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WINTER 2015
I-15
I-15
215
215
95
515/95
CONDOMINIUM
CONDO-HOTEL
CityCenter-Mandarin Oriental-Veer Towers-Vdara
Sky Las Vegas
Allure
One Las Vegas
Boca Raton
Panorama I & II
The Martin
One Queensridge Place Newport Lofts
Soho Lofts
Juhl
The Ogden
Turnberry Towers
Regency Tower
Signature (Turnberry MGM)
Trump
Palms PlacePlatinum
Park Towers
Metropolis
Las Vegas Valley
HIGH-RISES
Coldwell Banker Premier has facilitated a multitude of high-rise transactions in Las Vegas. We draw on this experience and information obtained from local government and the Greater Las Vegas multiple listing service. The information is deemed reliable but is not guaranteed.
Las Vegas Valley
HIGH-RISES
lasvegashomes.com
Las Vegas Valley
HIGH-RISE TIMELINEApproximate Dates Closings Began
lasvegashomes.com
Update on the
LAS VEGAS HIGH-RISECondominium Market
YEaR-OvER-YEaR COmpaRIsON - mLs
NOTE ThaT muCh Of ThE buILdER INvENTORY Is NOT pOsTEd ON ThE muLTIpLE LIsTINg sERvICE sO ThIs sERvEs as a sampLE aNd NOT ThE fuLL uNIvERsE Of pROpERTIEs. fuRThER, avERagE saLE pRICEs musT bE vIEWEd WITh CauTION duE TO ThE vasT dIffERENCE IN ThE sIzE Of hOmEs sOLd bETWEEN ThE TWO pERIOds.
While we see each high-rise project as a market unto itself, for brevity, we occasionally refer to the “market” for high-rises.
The high-rise market is a very nuanced story to tell due to the very specific nature of each project and because of the shifting ownerships over the past
couple of years. The most recent wave of development saw the delivery of many new buildings at exactly the worst time, amidst a national recession.
This was followed by a market characterized by free-falling prices, loan defaults increasing and whole builder portfolios becoming distressed. Today,
the market is much stronger, however it is not always reflected in sales trends
because supply is much more patient, with far less distressed owners.
Sales velocities are at a much more metered pace, a parallel to what we
are observing in the single family home market as well. This pertains more
to a market-wide sense because some developer held projects continue
to achieve respectable sales velocities, while others are more concerned
with price maximization. In the resale market, a wide mix of ownership
implies a broad set of reasons to sell and now that financial distress
largely removed, the market is moved more by traditional reasons such as
job transfers, settling of estates or lifestyle changes.
High-rise prices are ticking up gradually, corresponding with a generally
improving labor market and additionally some major Las Vegas Strip
projects on the horizon or under construction are buoying confidence
in the sector. The re-emergence of some financing products should also
help demand for high-rise homes.
Single family homes have already seen a solid run-up in values over the
past couple of years and high-rise homes have largely lagged that cycle but do
appear to be gathering some more organic interest by owner occupants, some
RELaTIvE saLE pRICEs - Q3 2015
of which are making these homes their primary residence. As the single family market has become more fully priced, opportunities to buy high-rise
residences with likely upside appear to be present in today’s market. Additionally, you could not build most of these buildings for what units trade
for today, a possible signal of a longer-run upside. What remains relevant is the relative value play between Las Vegas and major markets like coastal
California, which reflects a major disparity in prices for comparable product, with the exception of valuing an ocean view and having access to large
job markets. While Las Vegas does not have an ocean view, a sea of lights at night and daytime territorial views continue to resonate with buyers.
Additionally, tax considerations remain a primary, non-lifestyle reason to own a residence in Nevada.
Actively Marketed Projects
2015 has seen a few major shifts in either ownership of bulk unit holdings or in marketing
activities surrounding current sponsor sales. Recently, Pathfinder Partners purchased the
remaining 64 homes at Sky Las Vegas from the original sponsor so this project may be
added to the actively marketed list at some point.
Conversely, The Residences at Mandarin Oriental within the CityCenter campus can
essentially be considered to have a completed sales cycle and will be coming off of the
lasvegashomes.com
sOuRCE: mLxChaNgE.
actively marketed list. Although delivered during a challenging economic period, the project has preserved value better than many of the other Las Vegas
projects of the same era and prices have been on an uptrend for the past several years.
