In a recent interview on Nevada Newsmakers, Par Tolles, CEO of Tolles Development in Reno, shared his insights on the current state of the development and real estate industries. According to Tolles, things are moving slowly at the moment, and while many attribute this to the upcoming election, he believes that other factors are playing a more significant role.
One of the key factors Tolles pointed out is the recent cut in interest rates by the Federal Reserve. The Federal Funds Rate was reduced to a range of 4.75 percent to 5 percent from 5.25 percent to 5.5 percent, marking the first rate cut since 2020. With the possibility of two more cuts before the end of the year, businesses are hesitant to take on debt for growth, leading to a sense of economic waiting.
While some may attribute the slowdown to the election, Tolles questioned the historical impact of elections on the real estate market. He noted that over the past 20 years, there have been no significant changes in real estate due to an election year. However, certain businesses may be affected by election outcomes, especially if there are legislative changes that could impact their sector.
Despite the overall slowdown in the industry, Tolles Development has been making significant progress on multiple projects. One such project is the Hyatt Place South Reno, a 132-room hotel located near the Summit Mall on the Mt. Rose Highway. With its strategic location close to Carson City and Lake Tahoe, the hotel is expected to attract both business and recreational travelers.
Another notable project by Tolles Development is the Airways Commerce Center, a 900,000-square-foot employment hub offering space for offices, warehousing distribution, light manufacturing, and showrooms. Located near the airport, the center is well-positioned for logistics and overnight operations, with about 20 percent of the space already leased.
University Crossing, a recently completed 8,000 square-foot building in downtown Reno, is another project by Tolles Development. The building has been leased to four restaurants to cater to the growing student market as the University of Nevada expands into the downtown area.
One of Tolles‘ most significant projects is the construction of a 1.9 million-square-foot warehouse and distribution center near Jean, a small town on the Nevada-California border. With its strategic location and built-in infrastructure, the center is expected to become a key hub for shipping, receiving, manufacturing, and storing products and cargo of all kinds.
Overall, Tolles remains optimistic about the future of the real estate and development industries, emphasizing the importance of diversification and strategic planning in navigating the current economic landscape. As businesses continue to adapt to changing market conditions, Tolles Development is poised to play a key role in shaping the future of the industry.