hile many American communities crave the kind of attention that Las Vegas generates, the Sin City suburb of Henderson flies beneath the radar screen of corporate site selectors.
   But you wouldn't know it from talking to the town's leaders and private industry honchos. Once a predominantly bedroom community for Nevada's largest city, the Clark County boomtown now collects companies like nickels rolling into slot machines on free buffet night at the casino.
   "There is a multitude of different industries that have just taken off here," says Bob Cooper, director of economic development for the city of Henderson, a town that has swelled to 350,000 people. "Henderson will continue to grow rapidly. A lot of banking and financial institutions have moved here. Ford Motor Co. is putting 100 jobs into a loan processing center here. Three brand new hospitals have opened, as well as a new cancer center and research center. The companies are coming in from Phoenix, Salt Lake City, California and elsewhere."
   One of the biggest moves recently was Poly West, a Texas-based plastics manufacturer that opened production lines in 2006 in Henderson and has since increased capacity substantially. Today, the plant approaches 400 employees and 400,000 sq. ft. (37,160 sq. m.).
   Companies like Poly West flock to Henderson even though Cooper and his staff do very little to spread the word externally about what the city has to offer.
   "We are so grounded with being busy every single day and trying to make this community look outstanding," Cooper says. "It is not necessarily our goal to make sure that every site selector knows about Henderson. Our city manager says the intelligent people have already researched us, so it's OK that we aren't that well known. Until we have difficulty recruiting people, we don't have to worry about that."    Poly West is one of dozens of industrial firms to open shop in Henderson over the past 24 months. The ranks of those companies increase by the month.
   Cashman Equipment Co. broke ground July 12 on a 295,000-sq.-ft. (27,405-sq.-m.) corporate headquarters in Henderson, where the firm will employ 450 workers.
   "We chose the site in Henderson because of the geographic location," says Kate Graziano, spokesperson for Cashman. "The size of the property and the zoning there accommodated our plans very well. The site is also close to public transportation routes, an important consideration in light of our commitment to sustainability."
   The US$65-million plant will open in late 2008. The seven-building campus will be Gold LEED certified by the U.S. Green Building Council, according to the firm. The complex will use a geothermal, energy-savings system to heat and cool all structures.
   Cashman relocated from North Las Vegas when it purchased the property on Rose Parkway in Henderson for $28.6 million.
   "Henderson is expanding south down Interstate 15 toward the California border," notes Cooper. "There don't appear to be any physical constraints to our growth. Our tax system is so much better than California's. We are Delaware west. We have no unitary tax, no inventory tax, no personal income tax and no corporate income tax. Smaller manufacturers can jump across the border from California and operate here much less expensively and still service the entire Southern California market."
   The rapid rise of Henderson is remarkable, considering that in 1980 less than 30,000 people lived there. Today, it is Nevada's second largest city, having passed Reno, and by 2025 nearly a half million people are expected to call Henderson home.
   If it were based in California, Henderson would be that state's 14th most populous city, larger than Irvine, Glendale and San Bernardino.    But Henderson's climb to bigness and prosperity is not an anomaly in the desert region. Far from it, the American Southwest – including Nevada, Arizona, New Mexico and Southern California – is now the fastest growing population center in the U.S., as well as the country's fastest growing economy.
   The numbers from the U.S. Census Bureau and other agencies don't lie:
   • From July 2005 to July 2006, Arizona and Nevada were the two fastest growing states in the nation, increasing in population by 3.58 percent and 3.45 percent, respectively.
   • From 2000 to 2006, five of the 10 fastest growing cities in America were located in the Desert Southwest: Gilbert and Chandler, Ariz.; Henderson and North Las Vegas, Nev.; and Irvine, Calif.
   • The four fastest growing suburbs between 2000 and 2006, and seven of the top 12, were based in either Arizona or California. The top four were Lincoln, Calif., followed by three in Arizona: Buckeye, Surprise and Goodyear – all suburbs of Phoenix.
   • Maricopa County, Ariz., gained 696,000 residents between 2000 and 2006, the largest numerical increase of the nation's 3,141 counties. The rest of the top five were Harris County, Texas; Riverside, Calif.; Los Angeles; and Clark County, Nev.
   • Household income grew the fastest in Nevada and New Mexico, which both registered 4.5-percent increases last year. New Mexico's economy has been bolstered by record low unemployment, down to 3.2 percent this past summer.
   • Real gross domestic product accelerated the fastest from 2005 to 2006 in the West. The top 10 in GDP growth were all based in three western regions – Rocky Mountain, the Southwest and the Far West. Arizona was third and New Mexico fifth, each growing its economy by more than 6 percent.
   • Bill Fruth, an economist who annually produces a report measuring the economic strength of all American metros, reported that Las Vegas had the third best economy in 2007 and Phoenix was No. 7. Riverside-San Bernardino-Ontario ranked 15th. Reno-Sparks came in at No. 24.
   • The Milken Institute reported Sept. 26 that Riverside-San Bernardino-Ontario, Calif., had the third best performing economy in the nation this year, followed by Phoenix at No. 4. Las Vegas rose from 11th to ninth.    Companies and site selection consultants are paying attention to this western ascent. Corporate executives responding to a Site Selection survey on state business climates (see cover story on Page 879) said that Nevada has the eighth best business climate in America. Arizona ranked 13th and California 17th.
