LV office developers attracted to suburbs

Brian Seals

Monday, June 8, 1998 | 9:28 a.m.

Some of the new office space in the Las Vegas Valley will be following the housing market to the suburbs.

That was the recent message from Tom Thomas, managing partner of the Thomas and Mack Co., to about 50 commercial real estate professionals at a breakfast sponsored by the Commercial Marketing Group.

As residential areas in places like Summerlin and Green Valley continue to swell, office space will likely follow.

"It's long been our view we would start seeing relocation of traditional central core services to a satellite stretching of services out to the northwest and southeast," Thomas said.

The company boasts the 100-acre McCarran Center and the 12-story Nevada Financial Center at Sahara and Rancho among its stable of properties.

But Thomas said in the next few years the Summerlin and Green Valley areas will see more office space for services like law, insurance, banking and accounting. For example, Thomas and Mack is building the Eastgate office complex in Green Valley near Warm Springs Road and Stephanie Street.

The Eastgate complex is a four-story and a three-story building with a total of 147,000 square feet of space. It includes a 5,000-square-foot pad for a financial institution. The project is scheduled to be ready for occupancy by the third quarter of this year.

Thomas said his company will focus in the next two years on this type of project to provide office space in the Valley's suburban areas. The Howard Hughes Corp. is also seeing the same trend. Though it still has construction plans for its Hughes Center east of the Strip and at its Hughes Airport Center, the company is also building office space in its Summerlin developments, adding 200,000 square feet of office space there this year.

"Much of our growth will be in Summerlin," Hughes spokesman Dale Erquiaga said by phone.

Another major development player in the Valley, American Nevada Corp., is also bolstering its suburban office presence. The company plans to open a two-story, 70,000-square-feet office building in October near Green Valley Parkway and Lake Mead Drive.

American Nevada, however, is also teaming with Nevada State Bank on a new downtown Las Vegas office building. The Greenspun family controls both American Nevada and the Las Vegas Sun.

The trend towards suburban offices comes at a time when office space near McCarran International Airport is becoming scarce, Thomas said. Thomas said his company's McCarran Center office development will be built out in the next 18 months. That complex will have about 1.3 million square feet of space when filled to completion.

Two recent developments have helped fill space there. The California State Automobile Association will be housed in a two-story, 54,368 square foot building and Thomas said an announcement will be made soon that a Southern California company employing 400 will be locating at the complex.

"The airport area is running out of space very, very quickly," he said.

Along with that, the days of the large-scale office complexes could be facing obstacles. Large parcels of land needed to make master-planned office complexes work are becoming more and more scarce.

"We don't see a lot more assemblages without BLM auctions," Thomas said. "It is very difficult if you try to go out and assemble a 100-acre office park."