EDAWN: Last year was strong, next year looks better
Fresh off a successful year of recruiting new employers and new jobs into the region, executives of the Economic Development Authority of Western Nevada said last week they expect the trend to build momentum.
Factors that range from skyrocketing industrial rents in the Silicon Valley to pent-up demand from companies that have delayed expansion plans for several years are likely to bring new employers to northern Nevada.
Mike Kazmierski, president and chief executive officer of EDAWN, says the economic development agency is returning to the basics as it woos new employers.
“Be out there, knock on doors, visit with companies,” he says in summarizing EDAWN’s approach.
It paid benefits in the fiscal year that ended June 30.
EDAWN assisted 16 companies that created 875 jobs during the 12-month period.
Among the largest of the new employers are Project Fusion, which is creating 180 jobs in a customer contact center in downtown Reno; online children’s retailer Zulily, which is employing 150 at a fulfillment center at Tahoe-Reno Industrial Center; and Replico Corp., a supply-chain and production outsourcing company that will employ 150 at a Stead-area distribution center.
The 16 companies assisted by EDAWN in its most recent fiscal year have estimated that their employment in the region will grow to 1,591 within five years.
The companies pay wages that average $19.20 an hour, will occupy approximately 1.1 million square feet of office and industrial space, and expect to invest $39.7 million in the region.
During the next five years, EDAWN estimates that the companies’ economic impact on the region will total about $926 million.
The year’s figures did not include Apple’s plans for a data center and support operations in Reno, nor did they include NJVC’s announcement of a new data center in South Meadows.
Sectors that account for a growing portion of the potential new employment in the Reno-Sparks area include advanced logistics, advanced manufacturing and back-office support functions that range from data center to customer-contact operations.
Stan Thomas, EDAWN’s vice president for business development, said the organization currently is working with top-priority projects that could bring more than 1,900 jobs to the region.
Manufacturing companies account for 46 percent of those prospects, logistics companies account for 31 percent and back-office operations account for 14 percent.
On the other hand, the number of clean-energy companies looking at the region is declining. That’s a reflection of struggles in the clean-energy industry as it faces the possible end of federal tax credits as well as competition from low-priced natural gas, Thomas said.
California companies continue to make up the lion’s share 60 percent of the companies that considering relocation to the Reno-Sparks area.
That reflects both the good news and the bad news in the California economy, Thomas said.
As technology companies are growing quickly in the Silicon Valley, the demand for industrial space is pushing up rents. Some suppliers to the industry need to find less-expensive space that’s still within reach of their Bay Area customers a description that fits the Reno-Sparks area.
At the same time, Thomas said continued concerns among California executives about the tax and regulatory burdens they face in the Golden State gets them thinking about relocation.
It’s important, Kazmierski said, that Reno and Sparks are part of their thinking about potential sites for relocation.
And to overcome outdated and mistaken perceptions among executives about the Reno-Sparks area, EDAWN is working hard to get executives from California and elsewhere to northern Nevada as quickly as possible after they express interest in the region.
“We just want them to look at us,” said the EDAWN president, who said that the agency closed deals with 80 percent of the companies that sent executives for a visit to the region in the past year.
Even better, Kazmierski said, are decisions by companies to move their headquarters not just some operations to Reno.
EDAWN landed a few of those deals last year, including Thermo-Stone USA Inc., which is bringing its headquarters and 15 jobs to Reno from California.
Headquarters operations bring cadres of senior executives to the region, further strengthening its business infrastructure, Kazmierski said.
“Unfortunately, once developers show up, history disappears and that’s what’s happening to Harrah’s Reno. Like the historic 1875 Adele’s building in Carson City, Bill Harrah’s crown jewel will disappear into the dustbin of history.”