Developer makes waves in Truckee Meadows

A San Francisco development company made a major move into northern Nevada in recent weeks, buying a big piece of land at Tahoe Reno Industrial Center and a cornerstone retail property in downtown Reno.

And Union Property Capital Inc. is actively searching out more deals in the region.

The company's purchase of 108 acres at Tahoe Reno Industrial Center is the third-largest land purchase in the history of the industrial center along Interstate 80 east of Sparks.

Its acquisition of the old JC Penney location at 1st and Sierra in downtown Reno, meanwhile, gives it control of a key piece of the redeveloping central business district.

Terry Sternberg, managing director of Union Property Capital, said the company plans to build four distribution centers on the land it purchased at Tahoe Reno Industrial Center.

The first of the buildings is projected to be 500,000 square feet, although the developer might expand it to 800,000 if there's sufficient demand. Grading for that project is expected to be complete by the end of this month.

The four buildings, which all will be high-cube and cross-docked warehouses, are expected to total about 2.1 million square feet. They're developed as speculative projects, and Union Property doesn't yet have signed deals with tenants.

Union Property Capital was represented by Gordon Zack, an industrial broker with CB Richard Ellis in Reno, in its purchase of the land.

Sternberg said the company was drawn to Tahoe Reno Industrial Center because of its extensive industrial infrastructure everything from highway and rail transport to on-site electric generation as well as the belief that the center represents the future of industrial development in northern Nevada.

He noted that trucks from distribution companies at the center can reach 11 states in the West within 24 hours, and labor costs are lower than they are in California.

The land purchased by Union Property Capital is south of the Wal-Mart distribution center that opened this year and next to a 601,000-square-foot distribution center under development by ProLogis.

In downtown Reno, meanwhile, Union Property Capital looks to redevelop the 56,000-square-foot building at 100 N. Sierra St. into a multi-tenant retail property.

"We think the long-term trend for downtown is very strong," he said.

Sternberg said the company's principals have been watching the Reno market for several years, and stepped up their work in the region once several projects in San Francisco no longer required all their attention.

He said the company is looking for other investment opportunities in northern Nevada. The company looks for outright purchases, joint ventures with existing owners or long-term ground leases.

In the San Francisco area, Union Property Capital has about 500,000 square feet under development. It's working on winning approval for another 1 million squre feet of projects.

Union Property Capital was formed in 1989 by a group of veteran real estate developers. A related company, UPC Holdings LLC, provides property-management services.