Downtown LV projects slow to get off ground

Diana Sahagun

Thursday, May 9, 2002 | 10:54 a.m.

One of the first agenda items that piqued the interest of newly elected Mayor Oscar Goodman in 1999 was a proposal by the San Diego-based Tom Hom Group to build two housing developments in downtown Las Vegas.

Two groundbreakings later, and near the end of his four-year term, Goodman is still waiting for his curiosity to be satisfied.

Construction delays are common in new development throughout the valley, including the redevelopment of downtown Las Vegas. But Goodman and other city officials are learning the hard way that with the fanfare of groundbreaking ceremonies often comes a disappointing wait for downtown projects to get off the ground.

At least four downtown redevelopment projects are idling because of construction delays, financial issues or a sense of caution after the Sept. 11 terrorist attacks -- leaving city officials frustrated.

"I think frustration is an understatement," Goodman said. "But the good news is that I know (these projects) are ultimately going to take place. The bad news is it doesn't happen fast enough."

Pioneer Plaza is the latest redevelopment project to be sidelined, after a champagne-soaked groundbreaking ceremony in late December. While construction of the four-story law office was scheduled for early this year, the lot at Fourth Street and Clark Avenue remains vacant.

Jamie Chrisman of the firm Barker, Brown, Busby, Chrisman and Thomas said one of the project's tenants, a court reporting firm that was supposed to occupy one floor, has backed out of the project. The city has given the developers 60 days to secure financing and find a new tenant or the development agreement -- by which the city would contribute $300,000 and the land -- will be voided.

But Pioneer Plaza isn't the first downtown project to be hit with delays. After several announcements and groundbreakings in the last year, other projects remain in limbo as well.

The Tom Hom Group broke ground on Kirby Lofts and L'Octaine -- two residential housing developments -- in December 2000 but has yet to start construction. City officials say the company is firming up financing -- through state bonds -- and construction should begin by the summer.

It has also been nearly a year since Chelsea Property Group announced plans to build a high-end outlet mall on 39 acres at the corner of Bonneville Avenue and Grand Central Parkway. While the company had planned to break ground by the first of this year, there remains a "For Sale" sign on the property. A company spokeswoman said Chelsea plans to close escrow on the property by the summer and break ground shortly thereafter.

James Goodell, a member of the Urban Land Institute, a Washington-based think tank, said redevelopment is always slow, but downtown Las Vegas has some unique issues.

Downtown Las Vegas is a challenging market, he said, because the surrounding area is so attractive to developers. Downtown development often entails negotiating with city leaders and facing related hurdles that are not part of private development.

"Clark County is so attractive and lucrative that the alternatives to downtown are plentiful," he said.

Goodell said the key to making downtowns prosper -- like in San Diego and Dallas -- is setting a clear vision for the area, and making projects conform to the plan.

"The cities that have made this work in California and elsewhere are cities that have adopted a plan that has a vision and a broad sign-off within the community and civil leaders," he said. "And I don't perceive that in Las Vegas. You have to have something out there that everyone is working toward."

The vision, Goodman says, is a downtown where people can live, work and play. And there are projects moving toward completion, he added.

The city broke ground on the Lewis Street corridor pedestrian project in February, and construction is ongoing. Reno developer Steve Biagiotti in March broke ground on City Center Apartments, a 300-unit complex at Eighth Street and Bridger Avenue that is under construction.

Developers of a proposed furniture mart have purchased nearly half of the land for the 56-acre project. The developers closed escrow in November on 20 acres west of downtown Las Vegas, for $15 million. Shawn Samson, a managing partner of the project, said the company plans to turn dirt by the end of the year.

Boyd Gaming Corp. has teamed up with Idaho developer Larry Leasure to build a 6,500-seat arena to house the minor league hockey Las Vegas Wranglers. Construction on the arena, at Stewart Avenue and Main Street, is scheduled to begin in September.

Goodman said it took three years for the city to get ownership of the downtown post office and four years for Neonopolis to open its doors.

"Unfortunately I wish I controlled everything," Goodman said. "All I can do is use my energy to make sure everyone feels they're being treated right by the city. I have no quit in me and the city will have no quit in it."

Lesa Coder, the city's business development director, said the delays are not just a product of redevelopment, but they happen in the private sector as well. The events of Sept. 11 caused financing companies to take a new look at projects and whether they will be viable, she said. In the case of the latest delay, the one affecting Pioneer Plaza, Coder said her office is continuing to work with the firm to find a new tenant for the project.