workforce and Economic Development meets employer training needs in key industry sectors, working with employers to prepare existing workforce for economic development opportunities, whether that requires a specific course or a certificate program. The college works with Workforce Connections which in turn works with employers to understand their staffing needs, and with job seekers to provide training for opportunities.
“We are working directly with Haas Automation and with supporting the ecosystem of advanced manufacturing which is in such high demand in southern Nevada,” said Patricia Charlton, campus vice president and provost, Henderson campus, College of Southern Nevada.
CSN also works with the K-12 pipeline, offering high school juniors and seniors the chance to take college courses for credit either on the Henderson campus or through concurrent enrollment at their own high school.
There are jobs available for students when they graduate and for residents. The new Amazon distribution center is projected to employ a thousand people, said Armstrong. The Haas facility is a 2 million-square-foot advanced manufacturing center that’s going to employ 2,500 people at average wages of $60,000 annually.
That’s a great start for an employment center.
One side effect of rapid development is rapid absorption of land available for development. That’s happening in West Henderson, but that doesn’t mean there isn’t room for new companies. It just means things are being done differently than they were before all the growth started.
“There’s not much city-owned land at this point,” said Armstrong. “Most is privately held. That doesn’t make things impossible. Buyers just go through a different process to purchase the land from private owners.”
Meanwhile the city is working with the county to free up land for economic development. Most of the land they’re looking at is zoned for industrial or light industrial or semi-public use, said Armstrong.
The first businesses that headed into West Henderson were manufacturing and distribution.
“Now you’re seeing, with the increased job market out there, the change in how people access the residential neighborhoods and just simply the awareness of West Henderson, the excitement of the Raiders. That is bringing in, in a predictable way, the ancillary user, food and beverage, convenience items, lifestyle type operations will all end up there,” said Stuart. “Soon you’ll see medical, limited service hotels, business hotels, multi-family and supporting retail and food. In the end, it’s following a very predictable path of a suburb that’s growing up, albeit at a rapid pace. It will look like a city in a matter of three or four more years.”