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September 1, 2014

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Quiet on the northern front

Downtown condo tower mostly empty as revitalization efforts limp along

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Steve Marcus

Most units are dark around 8 p.m. Monday on the north side of Streamline condo tower in downtown Las Vegas. A little more than half of the building’s units have sold four years after sales began. City officials remain confident, however, that the project will be a success.

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Streamline Tower, 425 Fremont St., opened May 1. Just a handful of residents have moved into its 275 units. Despite the unsold units, city officials, including Mayor Oscar Goodman, remain positive. "I think this is a great time to invest in downtown Las Vegas," he says.

The glossy sales brochure for Streamline Tower, a swanky new high-rise condo building in downtown Las Vegas, includes a photo of a dozen nicely dressed people milling about near the building’s front entrance.

But that’s not often the case — not yet, anyway — for Streamline, which broke ground in 2004 and opened its doors May 1.

Only a handful of tenants have moved into the 21-story building. And though its developers have been trying to sell their 275 units for four years, only 156, or 57 percent, have been sold — the lowest percentage among five major condo projects either recently constructed or in the works downtown.

That poses the question: Are high-priced condos like Streamline — developed to take advantage of a slowly revitalizing downtown city core — ahead of their time?

Las Vegas Business Development Director Scott Adams insists not.

“At the end of the day if you want to be in the heart of downtown, where do you want to be?” Adams said. “Streamline is in a great location.”

The condo project is one block from City Hall, bordered by a vacant lot to the north, Fremont Street to the south, Neonopolis to the west and the old El Cortez, which is dwarfed by the large condo, to the east.

Streamline offers the amenities of most new high-priced developments, including units with generous floor plans and designer touches, a workout room and a rooftop pool with views of the Stratosphere and Strip hotels.

When asked whether she is concerned about the high percentage of unsold units, Streamline sales director Susan Allen said, “Not right now.”

“Obviously, we’d like it to be better,” Allen said, blaming slow sales largely on the stalled local and national economies. “It’s just a matter of weathering the storm right now.”

Of the 156 units sold at Streamline, about 20 have completed the closing process, Allen said. But that’s because Streamline owners delayed closings until they received initial certificates of occupancy April 30. Now that the process has begun, Allen anticipates a steady stream of additional closings soon.

She conceded, however, that some buyers likely will drop out because of skittish lenders and the overall economic malaise.

And there may be other factors. Part of turning around downtown means reducing crime rates and the sometimes glaring signs of homelessness.

But Allen said locals notice these things more than out-of-towners. And it’s folks from out of state — typically, she said, from states such as California, Arizona and Florida — who are buying.

It’s been Mayor Oscar Goodman’s hope that these condos would help to develop a new base of downtown residents in an area historically bereft of them. Goodman, Adams and other officials point to several signs indicating the city may be turning that corner.

The Fremont East District, just to the east of Las Vegas Boulevard, appears to be picking up steam with a number of clubs that have opened or will soon. Neonopolis has finally signed a number of tenants on its ground floor and other big deals are in the works, none bigger than Union Park, the centerpiece of a new and gleaming downtown, assuming all goes to plan.

Add to that the fact that most of the city’s major condo projects have been completed or are making steady progress — a goal some other condo and loft projects around the Las Vegas Valley have not reached — and the signs are pointing in the right direction, boosters say.

Other recent condo projects downtown include SoHo Lofts at Las Vegas Boulevard and Hoover Avenue, Newport Lofts at Casino Center Boulevard and Hoover, Juhl at Fourth Street and Bonneville Avenue, and Allure Tower, just inside city limits at Sahara and Fairfield avenues.

SoHo, the first of the projects, has sold all of its 120 units. Newport, Juhl and Allure have sold 62 percent, 67 percent and 85 percent of theirs, respectively, according to city statistics.

SoHo, which began “preselling” in 2003, was sold out about six months before it opened in June 2006. Its regular units were priced from $379,000 to $800,000, with penthouses ranging from $3.5 million to $5 million.

Sluggish sales recently prompted Newport Lofts, which opened in August, to lower its prices by 30 percent-plus, according to sales executive Adam Gafke. Its units now range from the mid-$300,000s to the mid-$600,000s, and penthouses run from $900,000 to $1.6 million.

Allure Tower, completed at the beginning of this year, is priced from the mid-$400,000s to $2 million. And Juhl, still under construction, will feature condo lofts ranging from the high $300,000s to $700,000.

Although Streamline’s prices — $469,000 to $1.35 million — fall within that range, it has had difficulty finding buyers, even with promotions such as one last summer in which the $205 million project gave away BMW convertibles worth $37,000 to five buyers.

Although retailers are supposed to fill several street-level store spaces, none has committed and the storefronts are empty. But Liz Clare, a Commerce CRG broker working with Streamline, said a high-end market/deli is just days away from signing an agreement for a 3,000-square-foot store. Other projects also are in the works, she said.

Allen insists that despite the vacancies, the property is in sound financial shape. She said there have been no discussions about turning the property into rental apartments, a step sometimes taken by condo developers who don’t sell enough units.

Allen added that while many out-of-state buyers are keeping their Streamline condos as second homes or vacation properties, and so won’t be living there full time, that may change as downtown becomes a more desirable place to live.

City officials concede that downtown, with its lingering seedy image and lack of basic amenities such as a full-service grocery store, has not yet fully come of age.

“We’re still a work in progress,” said Margo Wheeler, Las Vegas’ director of planning and development. “I think there was a feeling that a downtown renaissance would be happening more quickly.”

But Wheeler is optimistic that downtown’s evolution will continue.

And Goodman? The question doesn’t really need to be asked.

“I actually see this as a wonderful time, to be honest,” the mayor said. “I think this is a great time to invest in downtown Las Vegas.”

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