Friday, Sept. 30, 2005 | 10:45 a.m.
The days of building a standalone casino on or near the Strip are over.
Instead, the future of Strip-area development will be casino communities, a real estate expert said.
Richard Lee, vice president of First American Title Co., said plans are being geared toward the creation of "pockets" of self-contained communities on or near the Strip. Lee was the keynote speaker at Thursday's Society of Industrial and Office Realtors (SIOR) commercial real estate symposium.
"You can't pencil a self-contained standalone casino anymore unless you add condos, time shares and a fractional component," Lee said.
The rise of such developments is in part because of the real and perceived demand for residential property on the Strip and largely because land on the Strip has become cost prohibitive -- even for the largest casino companies, Lee said.
He cited MGM Mirage's City Center as an example of a planned casino community, calling it the most ambitious project of its kind. The first phase is a planned 18 million square feet. The development will include hotels, condos, time shares and a retail component.
"In any city, there are different neighborhoods that play off of each other," Lee said.
Other planned projects Lee noted as casino communities are the Hard Rock and its complex of planned condo units and the $3 billion Las Ramblas, a partnership between Las Vegas-based development group Centra and the Related Cos. that will include a casino as well as a spa, health club, dining and shopping.
There is more than $50 billion in planned and under construction projects along the Strip and radiating out on both sides of Interstate 15, Lee said.
"Fifteen billion dollars of it is projected to start in the next five years," he said. "It's mind boggling."
The big problem will be finding the necessary workers to build all those projects.
"There's not enough skilled labor to build half of what we're talking about west of the Mississippi," he said.
Lee also cautioned the crowd of real estate developers, brokers, owners and investors that only a small percentage of the announced high-rise condos will ever be built. He said that until a project is under vertical construction (when a building begins to take shape), it is debatable as to whether or not it will happen.
Using that criteria, Lee said there are currently 11 high-rise condo projects under construction and another 10 that are imminent. Lee said he has abandoned his "highly likely" list because so many projects have turned out to be shaky or unlikely.
John Restrepo, principal of real estate research firm Restrepo Consulting Group LLC, said during the panel discussion that he too does not believe that many of the 100-or-so condo projects will ever come to fruition.
"I am not convinced that we will see the (Interstate) 215 lined with condos," he said.
Lee said the last thing he wants to hear about is another multi-million luxury high-rise project coming to Las Vegas. He thinks the next wave of development will -- and should be -- two- and four-story developments that mix residential, office and retail uses.
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