A Reno developer is looking to hit the jackpot in Las Vegas by turning a shuttered casino site just south of the city into an industrial park to serve the distribution and light-manufacturing industries.
Tolles Development Co. plans to build a nearly 150-acre park in Jean, Nev., about 20 miles south of Las Vegas and 15 miles north of the California border.
The site—adjacent to Interstate 15—promises a quicker turnaround for truckers bringing in goods from Southern California.
“This is a real strategic location,” says Cory Hunt, chief strategy officer for Tolles Development. "Trucks can do a one-day round trip from the Port of Long Beach to Jean and back."
Hunt says the Jean location can shave two hours off the round trip between California and Southern Nevada because it spares truckers from having to navigate I-15 through the resort corridor to reach existing industrial space at the north end of the Las Vegas Valley.
He credits the company’s fresh eyes in recognizing the potential in Jean, which had been a casino town for 75 years.
“As a bit of a new entrant into the market, we saw the opportunity in Jean, where traditionally it might have been seen as too far out of town,” says Hunt, whose company does work at the Tahoe Reno Industrial Center. It also has found success in Northern Nevada even though it is located outside the Reno metro area.
Tolles Development paid $44.7 million for the Jean property, which includes the casino complex and its utility connections, and surrounding raw land. Hunt says the company will invest “substantially more than that” in a three-to-five-year phased buildout once construction begins next year.
That will include razing the hotel-casino, which has been closed since the start of the pandemic, to make way for expected distribution centers and light industrial tenants.
Hunt says the existing interchange, which served the 1,100 hotel rooms and two casinos that Jean once had, should be sufficient to handle traffic to the park.
He declined to name any contractors involved in the project or what it will be called.
The development taps into one of the fastest-growing sectors of the Southern Nevada economy, according to Andrew Woods, who heads UNLV’s Center for Business and Economic Research. He says, “Trade, transportation and utilities,” which includes logistics, was the first job sector in Southern Nevada to return to pre-pandemic employment levels.
Woods says the Tolles project “hit the nail on the head by seeing the potential in that property,” particularly with a possible shortage of developable land.
Woods cited a 2021 RCG Economics study for NAIOP that warns of a looming 5,000-acre deficit of industrial land in Southern Nevada, where much of the land is controlled by the federal government.
He also says the frayed supply chain caused by the pandemic has generated “a lot of talk of more on-shoring—‘just-in-case’ instead of ‘just-in-time.’”
That thinking has already impacted Las Vegas, where a veteran commercial real estate executive says she has “never seen an industrial market more vibrant, more dynamic,” one with vacancy rates below 2%.
“Product that is under construction is 50% pre-leased,” says Donna Alderson, executive managing director at Cushman & Wakefield, where she focuses on industrial properties. “We are chasing our tails to keep up with demand.”