Las Vegas Newest Master Planned Community

The direction of the Las Vegas real estate market has taken a new twist with the opening of Inspirada, Las Vegas newest masterplanned community in the foothills south of Las Vegas. The developer claims that local Las Vegas residents are looking for an old fashioned sense of community and is building homes clustered around town squares with limited auto access. It remains to be seen whether residents really are looking for more interaction with their neighbors, or if developers, paying top dollar for rapidly diminishing land, are trying to spin the fact that they are putting in much higher densities to maintain their profit levels.

'Urbanist village' planned near Henderson air field
By HUBBLE SMITH REVIEW-JOURNAL

People are tiring of row upon row of cookie-cutter homes designed for 1940s suburbia, the developer of the master-planned Inspirada community in Henderson said Thursday.They're starved for interaction with their neighbors and a sense of community, Focus Property Group Chief Executive Officer John Ritter said at the opening of Inspirada's information center.

"We're sick of post-World War II homes," he said. "We fell in love with our cars and fell out of love with our neighbors. The street ends up looking like a line of garages." The 1,940-acre development near Henderson Executive Airport will become a leading example of the "new urbanist village" concept of community design, Ritter told a gathering of business leaders. KB Home is building 5,000 of the estimated 11,000 homes at Inspirada and has 17 models open. These Las Vegas homes should be ready for move-in by September. "When you look at KB's models, it's like nothing you've ever seen in Nevada," Ritter said. "It's pretty stunning. Some of the bankers and investors in this deal came through and their comments were quite amazing. I don't think anything like this has been done in the country, let alone Nevada."

Focus and a consortium of home builders paid $557 million for the acreage at a Bureau of Land Management Auction in 2004. It was passed over in a previous auction because of "inclusionary zoning" requirements from the city of Henderson, which were later removed. Most of KB's homes are single-family detached on smaller lots clustered around a central courtyard, Nevada division President Don DelGiorno said. About 15 percent of the residences will be attached Las Vegas condos and townhomes."We'll move with the market," he said. "If a certain product sells better, we'll react to the market."

Floor plans of Rembrandt City townhomes range from 1,640 square feet to 1,980 square feet. Prices start in the high $200,000s. The Renoir garden-style detached homes are 1,375 square feet to 2,040 square feet, also priced from the high $200,000s.

Ritter, a member of the Washington, D.C.-based Urban Land Institute that advocates so-called "smart growth" development, said Focus had been studying new urbanism projects that had been "springing up" around the country. "I remember the day I went into a meeting with the consortium group and saying, 'Guys, let's do new urbanism in this project.' They said, 'What does that mean?' 'Well, it means higher density.' We had no idea what we were getting into," Ritter said.When he met with Henderson planning officials, Ritter found that they knew more about new urbanism than he did. They had been looking for an opportunity to do it, he said."It's been painful at times, kind of like herding cats, but ultimately, it's been successful," he said.

Henderson Mayor Jim Gibson said Inspirada captures the "small-town notion" valued by Henderson residents, even as it has grown to be Nevada's second-largest city."It really was an exercise for all of us because it was so huge and complicated, there wasn't anyone it didn't touch," Gibson said. "It was an enormous undertaking for the city."Ritter said the "last piece of the puzzle" is a 300-acre town center with mixed uses such as lifestyle entertainment, retail, restaurants and a boutique casino."I think, over time, you'll see the vision realized. Ultimately, this will be a role model in this country for the new urbanist community," he said.The community, east of Interstate 15 off St. Rose Parkway, will eventually be home to 26,000 residents with 300 acres of recreational land and 20 miles of trails. Toll Bros. has opened a sales center at the community. Other builders include Woodside, Kimball Hill, Meritage and Beazer.

The Las Vegas Building Boom

The price of Las Vegas homes for sale is likely to see another round of appreciation in the near future fueled by all the new casino jobs being created with the Strip's building boom. In the downtown area, Las Vegas condos are being developed with these casino employees in mind, reminiscent of New York City or San Diego's ritzy Gaslight District. The impact on the Las Vegas real estate market overall is already being felt as inventories are starting to recede from last year's highs.

