Strong condo interest may signal downtown revival

Jennifer Shubinski

Friday, April 9, 2004 | 10:38 a.m.

The intersection of Las Vegas Boulevard and Hoover Avenue, near Charleston Boulevard, doesn't hold much interest for most people. There's a vacant lot at one corner and some nondescript office buildings on another.

Dona Maria Tamales Restaurant, near the intersection for more than 20 years, draws some traffic, but other than that it's the waning end of Las Vegas Boulevard.

But not to developer Sam Cherry and business partner Harris Rittoff, who have developed the Adobe Ranch Apartments and Adobe Plaza commercial center in Henderson.

If Cherry has his way, that downtown intersection -- and the current vacant lot at the southwest corner -- will be the site of downtown's first high-rise condominium tower.

Cherry said he could have gone anywhere in town, but he wants to be in the inner core. He sees Mayor Oscar Goodman's vision for a vibrant downtown community and wants to be a part of that.

Cherry apparently isn't the only one sold on the revival of downtown Las Vegas.

He said 45 of the project's 120 units have been presold -- though the project is in a neighborhood most Las Vegans have never visited, let alone thought about living in.

The presales have been for units ranging in size from 1,500 square feet to 1,784 square feet, for prices ranging from $379,000 to $650,000.

The units still for sale range from about 1,200 square feet to more than 1,700 square feet and start in the mid $300,000s. Eight penthouses ranging in size from 4,000 square feet to 5,100 square feet are priced up to $2 million.

By comparison, the price of a new single-family detached home in February was $219,795, with the average square footage hovering around 2,000 square feet.

Presold means units sold before a hard contract has been written. Interested parties make a reservation and put down a refundable deposit of $5,000 to lock in a unit and its current price, Cherry said. With 45 reservations, Cherry has collected $225,000.

Local real estate experts said that a project of this type -- in an unproven location with little-known developers -- can only command refundable deposits. The type of deposit, refundable or nonrefundable, also depends on the stage of the project, they said.

Cherry and Rittoff plan to open a sales trailer by the end of this week across the street from the site and plan to start infrastructure work in May. They hope to begin construction on the building in June. Total project costs, including land acquisition, are expected to be $60 million.

Cherry bought the .69 acre of land in January for $1.19 million.

Plans call for retail stores and restaurants on the ground floor of the roughly 250-foot-high, 15-story building.

Unlike other high-rise condo towers in Las Vegas that are sold unfinished, units at SoHo Lofts will be finished units; furniture is all that will be needed.

A mock-up of a unit will open for viewing at Neonopolis near the beginning of May, Cherry said.

Cherry said local attitudes are changing, as more people are looking for an alternative to the production housing typical in Las Vegas and as the market gains more interest from investors and second-home buyers.

The idea of a vibrant, revitalized downtown has been slow to take off but is now moving at a brisk pace, said Cherry, who said he receives three to four phone calls a week from developers interested in the downtown area.

"People are ready to live downtown, to walk to work, ride the Monorail, take advantage of high-rise living," he said.

Las Vegas native Jimmy Porrello, 26, is one of those people.

Porrello and his wife, Angela, bought a house in the planned community of Southern Highlands not too long ago.

The newlyweds said they are ready to shed their suburban lifestyle and head downtown.

"I want to live more of a city life," said Jimmy Porrello, an insurance broker. "I want to live down there, shop down there and be entertained down there."

To gain the city life, the Porrellos will lose about 1,000 square feet of living space. The unit the Porrellos have bought at SoHo Lofts is 1,600 square feet.

Jimmy Porrello hopes that the downtown area will evolve into something similar to San Diego's Gaslamp Quarter, a dining, shopping and entertainment district, where his brother now lives.

"I think downtown is the next spot," he said.

That people are buying units before a model is even available for viewing speaks to the viability of the market, said Tim Sullivan, the principal in charge of real estate consulting with the Meyers Group.

"It's a cool and funky product," Sullivan said.

More people, locally and nationally, have their sites on downtown Las Vegas as the next place for the valley's development boom, analysts said.

Ironically, as the growth in housing and construction drew people over the years out of the city's urban core, it is that development that is one of the factors drawing people back in.

As builders quickly reach the line in the sand that is the valley's boundary -- set by both natural constraints (mountains) and federally owned land that surrounds the area and that in most cases can only be sold via auction or released by an act of Congress -- they are looking inward for affordable, available, land parcels.

Local land and development expert Richard Lee said as the valley's land prices have increased, so has the interest from developers in downtown and high-rise projects.

"There was not this demand a year ago, but with the high cost of land and housing, people think 'where else can I live, what else can I do,' " he said. "Typical western thinking is to go out, out, out and we have, but it's a matter of attitude and the attitude about downtown is that this can be a really cool place."

And it's not just condo developers that see the potential.

Mark L. Fine & Associates announced last year it plans to build an office building on 4.5 acres at the southwest corner of Bonneville Avenue and Grand Central Parkway near the Las Vegas Premium Outlets mall. Andy Katz, president of Manpower of Southern Nevada employment agency, and partner Jim Barbarite bought the vacant First United Methodist Church at Third and Bridger streets with plans to convert it to an urban coffee cafe and offices.

But it was Chelsea Property Group's Las Vegas Premium Outlets, which opened last year at Grand Central Parkway and Bonneville, that opened up people's eyes to downtown, Lee said.

"Sometimes it's the first pioneer, then all of a sudden there's a thought, an idea, and it causes other people to think about it and then developers start looking to build out there," he said. "People are spending money downtown."

Cherry's SoHo project is one of a number of high-rise condo towers on the drawing boards for downtown Las Vegas and citywide.

Another reason the SoHo Lofts have grabbed the attention of would-be city dwellers is the rising popularity locally of high-rise condos valley wide, although the majority are located near the Strip.

The success of luxury high-rise condominiums Turnberry Place on Paradise Road and Park Towers on Flamingo Road has other developers chasing the second- and third-home markets and locals looking at these new alternatives to single-family homes.

The city, too, hopes to build on that popularity, and just closed a request for proposals for use of about two acres downtown at Third Street and Bonneville. Among the proposals were high-rise tower projects from Cherry and a separate one from a group of investors that includes Lee.

"This is an alternative lifestyle and people are looking for cool, eclectic places to live close to their jobs; it's a strong emerging market," Lee said. "This happens in cities all over the country."

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