Las Vegas Sun

March 29, 2024

Strip timeshare project future being debated

Developers of a 54-story luxury timeshare tower planned for the Las Vegas Strip say the project could funnel hundreds of new visitors each day to surrounding casinos -- timeshare owners who generally spend more and stay longer in town than typical hotel customers.

Still, one of the Strip's largest casino operators is opposing the project, which would be built adjacent to the Showcase mall and near the MGM Grand casino resort.

The resort's owner, MGM MIRAGE -- which is planning to build its own condominium complex with condo developer Turnberry Associates behind the resort -- says timeshare developer Westgate Resorts has devised a project that doesn't make sense for the Strip.

"This is far too large a project on far too small a property that doesn't even have the appropriate infrastructure," MGM MIRAGE spokesman Alan Feldman said.

Potential competition with MGM Grand or the Turnberry condo complex isn't a factor, Feldman said, nor are rumors that the project could obstruct views of MGM MIRAGE's panorama of Strip resorts.

"Timeshares are a wonderful thing as long as they are built appropriately," he said.

Other major Strip operators may also register objections to the project before an upcoming county commission vote on the project Wednesday, Feldman said.

If built, the 700-plus unit complex -- which would be built where a Denny's restaurant now stands in front of the Showcase mall parking garage -- would alter the skyline of Las Vegas, instantly becoming the city's tallest occupied building. It would also feature one- to four-bedroom units averaging about 1,500 square feet as well as a swimming pool, health spa, restaurants and 63,000 square feet of retail space on the first and second floors.

The observation tower next to the Stratosphere hotel-casino, north of Sahara Avenue, is 115 stories.

MGM MIRAGE's objection coincides with concerns of county planners, who recommended denial of the project to the Clark County Planning Commission. The commission last month still approved the project, though certain waiver requests by developers were rejected. The requests would have placed the project closer to the Strip sidewalk.

The project could create traffic problems due to limited Strip frontage and access, planners said. In addition, a request to reduce setback requirements from the Strip "appears to be excessive," according to a staff analysis presented by the county's Current Planning department.

"This reduction would locate a substantial structure over 400 feet high approximately 40 feet from Las Vegas Boulevard. ... The height of the tower poses a problem with the minimal site size bordering overbuilding on the site."

A local advisory board appointed by county commissioners also recommended denial based on concerns about traffic and limited access.

Westgate Resorts President and Chief Executive Officer David Siegel said Wednesday that the project will move forward.

MGM MIRAGE's position is "mind-boggling," Siegel said, adding that the property expects to meet local requirements as well as boost business for the casino industry and generate tax revenue.

"We will be building 1,000 (rooms) without a casino. That means up to 1,000 people staying here each night without (MGM MIRAGE) paying a dime for it."

"Las Vegas needs this project," he added.

Unlike the hotel or casino industries, the timeshare business is "recession-proof" because owners use their units regardless of economic whims, Siegel said. In gambling towns, timeshare owners tend to spend more in casinos than hotel guests because they don't have to budget for accommodations. They also tend to stay longer, he said, generating business midweek when tourist traffic ebbs, he noted.

Despite the presence of Fairfield Resorts and other newer timeshare complexes, Las Vegas is still a fairly untapped timeshare market, Siegel said. Of the several million timeshare owners in the world, a significant number have requested exchanging accommodations with timeshare owners in Las Vegas but can't because of limited supply, he added.

Westgate has scouted the Las Vegas market for years, nixing a site at the Greek Isles casino on Convention Center Drive because it was too far from the Strip, said David Atwell, president of casino resort brokerage Resort Properties of America.

The Orlando company bought a condo complex on Flamingo Road out of bankruptcy -- renaming it Westgate Flamingo Bay -- as an experiment to test demand for timeshare units in Las Vegas.

"They're a tremendous company with a great track record," Atwell said of the company. "The timeshare customer has proven to be very good for Las Vegas, as they stay longer and become insurance for the city. And with land prices on the Strip these days, you've got to build straight up to make it work."

Westgate will be a boon for business on the Strip, added George Connor, senior vice president of the retail division of broker Colliers International in Las Vegas.

"Anytime you can add (housing) to the Strip you'll see families and have repeat customers," Connor said.

The project's ground-floor retail space is also warranted, he said, given the 30,000 to 35,000 visitors who pass on the sidewalk each day.

The Showcase mall's Las Vegas-based owner Makena Entertainment, which also controls the adjacent land, formed a joint venture with Cleveland-based mall developer Forest City Enterprises Inc. to sell the rights to the development to Westgate. Westgate would lease the retail rights in the complex back to Makena.

The tower is projected to generate millions of dollars in sales to casinos in the form of entertainment and gifts to entice potential timeshare customers, Siegel said. It also will mean hundreds of construction jobs and permanent positions at the company, which already employs about 500 people in the region.

Westgate, which began developing timeshares near Orlando's Disneyworld, claims to be the largest privately held timeshare developer in the country. It generated $400 million in sales last year and is second only to Marriott International Inc. and Fairfield Resorts Inc. in the size of its timeshares, which typically run about 1,000 rooms each, Siegel said.

The company is known for developing "themed" timeshare resorts that blend in with their surroundings. A resort in Tennessee's Smoky Mountains features log cabins, a complex in Williamsburg, Va. employs people dressed in colonial garb and a Park City, Utah property resembles a modern ski lodge.

Eleven of the company's 15 resorts are located in Florida. Many of its properties offer multi-room units with amenities such as large-screen TVs, kitchens and Jacuzzi bathtubs that appeal to big families or groups traveling together.

The Las Vegas tower will have a Latin-flavored "Miami South Beach" theme, all the way down to the building's sailboat design, employee uniforms and artwork, Westgate officials said.

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