Monday, Oct. 21, 2002 | 11:14 a.m.
The Molasky Group of Companies, the veteran Las Vegas development firm behind such major projects as the Boulevard Mall, downtown's Bank of America tower and Sunrise Hospital & Medical Center, has sold five properties in Las Vegas in recent months for a total of nearly $150 million.
Irwin Molasky, the firm's founder and owner, today said the development company will use proceeds from the sales to invest in two new major projects in the valley, as well as several high-end apartment communities around Las Vegas and the southwest United States.
Molasky declined to reveal the type, scope or location of the two major projects he's planning in the valley, but said he hoped to unveil details by the year's end.
In addition, Molasky said financing is in place for nearly all of the seven luxury apartment neighborhoods he plans to build in Las Vegas with his sons, who own Pacific Properties & Development LLC.
Pacific will build apartment communities in Sacramento, Denver and Carlsbad, N.M. as well, Molasky said.
"We don't sell very often, but the offers we got for these properties were so attractive," he said. "We decided to sell and redeploy those assets into other projects.
"We have a high degree of confidence in the residential apartment market in Las Vegas. We're putting a lot of resources into a number of apartment projects here."
Molasky said the market's relatively high apartment-complex vacancy rates aren't deterring the company from its bullish outlook on the residential rental market.
"Certainly, (vacancy rates) concern us, but it's a cyclical market. As long as Las Vegas continues to get 6,000 to 7,000 new residents a month, we feel that vacancy factor will be mitigated."
Molasky added that his company's upscale, Class A apartment communities -- highly amenitized neighborhoods with an expansive roster of features such as pools, spas, clubhouses and apartments with finishing touches more likely to appear in new homes -- suffer less in soft markets.
Numbers from CB Richard Ellis support Molasky's contention.
The real estate brokerage shows a market vacancy rate of about 7.5 percent in Class A apartment neighborhoods, while vacancy rates in the mid-market and lower-end Class B and Class C submarkets are above 8 percent and 9 percent respectively.
Despite the apartment development plan, Molasky said the focus doesn't represent a change in direction for the firm.
"We are multifaceted. We've been doing apartments for years. We do residential housing, office and retail. We'll continue to do all those things. Our two new major projects are not apartments. We built a hospital, we build medical facilities. We're not shifting our strategy. We don't build it and they will come. We look at the market and see what the market needs before we design a project."
One shift in the overall market Molasky will testify to is the influx of smaller, out-of-state investment firms buying property in the valley.
All five of the properties sold went to companies based outside Nevada.
Texas-based commercial developer Trammell Crow bought Best on the Boulevard, a 200,000-square-foot retail center on Maryland Parkway near the Boulevard Mall, for $30 million.
Orangefair Co. LLC of Los Angeles bought the Costco-anchored SunMark Plaza, a 428,000-square-foot power center adjacent to the Galleria at Sunset regional mall in Henderson, for $46 million.
Los Angeles-based Damavandi Capital LLC bought the Park Place Shopping Center at Maryland and Twain Avenue for $12 million.
California-based Triple Net Properties LLC, which earlier this year purchased two other major office projects in Las Vegas, bought Bank of America West, an eight-story, Class A office building with 82,000 square feet of space. Triple Net brought the property, which is southwest of the confluence of U.S. 95, Summerlin Parkway and Rainbow Boulevard, for $17 million.
And in June, a Molasky Group affiliate sold the 472-unit Savannah Apartments at 875 E. Silverado Ranch Boulevard to Utah-based Arlie & Co. for $43 million.
"We have noticed an influx of people buying properties in Las Vegas," Molasky said. "With the extreme volatility of the stock market, I think investors are looking for more predictable returns. Real estate offers that. It's a tangible investment. People can look at it and see it and feel it. They don't lose their assets because of things that are out of their control."
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