Tradewinds Construction Examines the Post-Recession Commercial Real Estate Recovery in Las Vegas
An old adage says that it’s always darkest before the dawn. This proverb contains some sage wisdom, as it’s often true that things may have to hit rock bottom before once again ascending. This is often true in the construction world as boom times often follow busts, and the boom times can then lead to another bust in the future. The commercial real estate market in Las Vegas suffered a bust of epic proportions in 2008 as The Great Recession hit, causing real estate values to plummet. This was in large part due to two decades of nearly nonstop expansion, which then coupled with the availability of “easy money” for speculative real estate developments in nearly every category of real estate. This then created the overbuilding of nearly every sector of both commercial and residential real estate in the Las Vegas area.
When the “epic” bust occurred, construction activity in Las Vegas nearly ceased, and many construction firms were forced to close their doors. However, Tradewinds Construction devised a plan to weather the years-long storm with its core competencies in place and has now hit the ground running as the post-recession commercial real estate recovery continues in Las Vegas.
After almost four years of severe construction inactivity in Southern Nevada, the commercial real estate market in the Las Vegas area began to experience some activity in 2012. Since that time, there has been a small, but steady, increase in commercial real estate development as businesses are once again returning to the region or are looking to expand their existing operations. Tradewinds Construction has seen a marked increase in revenue during this time as new projects are envisioned, financed, and constructed. 2016 is already looking like a much better year due to the healthy number of secured projects already in hand, and the promise of more to come as the year continues to unfold. There are a number of reasons why Tradewinds Construction is poised to take advantage of this post-recession recovery in Las Vegas. The primary reason is that the company has retained the experienced personnel necessary to staff and complete a diverse array of projects that many other specialty contractors are not able to take on in the new environment of worker shortages nearly across the board. Tradewinds Construction’s decision to stay overstaffed during the recession is now paying off as the company can now put the expertise of their highly skilled workforce, which they knew they could not afford to lose, to work in the commercial real estate recovery that is now underway.
Another reason why Tradewinds Construction is positioned to take full advantage of the post-recession commercial real estate recovery is their sterling reputation for getting the job done, on time, for very competitive prices and in a very safe manner. Tradewinds’ never-ending commitment to its culture of safety has allowed the company to recently enjoy improving rates for workers compensation insurance. Lowering workers compensation rates with an exemplary culture of safety increases competitiveness in the marketplace and drops more profit to the bottom line. With the increase of commercial construction activity, the old adage of 80% of the work is done by 20% of the people seems to be holding true, and Tradewinds Construction continues to maintain its position as a market leader and is enjoying a healthy backlog of work for 2016 as investors and businesses are once again investing heavily into the Las Vegas market. This upswing in the construction market can be seen in, on, and around the streets of Las Vegas, Henderson, and North Las Vegas as construction is underway on nearly every real estate product type, including many disciplines of commercial real estate; a multitude of new, very large multifamily projects; and a healthy level of new single family housing. This includes many of the new big-big-box distribution buildings that are now being built. These e-commerce buildings are a new product in this market and are the largest distribution buildings ever constructed in the Las Vegas area. A number of experienced developers are building these properties on spec, beginning construction before having signed leases. However, the developers know that if they build it, the businesses will come.
One notable fuel for this burst in activity is the rise of e-commerce. Businesses that specialize in e-commerce are looking for affordable locations that feature low taxes and access to major transportation hubs. The Las Vegas valley fits their needs very well. Most of the new era of distribution and smaller multi-tenant buildings now being constructed in the Las Vegas area utilize panelized roof structures in their design, and Tradewinds Construction, one of Southern Nevada’s premier panelized roof structure experts, is once again enjoying a steady stream of panelized roof structure projects. These and other large projects, such as the new T-Mobile arena, the upcoming Faraday Futures automobile plant, the changes necessary to our health system brought on by the ACA, and the birth of Nevada’s new medical marijuana industry, are not only creating many new large projects but are having the halo effect of spawning many smaller construction projects springing up to service these new major additions to the Las Vegas economy. All of which help contribute to lifting the commercial real estate market to a higher level. After years of a seemingly limitless supply of foreclosed commercial buildings available for occupancy, there is now demand for new multi-tenant buildings, and contractors are also enjoying a good deal of new medical and hospital construction. The post-recession commercial real estate recovery in Las Vegas has been marked with a steady growth over the last few years, and while you never know what’s in store on the world stage, the current level of growth has been moderate and seems sustainable into the future. Currently, a number of large projects are in the planning stages for Southern Nevada’s future. The Las Vegas strip is poised for major new billion dollar resort developments from Wynn Resorts, the Genting Group, and Alon Las Vegas. Even on the outskirts of Las Vegas, outside of Pahrump, the Spring Mountain Motor Resort & Country Club will be undergoing a $200 million expansion over the next two years. This project will expand the resort’s race track and add commercial developments, including a movie theater and hotel. And, just recently, the National Hockey League awarded Las Vegas its next expansion franchise, which will be housed in the new T-Mobile arena on the famed Las Vegas Strip. Additionally, and perhaps most exciting of all, the potential seems strong that the Oakland Raiders may very well become the Las Vegas Raiders in the near future.
The entire commercial building industry is enjoying the benefits of this slow and steady economic increase of this post-recession era. Brokers, agents, property managers, general contractors, subcontractors, and more are quite happy with the current healthy and seemingly sustainable level of business. This recovery shows no signs of ending as more money is being funneled into development and construction deals, which is further increasing the velocity of activity. Overall, there is plenty of work in the pipeline, and Tradewinds Construction is taking full advantage of this post-recession recovery. Many businesses are looking to Tradewinds Construction at this time as they are one of the few firms with the expertise, manpower, and reputation for getting the job done right that few others can match. The future looks good as the commercial real estate market looks solid, staying on a steady course of improvement month after month. Tradewinds Construction has truly hit the ground running during this post-recession recovery, and they don’t plan on stopping any time soon.