Inviting, evolving Vegas

Makeovers, expansions and new buildings define the ever-changing (for the ritzier) Las Vegas.
By Bill Ordine

The main tower in the CityCenter casino-hotel as rendered by a computer. The Mirage is hoping to foster a neighborhood feel among its 7 buildings.

The Stardust, after 48 years on the Las Vegas Strip, is gone. The Venetian, opened in 1999, is about to double in size. And the casino formerly known as the Aladdin, just seven years old, is putting the finishing touches on a massive makeover as Planet Hollywood.

Las Vegas, always in transition, is at it again and, as usual, making itself bigger, taller, ritzier and, according to some, more urbane. The difference this time is that some of the buildings are being designed not merely to shout for attention but to actually complement each other.

The Venetian, for example, will be joined late this year by the Palazzo, a $1.8 billion expansion with a 50-story, all-suites tower and an enormous casino. The complex will have more than 7,000 rooms, and company officials say it will be the largest hotel-convention complex anywhere.

Even more ambitious is CityCenter, a $7 billion, seven-building complex that's already rising from the desert but is still more than two years from opening. Casino giant MGM Mirage is trying to create a 21st-century urban environment, albeit an extremely expensive one. The cheapest studio condos will be in the $500,000 range, but many units will be in the millions.

"By bringing great architects to Las Vegas, we are developing a much more global view of how people will live and be entertained 30, 40 years from now, rather than what's hot right now," MGM Mirage spokesman Alan Feldman says.

What's hot right now must be working, though, because the Strip continues to lure more visitors each year - now nearly 39 million annually.

Here are some of the major projects underway, with projected completion dates:

Planet Hollywood

September

The makeover of one of Vegas' biggest casino flops - the Aladdin, which opened in 2000 at a cost of $1.4 billion - is nearing completion, and the property is scheduled for a grand opening in late September.

Officially christened Planet Hollywood last month, the re-made casino will try to reverse the fortunes of a location that's become the Strip's Bermuda Triangle; two versions of the Aladdin have fared poorly there.

The casino's exterior, originally a fanciful turn on an Arabian Nights castle, has been resurfaced to a cream-colored sleekness. Inside, the giant genie's lamp is mercifully gone, and the decor is redone in geometrics.

The resort still figures to be an upper mid-market player in its pricing, with remodeled rooms inspired by Hollywood movies and familiar eateries such as P.F. Chang's and Alfredo of Rome.

A connected shopping mall will also get a contemporary look as it is renamed from the Desert Passage to the Miracle Mile. And a 50-story tower of residences and timeshares is under construction next to the casino-hotel.

Palazzo

Late 2007

The Venetian, one of the better renditions of a themed casino-hotel, is getting an addition that will be both separate from and joined to the original property.

The expansion will have its own name - the Palazzo - its own tower of suites, and its own casino, covering about 100,000 square feet. But it will not sport the faux Italian Renaissance style that distinguishes the Venetian. Instead, the motif is advertised as featuring Italian accents with Asian influences.

The Palazzo's signature feature will be a 60-foot, glass-domed lobby with a towering fountain, and it will connect to the Venetian through an octagonal passage that will also have a glass dome. The two hotels will have about 30 restaurants.

The Venetian's swimming pool area and the shopping mall, the Canal Shoppes, will connect to pools and shops at the Palazzo. The new retail area will add about 60 stores, highlighted by New York apparel high-ender Barney's, raising the total to 140 retailers. A 270-unit condo tower is planned to rise above Barney's.

The ultra-luxurious Canyon Ranch spa will also get bigger. Because of limited land, the Palazzo's parking garage was built underground, a rarity in Las Vegas.

Trump International

February 2008

Donald Trump's condo-hotel tower, west of the fading New Frontier gambling hall on the north end of the Strip, differs from other high-profile projects in that it will not have a casino.

But at 64 stories, and with Trump's name emblazoned across the top (much as rival Steve Wynn's signature decorates his own luxury casino across the street), the golden high-end high-rise will be prominent on the new Vegas skyline.

While many condo projects have fizzled - count actor George Clooney and Trump's ex-wife, Ivana, as frustrated developers - the Trump project sold briskly, and a twin tower is expected to start going up as soon as the first is finished.

Owners can rent their condo hotel units when they're not using them. The 1,282 units in the first tower were priced from $550,000 to $6 million (most are studios), with the ante going up for the second. Amenities will include a restaurant and a swimming pool.

Encore

Early 2009

Wynn was planning an expansion of his 50-story, curved, bronze-colored resort even before he opened the doors in 2005.