Similarly, One Queensridge Place, which consists of two towers located in the Summerlin area of west Las Vegas is also a completed sale project. Taken
together, both The Residences at Mandarin Oriental and One Queensridge Place signal that Las Vegas has become a true luxury living destination with
vertical living options.
Another CityCenter project, Veer Towers, originally sponsored by CityCenter Residential and later sold in bulk to Ladder Capital in 2012, remains an actively
marketed project by Pordes Residential. Veer’s highest post recession sale occurred in September which was a larger west building home on the twenty-
first floor. The sale was $2 million or $886 per-square foot, a high water mark figure for 2015 so far.
Turnberry Towers, an adjacent strip option, also continues it sales program and recent offerings have started from the high $200,000’s for one bedroom and
$530,000 for two bedrooms and $827,000 for three bedrooms. In the third quarter, closings have averaged about four per-month.
The newcomer to the actively marketed list is One Las Vegas on the South Strip. Homes are being marketed from the low $200,000’s for one bedroom
homes, the high $200,000’s for two bedrooms and the low $400,000’s for three bedrooms. Recent closings have been between approximately $230 and
$250 per-square foot.
Downtown, The Ogden remains the only actively marketed for-sale project, closing about four per-month on average in the recent quarter and ranging
from about $260 to $323 per-square foot. Projects like these are not always a perfect guide as to what sales rates may be since there has been a
longstanding rental component that have to be cycled through before certain units become available. This may be a similar consideration at Sky Las Vegas
or One Las Vegas.
For condo-hotels, Palms Place and Trump continue to reduce their inventories. Trump had some good sales velocities over the summer, selling a handful in
July but selling fourteen homes during August and September, some of which appear to be investment buyers picking up multiple units. Similarly, Palms
Place continued to have some traction. Occupancies in the hotel sector have been quite good, so the lodging component of these investments has pushed
some owners into positive cash flow.
Reflecting on the market
While the market has certainly improved in recent years, not every project can be called a winner and one really needs to think about the market as
close to the project level as possible. The market still bears the scars of the financial crisis and Las Vegas’ building craze, however this has translated
into opportunities for others and the market continues to cure itself with more solid borrowers and stronger equity positions. The capital groups that
have purchased bulk units in the recent years have been professional and well capitalized, moving the market out of the distressed rut and back onto
firmer ground.
The region’s improving job market, strong hotel occupancies and visitor volumes also bode well for the sector. The Strip properties in particular are
likely to be beneficiaries of both under construction and realistically planned projects, such as the nearly complete MGM-AEG arena and although
starting out slow, Genting Group’s Resorts World Las Vegas is likely to help move the center of gravity of the Strip further north. The Las Vegas
Convention and Visitors Authority’s plans for the former Riviera Hotel and Casino are likely to build more connectivity between the Strip Corridor and
the Convention Center area. Additionally, Crown Resorts Alon plans a project on the New Frontier site. Carl Icahn has recently started seeking a buyer
for the partially built Fontainebleau site so it will be interesting to see who purchases the property and what the ultimate plans may be.
hIgh-RIsE CLOsINgs aNd saLE pRICEs pER-sQuaRE fOOT - Q3 2015
sOuRCE: CLaRk COuNTY, COLdWELL baNkER pREmIER REaLTY.
One important aspect of current marketing to note are the high commission rates being offered to brokers, nearly all of which are above 4% with
many at 5% with occasional additional bonuses. Over the summer, several projects ran additional promotions where buyers would have one or two
years of HOA paid, resulting in a material difference between the offered price and the net price the seller receives. Some of these specials persist
into the fall and winter. Additionally, some projects have run occasional promotions on specific units.
lasvegashomes.com
Historical Sales Activity in the High-Rise Sector - Includes Builder Sales and Resales
Supply Additions and Cumulative Supply
sOuRCE: CLaRk COuNTY, COLdWELL baNkER pREmIER REaLTY.
sOuRCE: CLaRk COuNTY, COLdWELL baNkER pREmIER REaLTY.
maNY Of ThE spIkEs WIThIN ThE TWO TRENds bELOW aRE duE TO dELIvIERIEs Of NEW pROduCT OR a REpOsITIONEd pROjECT.