THE STRIP: Help wanted, a lot of it
Building boom expected to create 113,500 casino jobs
By HOWARD STUTZ REVIEW-JOURNAL

MGM Mirage's Project CityCenter, which includes a 4,000-room hotel-casino, four high-rise condos and a condo-hotel totaling 2,700 rooms, is one of many under way Strip projects that will someday need staff. Project CityCenter isn't expected to open until 2009, but MGM Mirage is already taking steps to fill an expected 12,000 positions.

Casino operators believe they will have no problem filling hotel rooms with guests and packing casinos with free-spending gamblers during the current building boom, which is expected to bring at least four new resorts to the Strip and an estimated 45,000 more hotel rooms to the Las Vegas market by 2012.

Finding enough employees to clean the rooms, work the restaurants and staff the casinos may not be as easy. Deutsche Bank Securities, in a report to its investors, said the Las Vegas casino industry will need to hire some 113,500 workers for the positions being created by the new resorts. Analysts for the Wall Street investment house believe if the current growth rate in Clark County's population continues unabated, there will be a shortfall of some 25,000 jobs left unfilled.

Bill Lerner, who authored the report for Deutsche Bank, said older casinos will be hit by the open positions as qualified workers flee for newer and more attractive opportunities. Lerner said a job shift took place during the most recent casino hiring wave in 2005 and 2006. Wynn Las Vegas, the South Coast (now called South Point) and the Red Rock Resort hired workers from competing casino properties.

"Las Vegas resorts have not had an issue attracting labor, particularly at the newer high-end properties," Lerner wrote in the report that was released last month.

He said Wynn received more than 110,000 applications for 9,000 positions while Station Casinos had 100,000 applications for 2,600 jobs at Red Rock Resort. The bulk of those applications, he said, came from workers at existing Las Vegas properties.

"We believe this could occur with new supply as well, shifting workers to the newest properties, and potentially causing a shortage at older properties, " Lerner said. "Ultimately, we expect if there were a shortage, properties could buy labor if necessary, while the economy nationwide could play a part as well. We expect that a labor crunch could weigh on property margins."
The resort corridor is already swelling with construction activity. Las Vegas Sands Corp. plans to open the $1.8 billion Palazzo later this year with 3,025 rooms. Wynn Resorts Ltd. has begun construction on Encore, a $1.4 billion, 2,000-room resort expected to open in 2008. MGM Mirage's $7 billion Project CityCenter, which includes a 4,000-room hotel-casino and four high-rise condominiums and condo-hotels totaling 2,700 rooms, is also under way.

Meanwhile, Boyd Gaming Corp., is preparing the closed Stardust site for Echelon Place, a $4 billion project that totals 5,300 hotel rooms. Also, Station Casinos is expected to break ground this month on Aliante Station, a $600 million hotel-casino in North Las Vegas.

According to Deutsche Bank, the number of potential jobs is based on a formula of 2.5 workers per hotel room. The investment house also believes that Clark County's estimated average growth rate of 7,300 new residents a month through 2012 will miss the mark.

"Historically, Las Vegas population increases have fallen short of that level, with the exception of 2004 which came close with an average of almost 8,800 new residents a month," Lerner said.
He added that the economy nationwide could play a role in bringing more potential workers to Southern Nevada.

"For instance, high unemployment rates in another region could spur workers to move to Las Vegas," Lerner said.

D. Taylor, the secretary-treasurer of Culinary Workers Local 226, which represents more than 60,000 hotel and restaurant employees, agreed that a labor shortage could be on the horizon unless the casino companies begin taking steps to avert the crunch. He said the middle to upper end of the job scale would be the most impacted unless the industry undertakes a serious job training program.

Taylor said the union's Culinary Training Academy graduates 3,000 employees annually, but he'd like to see that figure climb to 7,000.

