The subject property is located in the North Las Vegas submarket, along the Cheyenne Technology Corridor. The Cheyenne Technology corridor was conceived as a partnership between the City of North Las Vegas and five developers. These developers created a variety of work space and attracted large technology oriented tenants such as Spacecraft Components, California Plasticard, Inc., Emory Riddle University, Federal Express, MedicWest Ambulance, Schwan’s Home Delivery, U. S. Foods, Wirtz Beverage Group and Cox Communications. In total, the area incorporated 5.2 million square feet of space and attracted 10,000 jobs to the area. Also in the area, the Department of Veterans Affairs (a tenant in the subject property) built a $600 million facility to provide veterans with skilled care and a community living center. In addition, a master planned community called Aliante is currently being developed and will include 1,165 residential units.
The subject property has seven primary competitors totaling 1.2 million square feet. Many of these competitive properties have been hampered by their high basis and contain 69% occupancy. The most competitive property is adjacent to the subject and owned by LBA. LBA acquired their property in 2006 at approximately $160 psf. With such a high basis, LBA has been reluctant to lower lease rates and make the necessary improvements. This gives BKM the opportunity to “poach” tenants (such as was the case of the subject’s current tenant Atlas) away from this competitor.