Tuesday, Oct. 26, 1999 | 10:36 a.m.
Daniel Blatteis hopes his company's new Las Vegas office will serve as a brokerage beachhead into the city's fast growing retail sector.
Blatteis became a significant player in the Las Vegas retail market when his firm, Los Angeles-based Blatteis Realty Company Inc., served as broker for the Grand Canal Shoppes at the new Venetian hotel-casino.
Hoping to build upon that success, Blatteis and business partner Robert Schnur have hired Frank Volk as their point man to run their new Las Vegas operation.
Volk joins the company from NewMarket Advisors, where he spent two years as a retail associate. In his new role, Volk serves as senior vice-president and managing partner of Blatteis & Schnur, the retail, restaurant and entertainment leasing subsidiary of parent Blatteis Realty. The company's new office is at 3960 Howard Hughes Parkway.
"We see the Las Vegas market as providing us with a huge opportunity to grow," said Blatteis. "The Forum Shops (at Caesars) were the first to offer a more sophisticated product in the market, and since then everybody and his brother have become interested in the Las Vegas retail market. And that (market) now includes more than the Strip. There's also other fast-growing areas, such as Summerlin and Henderson."
Las Vegas -- with its instant name recognition -- plays a key role in Blatteis Realty's nationwide expansion plans. The company already has offices in California and Chicago, and hopes to build on its reputation as an upscale retail broker. In addition to the Grand Canal Shoppes, Blatteis Realty has brokered property in several posh areas including Beverly Hills, San Francisco's Union Square, Chicago's Michigan Avenue and Times Square in New York City.
Despite the controversy surrounding the non-union status of the Venetian hotel-casino, the project's retail shops remain unaffected, Blatteis said.
"We're (the Grand Canal Shoppes) entirely leased except for one 4,000-square-foot space and another 900-square foot area," he said. "That's pretty good, considering we were looking at 500,000 square feet of retail."
Whether or not the Venetian moves ahead with a proposed second phase won't affect the current retail success, said Blatteis.
"We'd love to have another 1,000 rooms here, but this project is already successful on its own," he said.
As the man selected to spearhead the new Las Vegas office, Volk brings with him considerable local retail knowledge. His Las Vegas credentials include stints as broker or consultant for the Harley Davidson Cafe, Motown Cafe, Planet Hollywood and Coors Brewing Co., among others.
"I'm looking to grow the organization from scratch here," said Volk. "And we're looking at more than the Strip area. It's no big secret that the Northwest corridor, Green Valley and Summerlin areas are all experiencing tremendous growth. While we don't foresee a good deal of regional mall development over the next couple of years, there will likely be several mass merchandisers such as Wal-Mart, Target and Kmart looking to establish themselves in those fast-growing areas."
Volk believes that in the Strip's unique world of themed-upscale retail shops, success is contagious. Despite concerns about the Grand Canal Shoppes "dilution" of existing retail properties, Volk said competitors may have benefitted from the Venetian's retail offerings.
"What I'm hearing from the people at the Forum Shops (at Caesars) is that their (sales) numbers are up 15 to 20 percent for the year," said Volk. "Now, I don't know if there is any linear link between the Grand Canal's success and those numbers, but we're definitely seeing strong numbers in retail along the Strip."
George Connor agrees. "We're finding that the retail market is very deep," said Connor, senior vice-president of Colliers International's Retail Division. "The Strip has recently opened about 12,000 upscale new hotel rooms that are hovering around an average 93 percent occupancy. If you do the math on that, you find there's a lot of people with disposable income who are potential shoppers."
Connor said his company's recent experience with upscale retailer Sephora is illustrative of the Strip's attraction.
"We were consulted, and we advised them to open three stores -- all within one mile of each other -- on the Strip," he said. "They did, and that's because they recognized the market potential there."
Blatteis says the increasing presence of upscale retail on the Strip is partly due to construction of both the Venetian and Bellagio hotel-casinos.
"I think those two properties have helped raise the bar a couple of notches," he said. "And the fact is that the Las Vegas Strip is now one of the five most desirable retail areas in the country. People talk about how expensive retail space has become on the Strip, but compared to those other upscale areas it's still a good deal."
The annual rate for leasing prime retail space along the Strip currently runs between $60 and $200 per square foot, said Blatteis.
"By comparison, retail space in San Francisco's Union Square costs about $300 per foot, and prime space in Manhattan can run between $500 and $700 per foot. That's why I say the Strip remains a relative bargain."
Volk hopes to grow Blatteis & Schnur's Las Vegas presence by marketing that "relative bargain." However, he acknowledges that he may require some help along the way.
"There's a relatively small number of (retail) brokers in this city's talent pool," he said. "Initially, I think we will focus on growing our business on a qualitative basis. But I'm certainly not adverse to adding new brokers here. Either way, our long-term goal is to be the No. 1 retail broker in this market."
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