Budgeted at $2.1 billion, the new hotel tower, Encore, will have more than 2,000 rooms, from executive suites to duplex sky villas and penthouses. There will be a 72,000-square-foot casino, additional restaurants, nightclubs, swimming pools, and retail stores.

CityCenter

Late 2009

One of the most ambitious entertainment and residential projects ever undertaken, CityCenter is likely to influence development in Las Vegas.

Historically, the Strip's sprawling buildings have possessed a self-contained convenience, but there was little sense of community.

In contrast, CityCenter is trying to create a neighborhood of sophistication, where its visitors and residents will stroll among seven buildings, to eat, shop and be entertained. Five high-rises will be devoted to guest rooms, residential condo or condo-hotel units.

Although the buildings are being designed by star architects, the most distinctive may be the Veer Towers, an aptly named pair of 37-story, inclining glass high-risers.

An entertainment and retail district will front on Las Vegas Boulevard, with some shops, such as a gourmet grocery, catering to the resort's residential population.

The largest structure - a 61-story, 4,000-room centerpiece tower - will be more conventional by Las Vegas standards, meaning it will include a massive casino, 18 restaurants, six bars and lounges, an 1,850-seat theater, convention center, spa, fitness center, salon, and four-pool swimming area.

Altogether, CityCenter will have about 7,600 living spaces on 76 acres. The resort will have its own public transit system - a tram that will link to MGM Mirage resorts Bellagio to the north and Monte Carlo to the south.

If you want to see what's coming, including sample condo units, you can visit the sales pavilion just south of Monte Carlo.

Echelon Place

2010

Plans for Boyd Gaming Corp.'s $4 billion project on the north end of the Strip (where the Stardust once stood) have some similarities to CityCenter.

For instance, Echelon Place with have about 5,300 high-end guest rooms in five hotels of varying styles, including Shangri-La, a Delano and a Mondrian. The largest hotel, the Echelon Resort, will have about 2,600 rooms in one tower and 700 rooms in a suites tower.

It also will have a huge casino, dozens of restaurants and entertainment venues, a shopping promenade, and a convention center.

But, unlike CityCenter, there are no condos on the drawing board. Still, there are about 20 acres of the total 87 that could be used for that purpose.

Echelon president and CEO Bob Boughner says a key objective is to cut down on the walking that guests have to do - a bane for many visitors.

Flippers flop as hot housing markets cool in Vegas, elsewhere

Nevada leads the nation in foreclosure rates as owners unable to sell became saddled with unbearable debt payments

RYAN NAKASHIMA
AP Business Writer
April 29, 2007

LAS VEGAS - In the rampant real estate speculation of the Las Vegas valley three years ago, people lined up outside Pulte Homes sales offices overnight as if they were waiting for the release of the latest video game console or hot new movie.

Having seen his house in an upscale part of suburban Henderson jump $200,000 in value in 18 months, Sam Schwartz felt he couldn't miss any part of the boom.

He spent the night in the parking lot with TV, snacks and drinks, along with about a hundred other people.

Schwartz intended to buy a new home and then quickly sell it within the year - for a huge profit. Most people waiting were flippers just like him, he said.

"We had seen real evidence of what was possible in this crazy, inflated market, and we just wanted to get a piece of that investment equity," Schwartz said.

But when home prices unexpectedly took a backward step, many investors seeking to cash in quickly were left "upside-down," or owing more on their mortgages than what their homes were worth.

The result was a glut of homes in the marketplace, communities spotted with empty houses and for sale signs - and a foreclosure rate in Nevada that leads the nation as owners unable to sell became saddled with unbearable debt payments.

Foreclosure filings across the United States rose 47 percent last month from a year ago to 149,150 - one for every 775 households, according to statistics from Realty Trac Inc., a foreclosure listing service. And for the third straight month, Nevada's foreclosure rate led the nation when it rose 220 percent from a year earlier to 4,738 filings, or one in every 183 households.

Realty Trac statistics show dozens of homebuyers in the Las Vegas area have more than one home in the foreclosure process - a telltale sign of investments gone wrong. One person has as many as 15 mortgaged properties in arrears.

The bulk of the state's foreclosures - or 91 percent in March - were in Clark County, which encompasses the Las Vegas Valley. One of every 30 homes in Clark County began the process toward foreclosure last year.

The day Schwartz reserved his home, the sales staff was raising prices $20,000 after every fifth buyer came inside. The $500,000 house he and his wife were eyeing had shot up to $540,000 by the time they sat down. Somehow, it still seemed like a good deal.

"Everybody was thinking, 'Hey it's not the end of the world, because the homes across town are selling for $720,000. We have almost $200,000 in equity in the house and it isn't even built yet,"' Schwartz said.

He and his wife put down $5,000 on a home that would end up costing $560,000 with upgrades.