"The companies need to break through rhetoric and create internal training and mentoring programs for their workers," Taylor said. "Some have embraced that concept and it will be a big issue in the upcoming contract talks. It's imperative for the industry that a career ladder inside these companies be created so employees can develop different skills in order to better themselves."

Casino operators are mostly unconcerned about a potential labor shortage. Seeing the amount of applications filed for recent casino openings give them hope of similar numbers.
Las Vegas Sands spokesman Ron Reese said the company should begin the process for filling an anticipated 4,000 positions at the Palazzo this spring.

On the other end of the timeline, Boyd Gaming spokesman Rob Stillwell doesn't think the labor pool will dry up when Echelon Place is ready to hire workers, possibly by 2010.

Meanwhile, MGM Mirage is already taking steps to staff 12,000 positions at Project CityCenter, which covers the hotel-casino and Vdara condo tower. The development isn't expected to open until 2009.

Richard Vosburgh, senior vice president of human resources for MGM Mirage who is overseeing the CityCenter hiring, said at least half of the development's employees will come from other company hotel-casinos. MGM Mirage operates 10 Strip casinos.

"Because 12,000 is a starting point, the ripple effect is creating a tsunami," Vosburgh said. "We'll have to fill the same position two or three times because some will leave Mirage for CityCenter and another person will leave (Treasure Island) for that position at the Mirage. That will create some challenges."

MGM Mirage expects 100,000 applications for jobs at MGM CityCenter, which will be hiring workers after the Palazzo and Encore have filled their staffs. "Sometimes, you'll get 10 applications for one position and three or four for another," said Michael Peltyn, vice president of staff for CityCenter. "That's where we're challenged to grow the applicant pool," he added.

Las Vegas Land in Short Supply

This article from today's Las Vegas Review Journal provides an overview of land scarcity in the Las Vegas Valley. Our personal opinion is that in a few short years, once builders have sold most of the inventory being built in the newest master planned communities, traditional housing prices in Las Vegas will soar as new residents continue to move to the Valley filling jobs now being created in the latest casinos and Las Vegas high rise condo developments on the booming Strip.

Land scarcity may drive homebuilders away
By Brian Wargo / Staff Writer
Housing analyst Dennis Smith says don't be surprised if some homebuilders "close their store" in Las Vegas this year.

Smith, president of HomeBuilders Research, predicts one, two or three big public homebuilders will leave the market or merge, and it's not because of a lack of demand. Instead, Smith blames the shrinking supply of land that became even more of a problem in Las Vegas real estate when national builders cut back on their supply of land across the country.

"It looks like it's difficult for the builders to replace the lots they are absorbing," Smith said. "If a builder stopped buying land six months ago, they didn't stop selling houses. Call any builder and it's difficult for them to find land to buy for two or three years out."

Smith said he's been sounding warnings about the lack of available land for traditional housing development in the Las Vegas Valley. About five ago, he said he suggested there was about a 10- to 12-year supply of land remaining within the Bureau of Land Management disposal boundary for a typical builder to develop a typical single-family subdivision. Today, if a single-family homebuilder is not participating in Summerlin, the Focus Property Group master plans in Henderson and Las Vegas or the new Olympia Group master plan in North Las Vegas, where are they going to go to acquire any large number of lots to position them for the future?, Smith asked.

He added that 2006 was another example of the tight land supply. Some builders mistakenly believed land prices would decline as the demand for housing softened, he said.
"If they expected Las Vegas land prices to decline as a result of this change, they were mistaken," Smith said. "If there was a larger supply of land available, the prices would have decreased. Overall, land prices didn't change much. This is due to the overall short land supply. Builders will again soon begin buying land to maintain or increase lot supplies for future communities."

Some builders have also contacted other builders about their Las Vegas land, Smith said. As for Centex Homes, which in January pulled out of a deal to build homes in Henderson, Smith said he wouldn't be surprised if the builder started looking for land again in the coming months.