FEATURE ARTICLE, DECEMBER 2005

VENTURING FORTH INTO HIGH-GROWTH WEST
Venture Development Group brings breadth of experience and unwavering commitment to retail sector.

A Las Vegas retail broker joins forces with a Californian versed in commercial development/construction as well as real estate investment. The results have been impressive with the future even brighter.

Three years ago, Matt Bear and Chris Lattanzio came together to form the real estate development company called Venture Development Group. The two set up shop in Las Vegas but have focused more on other markets like Phoenix; Reno, Nevada; Denver; Boise, Idaho; and parts of the Central Valley in California.

Follow the Opportunity

“Phoenix is our focus,” says Bear. “Phoenix is really where we spend most of our time. Pricing has escalated like everywhere else in the country, but you can still find opportunity there. It's probably going to go from 3.5 million to 8 million people over the next 20 years. Whenever you can talk about basically building a second L.A., you know it's something that it is important to spend time in.”

Bear says that while Las Vegas has been relatively insulated from major economic cycles, Phoenix has had its ups and downs. However, the amazing growth has brought balance to Arizona's biggest metropolis.

“I think that Phoenix has finally gotten to the point where there's a critical mass of corporate headquarters or secondary headquarters or research, etc.,” says Bear. “There's enough diversification in the corporate base that that market may slow down, but I don't think there's a crash in the Phoenix future.”

On the Retail Scene & In Between

Venture Development Group's work is 99 percent retail, ranging from 10,000-square-foot, single-tenant build-to-suits to 150,000-square-foot projects. The company currently has 22 projects underway with a goal of building 1 million square feet of retail a year.

“Because we're a relatively new company we've had to focus on opportunities that the larger institutional-quality companies weren't focusing on,” says Bear. “That means a parcel across from a power center, hard corner or surplus real estate from retailers. Generally, you still go by the fundamentals, but instead of being the grocery center, you're across from the grocery center. To date most of our properties have been under 5 acres.”

At this point, Venture Development Group builds projects and then sells them to investors. However, Bear says that, in the long term when cap rates rebound, the goal is to grow a portfolio of properties.

The former retail broker says that infill projects are always attractive because tenants can be assured the day they open their doors that they're going to have business. However, a company can't ignore the high-growth areas. In the Phoenix area, Bear points to the northern and western submarkets of Avondale, Buckeye and Surprise as the ones experiencing heavy growth.

A Model Model

A big part of Venture's success is sticking to what it knows how to do — retail and relationships. This comes from Bear and Lattanzio having been in the industry long enough and having seen it from every conceivable angle. “I think what makes retail real estate so fun and exciting to us is that it really is a relationship-driven business,” says Bear. “You really have to go to that extra level. If you do business well, everybody gets what they want — the tenant gets a great shopping center, the investors get a great return and we get a great project. If we can't figure out that win-win-win proposition, we're just not going to do it.”

“You drive markets, you get good real estate, you have a good relationship with the brokers, you know all the tenants and you match-make. What it boils down to is hard work, persistence and patience, and as simple as that sounds I think that's our advantage.”

— Brian A. Lee

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