While the Schwartzes were able to cancel before closing on a property that suddenly was worth only $490,000 - and recoup their deposit on a legal technicality - others were less fortunate.

Schwartz, a 44-year-old life coach, said he "narrowly escaped financial disaster." But the effects of the housing crunch would reverberate for years, he said, something he expects to see among the clients he coaches to succeed in their lives and careers.

"There's going to be a lot of depression, a lot of anger. A lot of drinking, gambling, and desperate stuff going on."

More than other states hit by the mortgage lending crunch, the high foreclosure rate in Nevada, California and Florida was driven by speculation, said Rick Sharga, vice president of marketing for Realty Trac.

"It was a combustible mix of risky loans and risky real estate deals," he said.

Russ Valone, the chief executive of research firm MarketPointe Realty Advisors, said speculators in San Diego were putting deposits on downtown condo units under construction, assuming they could sell them at a profit when they were finished.

"There were guys out there that were rolling the dice just as if they were going to Las Vegas," Valone said.

When the market slowed, many buyers forfeited their deposits, or let their properties get repossessed by the banks. As a result, the inventory of unoccupied condo units downtown since early 2005 has soared fivefold, he said.

California had the third highest foreclosure rate at one in every 389 households, and its 31,434 filings in March accounted for a fifth of the nation's total, Realty Trac said.

New home builders are slowing down the pace of new projects in Las Vegas and are giving agents commissions of up to 12 percent and up to $100,000 in upgrades such as pools, granite countertops and appliances.

"The speculators completely dried up," said Paul Murad, a real estate observer and author of "Manhattanizing Las Vegas."

In Miami, the rush of condo building and speculative buying has slowed to a crawl, said real estate agent Penni Hurley. Florida's foreclosure filings rose 54 percent from a year ago to 14,303 in March, or one filing for every 511 households.

"The market was on steroids and now it's going through a much-needed correction," Hurley said.

With forecasts of a nationwide 1 percent home price decline this year, there's no way to flip for a profit now, said Jay Brinkmann, vice president of research and economics with the Mortgage Bankers Association.

"One would have to logically assume that (flippers) are no longer in the market," he said.

But some are still feeling the pain.

Jason Beaver, a Sunnyvale, Calif.-based Apple Inc. programmer, got caught up in the talk of the hot housing market from friends who bought multiple homes in Las Vegas and made a killing.

His name was drawn in a buyers' lottery in the Solera subdivision and he put $35,300 down on a $353,000 home in February 2004. The community is restricted to people age 55 or older; the 37-year-old Beaver had no intention of moving in.

That summer, the housing market began to soften. He nervously put the house on the market for a break-even price the same day escrow closed. He got no offers.

A tight market had suddenly become flush with resale homes as investors sought to cash out. Pulte was one of several builders to slash new home prices, in some cases by as much as $80,000 in a single day. Beaver and others are suing, but the company has said it was simply reacting to new conditions in an overheated market.

Beaver has been renting the home out for about a $1,000 a month, despite monthly expenses around $2,000.

And the supply of available homes is growing.

In March, the number of resale listings for single family homes, condos and townhouses in the Las Vegas valley grew 30 percent from a year ago to 27,282, according to the Greater Las Vegas Association of Realtors. Sales and the value of homes sold were both down 38 percent from a year ago. About half the homes available have been on the market for more than two months.

"Two years ago, you'd set a price that looked right and you'd get offers that were $20,000, $30,000, $40,000 over your list price. You have to be more realistic today," said Devin Reiss, president of the Realtors association.

With Nevada's fast-growing population and an estimated 8,000 net new residents coming to Las Vegas every month, experts predict the glut of housing will be cleared in six months to more than a year.

State lawmakers are considering a range of bills that clamp down on the easy mortgage lending that helped heat up the market, including making it a crime for lenders to issue mortgages with little or no verification of a borrower's ability to pay.

"The biggest loan I ever saw, a person bought a $1 million property and only had to come up with $1,000 in cash," said Scott Bice, the state's commissioner of mortgage lending.

"I don't think anything will ever prevent speculation," he said, but added that new regulations and tighter credit requirements by lenders will eventually return the market to the good old days: "When it takes good credit and money in a transaction to close it."

For those caught up in the frenzy of a few years ago, the changes come too little, too late.

Beaver figures he has spent $50,000 on his investment home, and will have to come up with $30,000 more to pay off the mortgage after he sells it at a loss.

While he's not completely sworn off real estate investing, Beaver said next time he'll try a more traditional approach - to buy and hold for the long term.

"The fast-growth, make-a-quick-buck real estate investment, I don't think I'll try again," he said.