High-end project banks on resilience of rich

By Mike Trask

Monday, April 21, 2008 | 2 a.m.

The view from Hong Kong billionaire Henry Cheng’s 3 1/2 acre compound will eventually be jaw dropping, a sight line so expansive that the Red Rock Casino will be visible clear across the city, beyond the Strip buildings poking up like figurines.

His 299 neighbors in Ascaya will enjoy something similar.

As the housing market continues its roll through the gutter, high above the valley — 150 feet higher than the Stratosphere — work is continuing on what may be the best 300 lots ever offered in Las Vegas.

It is the project that you can see from just about anywhere in the valley, the cuts into the mountain looking like stairs toward the clouds. (Opponents down in the flatlands see it more as a disgraceful defacement that has forever destroyed a view enjoyed by millions for the benefit of a few hundred rich people. But more on that later.)

Although no one wants to say it this bluntly, developers hope the slumping housing market is irrelevant to the class of wealthy person able to comfortably spend millions of dollars on a vacant Henderson mountainside lot.

In July, when the sales office for Ascaya is scheduled to open, they’ll test that thesis.

The lots’ sales prices have not been set but they likely will be at least seven figures. The total cost of the project, now four years in the making, is $250 million.

“The buyers are not as impacted by a recession as the middle-income buyers,” said John Restrepo, a real estate analyst who owns Restrepo Consulting.

Someone buying a lot for several million dollars typically has a large enough down payment — and bank account — that higher interest rates aren’t as troubling when buying a house.

Dennis Smith of Home Builders Research noted that high-end homes across the valley have taken a big hit, with some once priced at more than $3 million in areas such as Sun City Anthem in Henderson now listed at less than $2 million.

But for that $2 million you get a house. At Ascaya a hefty price gets you a section of rock. Building the custom home is extra.

“The market is a concern,” conceded Mike Kiggen, developer W.L. Nevada’s vice president of design and construction. “But it is a long-term project. It will take a long while to sell it out and build it out. We’ve been hearing from our sales team that the high-end market sales have been good.”

Each day from 6 a.m. to 6 p.m. more than 100 workers build winding roads, level lots and construct rock walls made from boulders blasted from the mountain.

In the end there will be 300 lots on 642 acres, with an average lot size of about .8 acre.

Kiggen doesn’t see much competition for the development’s potential buyers. Sure, there are other beautiful lots throughout the valley. And there is no shortage of gorgeous homes in locations such as Lake Las Vegas.

But nothing quite this special.

“There’s isn’t anything else with these views,” he said. “There’s nothing else like it. There’s a lot of uniqueness about the project with the view and the location.”

Cheng, who owns both the land and W.L. Nevada, plans to build on one of the premier lots.

Not everyone is thrilled about the exclusive community. Preservationists have opposed the project, saying it has obliterated the mountains’ natural beauty. Over the past four years, a battle has been waged regarding blasting at the site, with neighbors below complaining it shook their homes, even cracking windows and foundations.

Those complaints led to lawsuits, a series of sometimes contentious meetings and, eventually, changes to Henderson’s blasting laws.

Now, however, the blasting is nearly complete. All permits needed by Ascaya have been received.

The project’s first section, including about half of the lots, is expected to be finished in September; the second in March.

“I don’t think I’ll be able to get past the guard house,” said Joe Miller, the project manager, half joking that his construction manager’s salary will not be close to what’s required to join the elite.

If all goes as planned, the first homes will be built on the mountain in 2009.