Mike Homa doesn’t believe in doing anything small and from the looks of it, neither does his employer, R&R Realty Group. In less than five years, the Des Moines-based commercial real estate company has announced the presence of its subsidiary arm, R&R Nebraska, with a foot in both the industrial/warehousing and office markets.
“Our first projects in development started with industrial,” said Homa, a former banker and now R&R Nebraska president. “We’ve built and leased over 800,000 square feet of industrial warehouse space in the last three years and have our fourth building, which will take us up to right at 1.1 million square feet, under construction right now. That development is down on the Highway 370 and Highway 50 corridor.
“The other area where we’ve been developing is office. We completed in June a 180,000-square-foot Class A office building. The development is called Fountain Ridge and it’s in the 192nd and Dodge area. And on Oct. 4, we broke ground on a medical office building that we are building and partnering with a medical group, MD West ONE. That’s on the west side of 192nd Street on 20 acres we own there.”
Addressing New Needs
Considering the challenges of the pandemic era — affecting everything from materials to labor — 20 acres is a pretty bold initial footprint. Homa said R&R Nebraska isn’t as interested in being just the biggest as it is being the commercial real estate agency of choice and builds its properties accordingly. This has helped it weather the recent market swings.
“When it comes to warehouse buildings, tenants want taller, clear heights,” he said. “We’re building buildings that have 32-foot clear heights and that allows warehouse users to come in and put in very tall racking from floor to almost ceiling.
“We’ve seen in some cases that with that type of structure, companies can reduce the amount of square footage they need because they can go vertical. They have these robotic picking machines that go up and down the aisles and go all the way up and get what they need.
“The other things that we’ve done and brought to the market is trying to get as much natural light into these warehouse buildings as possible with big entrance areas with glass and windows all along all the sides of building.
We’ve also really focused on making sure we allow for expansion parking for customers that need extra truck and vehicle parking space, and increased power capacities to the buildings.”
The company’s office building pays similar attention to detail. Homa said tenants and their employees expect more from office buildings, especially after getting a taste of remote work arrangements.
“People are really looking for what amenities are provided as part of an office building,” he said. “It’s a war for talent right now and if employers can have nice office space with amenities that employees can utilize throughout the building, they’re going to have a better chance of recruiting the type of talent that they want.
“What we’ve done is we’ve loaded our office building with amenities. There’s a Starbucks kiosk cafe. There’s a full fitness center with men’s and women’s locker rooms with showers, Peloton bikes, full array of cardio and weight equipment. We have a food court. We have excellent rooftop patio areas, conference rooms that are available for all the tenants of the building to use so that they don’t have to have so many conference rooms in their individual spaces.”
Strategy
Homa said while leasing takes all comers, the company was strategic in the placement of the building, putting it in close proximity to Methodist Women’s Hospital in the hopes of absorbing ancillary health care tenants. He’s also targeting tenants that need larger footprints such as call centers, and said location is a big selling point in that effort.
“For the Omaha market, we really felt like we wanted to have access visibility to the West Dodge corridor,” he said. “Everything in Omaha tends to go off the West Dodge spine if you will. Our philosophy, and it’s worked very well for us in Des Moines, is that we want to locate our office buildings where a lot of the owners of businesses — presidents, CEOs — are located. I’d say those are the two biggest reasons why we really liked this 192nd Street corridor.”
Homa said while the jury is still out on whether or not work-from-home will continue wholesale, there’s no question many companies are cutting back on their space as a result of pandemic-era changes. Still, he looks forward with optimism.
“In the conversations that I’ve been having, some companies say they need everybody back in the office. They perform better as a company when people have their heads together in the room and they’re focused on a project versus being on some kind of a Zoom call,” he said. “Engagement is big and company culture is big.”