   Deron Webb, managing principal of site consulting firm Wentworth Webb and Postal LLC in Phoenix, tells Site Selection that a variety of factors makes the Southwest attractive to expanding companies. He should know. His firm has handled site selection for U.S. Bank, Wells Fargo Home Mortgage, Washington Mutual, Frontier Airlines, La Quinta, Sears, Assurant, Allstate Insurance and Express Scripts, among others.
   "Generally, it's the attraction of the West, cheaper land prices, the opportunity to establish a hub," Webb says. "There are tax benefits in Nevada and reservation benefits in New Mexico. The quality of life here is often overlooked, but the quality of life we have in the Southwest is very good. You can play a round of golf here in the middle of January. People come here for corporate meetings and they find out it is a very desirable place to be."
   Webb also cites labor and costs. "The West has a very good work force that is well educated," he says. "People are moving west for a new opportunity. Arizona and New Mexico both ranked very favorably in cost of living in the first quarter of 2007 relative to the U.S. average, and so did Nevada."
   Webb's firm has been successful in relocating headquarters, regional branch operations and call centers to Arizona.
   "Quality of life is driving executive decisions," he notes. "If senior management wants to go to a certain location, they will probably go there. It goes back to weather and the secure operating environment. Arizona is ranked No. 2 by insurance companies in having the lowest weather risk. Tax incentives help too, and Arizona offers one of the strongest university and community college systems in the country."
   ICT, for example, located a 45,000-sq.-ft. (4,180-sq.-m.) call center in Nogales, Ariz., employing 450 workers.
   Webb says the state's bilingual work force is a huge drawing card for customer contact centers that must service clients in multiple states and countries.    Aerospace firms like Arizona too. Embraer and Dukes Aerospace both announced facility expansions in Greater Phoenix this year. Embraer broke ground July 2 on an $8-million executive jet service center in Mesa, while Dukes announced a 50,000-sq.-ft. (4,645-sq.-m.) assembly plant at Falcon Field in Mesa earlier back in February.
   "General business climate issues prompted our decision to locate here," says Bill Greer, vice president of business development for Dukes. "We can hire a trained work force at a reasonable price here in the Phoenix market. The cost of housing and cost of living are very attractive here."
   Dukes also favors a regulatory climate that is "much simpler" in Arizona, says Greer, whose firm is based in Northridge, Calif.
   Other industrial space users like expanding Western markets too. Mexican building materials company Cemex plans to build a $400-million cement factory near Seligman, Ariz. About 130 people will work on the 7,500-acre (3,037-hectare) site upon the plant's completion in 2012.
   Enel North America Inc. announced a $202-million investment two geothermal energy facilities in Churchill County, Nev., east of Reno. More than 400 construction jobs and 25 permanent jobs will be created by the renewable electricity generation company. The Salt Wells project is the first new geothermal power plant to be built in Nevada since 1993.
   Pat Cavanagh, senior vice president and manager of the West Region for Prologis, says his company, a Denver-based global developer of distribution facilities, is bullish on the Southwest.
   "Our location decisions are based on what we perceive to be consumer product needs, which drive our business," Cavanagh says. The company's largest tenants in the Southwest include Anixter, Bunzl Distribution, DHL, Home Depot, Kraft Foods, Mohawk Industries, NYK Group, Unilever and Wal-Mart.
   As of June 30, Prologis owned a portfolio of industrial real estate that included 58 million sq. ft. (5.4 million sq. m.) in California (nearly 70 percent of it in Southern California), 23.2 million sq. ft. (2.2 million sq. m.) in Nevada and 3.5 million sq. ft. (325,000 sq. m.) in Arizona.
   Out of a worldwide distribution portfolio of 447 million sq. ft. (41.5 million sq. m.), the firm's domestic portfolio covers more than 321 million sq. ft. (29.8 million sq. m.).
   On July 12, Prologis acquired a 24.7-million-sq.-ft. (2.3-million-sq.-m.) portfolio of industrial real estate from Dermody Properties for $1.85 billion. Assets include distribution space in Reno, Las Vegas and Tejon Ranch in California.    "We like the Southwest region because it is the gateway to Asia. I can't emphasize that enough," says Cavanagh. "That is a driver of the entire Southwestern economy. Most of the goods that come into the U.S. from Asia are consumer goods that go into a train or warehouse. When we see the activities going on in Southern California and Seattle and Portland, a lot of that is driven by our proximity to Asia. The Port of Long Beach is the largest port in the U.S. by a considerable margin. It is the only port with the infrastructure to handle the volume. Some 18 million people live there."
   The combined ports of Long Beach and Los Angeles, at 15.76 million TEUs in 2006, rank among the five largest in the world in cargo volume. Combined, the next five largest ports in the U.S. do not equal the total volume of Long Beach and Los Angeles, which is growing at 20 percent a year for the last three years.
   In the CMSA of Greater Los Angeles, there is more than 1.5 billion sq. ft. (140 million sq. m.) of industrial space.
   Cavanagh notes that growth in Southern California is now pushing out eastward faster than at any time in history. "Most of the large distribution centers that have located in Southern California have made the Inland Empire their first choice," he says. "The entire industrial base of this region is centered in Ontario. From there, you form a 30-mile [48-km.] ring down to the Interstate 215 corridor and out to Redlands and Moreno Valley. Further out, Victorville and Beaumont are fluid and expanding."
   Cavanagh advises corporate real estate decision-makers to locate their facilities as close as possible to their customer base in the Southwest.
   "On a long-term basis, fuel prices will continue to rise, traffic will continue to get worse, and the population will grow. Sensitivity to these issues must increase," he says.