$6.9 million
In 2009, the penthouse unit at Turnberry Place 3801 was on the market for $16 million. One of the largest penthouse units in Las Vegas, the two-floor listing included five bedrooms, nine bathrooms, a wet bar, pool, billiard room and scenic view of the Las Vegas valley.
Then the recession hit. In 2011, the penthouse was traded to a new buyer for $8 million. Today, the unit is once again on the market, this time listed at $6.9 million.
Nicole Tomlinson, the director of real estate agency Shapiro and Sher’s high rise division, said the luxury real estate market was hit hard during the recession.
“It takes a unique buyer to buy a penthouse,” she said.
For many of Tomlinson’s clients, high rise units tend to be their second or third home, an unnecessary purchase that many opted out of during the recession.
PENTHOUSE
But that hasn’t stopped some investors from laying out plans.
Miro Development owner Kenny Lin, who wants to build Avante Lofts, knows he can’t charge big rents in Las Vegas. But apartment buildings have been filling up.
The valley’s apartment vacancy rate was just 3.3 percent in the first quarter, down from 8.9 percent in the same period in 2011, according to research firm Reis Inc.
“The demand’s there,” Lin said.
‘$100,000 question’
The Molasky Group of Cos. is developing high-rises in Portland and Seattle but none in Southern Nevada. President Rich Worthington said he “just wouldn’t feel comfortable” building a tower here.
The company owns 7,000 apartment units in the valley, with average rents at just over $1 per square foot. A tower would have to charge in the high $2 or low $3 range, Worthington said — prices that are largely out of reach for landlords in Las Vegas, where overall salaries are lower than in cities with high-rise construction.
The median household income in Clark County is around $52,000, compared to about $71,000 in Seattle and $81,000 in San Francisco, according to the U.S. Census Bureau.
Worthington figures the valley will get more towers, but not anytime soon.
“I think we’re going to get there,” he said, “but the $100,000 question is when.”
Apartment developer Jonathan Fore of Fore Property Co. doesn’t think the new projects will all get built. He also wouldn’t be surprised if would-be developers merely wanted to flip their site to other buyers, a not-uncommon tactic during the bubble years last decade.
He figures there’s enough demand to fill one or two new towers, but added, “I could be proven wrong.”
At least one thing seems certain: Construction won’t start anytime soon.
Lin expects to break ground on Avante Lofts in about a year. Thunderbird Lofts developer Ilan Gorodezki, whose Super 8 and Thunderbird motels occupy the project site, said in March that a groundbreaking could be a year away.
Midtown-downtown developer Kevin Plencner said his construction financing would be backed by the U.S. Department of Housing and Urban Development, and under its rules, he needs a contractor with HUD experience. He plans to break ground within six months of hiring the builder, he said.
Downtown 57 developer Daniel Riceberg, a Los Angeles-based broker and investor, wants government subsidies and figures he can’t build the project without them.
“It’ll be really tough, because then the rents have to go up,” he said.
Living small
One way to boost revenue is to have micro-units, or pint-sized apartments that let developers cram in more tenants. Avante’s units, for instance, would range from around 300 to 1,000 square feet, with most being on the smaller side, Lin said.
And one way to cut costs is to build a parking structure with fewer spaces than the tower’s total number of homes, in the hope that many renters won’t have a car.
Avante’s plans call for 295 homes and a 180-space parking structure, city documents show. Midtown-downtown has approvals for more than 300 parking spots, Plencner said, but not enough for everyone in the planned 458-unit complex.
In Las Vegas, with its sprawling suburbs and limited public transit, Lin knows that residents can’t easily live without a car. But he’s banking on a possible light-rail system, bike-sharing programs and ride-hailing services Uber and Lyft to help move people around and lure them to the city’s core.
The last high-rise residential complex to open in Las Vegas may have been Veer Towers on the Strip in 2010, Lin said.
The valley has a smattering of towers, but if the bubble years went as planned, they would be all over town.
With easy money everywhere, investors last decade laid out plans for dozens of condo towers and other high-rises as part of the “Manhattanization” of Las Vegas. Ultimately, most weren’t built, in some cases leaving giant holes in the ground that still remain.
At an April hearing for Avante Lofts, according to minutes of the meeting, Las Vegas Planning Commission Chairman Trinity Schlottman said that with more of these projects coming before the panel, he hoped “they were not just pipe dreams” and that “they would get built.”
Contact Eli Segall at esegall@ reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.