Inventories
SUBMARKET/PROPERTY
SOUTH STRIP
RESORT CORRIDOR
CONDO-HOTEL
DOWNTOWN
SURBURBAN
ADJACENT STRIP
TOTALCLOSED
FOR SALEMLS*UNITS
Boca Raton 378 176 5 202 1
One Las Vegas 359 70 20 289 -
TOTAL 737 246 25 491 1
Allure 428 428 31 – 2
Sky Las Vegas 409 345 19 64 3
CityCenter Mandarin Oriental 225 223 18 2 –
CityCenter Veer Towers 669 530 68 139 –
TOTAL 1,731 1526 136 205 5
CityCenter Vdara 1,495 147 14 1,348 –
Palms Place 599 481 75 118 4
Trump 1,282 823 62 459 -
The Platinum 255 239 26 16 3
Turnberry MGM (Signature) 1,728 1,640 55 88 3
GRAND TOTAL 5,359 3,330 232 2,124 10
Juhl 341 34 2 305 –
Newport Lofts 168 168 15 – –
Soho Lofts 120 120 8 – -
The Ogden 275 74 12 201 –
TOTAL 904 365 37 506 –
GRAND TOTAL 6,453 5,103 453 1,348 13
One Queensridge 218 218 28 - 1
TOTAL 218 218 28 - 1
Metropolis 71 71 8 – -
Park Towers 84 84 11 – –
Regency Tower 274 274 23 – –
Turnberry Place 777 777 66 – 1
Turnberry Towers 635 489 29 146 1
Panorama Towers I & II 650 650 61 – 2
The Martin 372 372 29 7 –
TOTAL 2,863 2,717 227 146 6
LENDEROWNED
DEVELOPEROWNED**
* Active inventory, not under contract.** Either owned by the developer or a new owner of multiple homes such as Dune or CIM. Further, the bulk sale of Veer is still considered in the developer owned category. Total Closed refers to all closings that occurred from project start date to the end of the current quarter that traded on a retail or resale basis.
Note: Much of the supply of developer owned homes are in the rental stock. Examples include One Las Vegas, The Ogden, Sky Las Vegas and Juhl.
lasvegashomes.com
Strip Corridor
Adjacent Strip
SALES & PRICINGBeginning at 2005 when several condominiums became active
Adjacent Strip
Note: Prices can vary substantially between sample periods. Prices reflect view and floor premiums and may also vary by finish level. Does not include recent bulk transactions.
lasvegashomes.com
South Strip
Adjacent Strip
Surburban
Downtown
Note: Prices can vary substantially between sample periods. Prices reflect view and floor premiums and may also vary by finish level. Does not include recent bulk transactions.
lasvegashomes.com
Condo–Hotel
Note: Prices can vary substantially between sample periods. Prices reflect view and floor premiums and may also vary by finish level. Does not include recent bulk transactions.
Trump has sold units in bulk and those are not reflected here. The above exhibit corresponds to traditional arms-length (retail or resale) transactions.
Note: Still being marketed by the originalsponsor. Sale price per square foot icludesgrey shell.
Closed Developer ow ne d (m ay be rental ) Le nder o wnedOn M LS
RESORT CORRIDOR
ADJACENT STRIP
lasvegashomes.com
Closed Developer ow ne d (m ay be rental ) Le nder o wnedOn M LS
ADJACENT STRIP -Cont
SUBURBAN
DOWNTOWN
SOUTH STRIP
Closed Developer ow ne d (m ay be rental ) Le nder o wnedOn M LS
CONDO-HOTEL
Closed Developer ow ne d (m ay be rental ) Le nder o wnedOn M LS
Coldwell Banker Premier has facilitated a multitude of high-rise transactions in Las Vegas. We draw on this experience and information obtained from local government and the Greater Las Vegas multiple listing service. The information is deemed reliable but is not guaranteed.
Coldwell Banker Premier Realty Strategic Services
John McClelland – Vice President of Research702.938.1375 • [email protected]
lasvegashomes.com8290 West Sahara Avenue, Suite 200
Las Vegas, Nevada 89117