Fernley rebound: A prime location for residential, commercial development?
During the recession, Fernley was one of the hardest hit markets in Nevada, if not the entire country.
But Aaron West, CEO of the Nevada Builders Alliance and Andrew Haskin, director of business development for the Northern Nevada Development Authority (NNDA), stressed that the community of almost 20,000 people could be ripe for exponential economic growth. West and Haskin spoke to a large group of city officials and residents at a breakfast meeting at Wigwam Restaurant and Casino Aug. 3.
West indicated the influx of new residents to northern Nevada with the introduction of Tesla and subsequent development of Tahoe Reno Industrial Center. While Reno-Sparks has been an obvious beneficiary, it has created rising housing prices and a strain on supply.
Because of Fernley’s close proximity to TRIC, residents either priced out or shut out of the Reno-Sparks market could naturally gravitate east to Lyon County.
“Reno has a little more to offer so that’s typically where people start, but there comes a point they can’t afford it and they look elsewhere,” West said. “It’s a function of the price point. It has to get to a point where the floodgates open and we’ll see that activity.”
The medium new single-family home price in Fernley recently went up from $175,000 to $188,000 while Reno-Sparks on average can be around $300,000-$400,000.
West strongly encouraged developers in Fernley to invest in new home construction, although there has been an uptick in building not seen since pre-recession days.
In the fiscal year in 2015 there were 49 new homes built in Fernley as compared to 236 in 2006 and, astonishingly, just one in 2012.
He also put to rest concerns over the housing price bubble bursting again or over-supply of the Fernley market.
“I would remind everyone, that the bubble was really triggered by access to free money,” West said. “It used to be if you had a pulse you could get a loan. That’s not the case anymore. The demand we’re seeing right now is really driven by job growth.”
Rick Kabele, building official for the City of Fernley added that neighboring Storey County where TRIC resides, intends to invested heavily in commercial development rather than pouring money into residential development, further opening the door for Fernley.
West and Haskin also said commercial development could spill into Lyon County, as space in areas such as Reno’s North Valleys start to run out.
Haskin said NNDA has hosted at least a few large companies interested in relocating to northern Nevada recently.
Under non-disclosure agreements with companies, Haskin cannot reveal their intentions at this time nor tell companies where to relocate, but he did indicate several companies expressed interest in Lyon County in comparison to other sites.
“We’re seeing a lot of interest coming in the last three weeks,” Haskin said. “I’ve seen three new clients that we hadn’t met with before that are considering the five counties we represent,” Haskin said.
He also touched on the potential of the proposed Gateway Commercial Center project, a 2,000-acre development in Lyon and Churchill counties that should also boost commercial activity. Once completed, the park will boast an Intermodal Rail Center that will provide railway access for companies throughout northern Nevada, including Lyon County.
“We’ll see if that project starts to move forward,” Haskin said. “They’re also looking for companies who can provide shipping services not only new tenants to the park, but for companies that are (in Fernley).”
Haskin said NNDA is working closely with the park’s development bringing new business to the area.
“I think we’re busier than we’ve ever been and it’s an exciting time for everyone,” he said.