Its development stuck in limbo, what’s next for Kyle Canyon?

By Sam Skolnik

Wednesday, March 25, 2009 | 2 a.m.

Before the local economy soured, Las Vegas and developer Focus Property Group had big plans for Kyle Canyon Gateway, 1,712 acres of largely undeveloped land near Mount Charleston.

The development plan provided for as many as 16,000 homes, retail and commercial properties, and a large hotel, 15 stories or taller, on the site both northeast and southwest of the Kyle Canyon Road exit on U.S. 95.

Those plans — at least as far as Focus and its partners are concerned — fell apart last year when Wachovia Corp., the deal’s main financial backer, foreclosed on the property and filed suit against the developers to recoup hundreds of millions of dollars in loans.

The project appeared dead.

Its supporters and detractors were left with the same question: What now becomes of Kyle Canyon?

The answer may ride on the results of the Ward 6 City Council race between incumbent Steve Ross and attorney Jennifer Taylor.

Ross avidly supports the project, noting its many civic benefits, including new community centers, parks and fire and police stations — and the jobs a big hotel would bring.

Taylor, who lobbied the City Council against the project two years ago as co-founder of the group North West Residents for Responsible Growth, takes the opposite view — that a casino is the last thing needed, and that many homes would make for a far too densely populated area.

According to the city attorney’s office, the development agreement the city reached with Focus and its partners is still in place even though they are no longer involved with the project.

Wachovia is working on its own plans for the site — plans that could require that the deal be amended.

Soon after it became the site’s owner, Wachovia — which in January became a wholly owned subsidiary of Wells Fargo & Co. — hired a real estate management and consulting company, Winchester Carlisle.

“We need to see if there’s a better use for the property,” said Brian Walsh, Winchester’s vice president for development. “Everything is an open book right now.”

Wachovia wants to fully explore its options and pursue the best plan for the site, Walsh said. That includes discussing options with neighbors and city officials, and hiring a land planning consultant to do a complete survey of the site.

Walsh said he has met with city officials, including Ross and City Manager Betsy Fretwell.

He was reluctant to say whether a hotel would remain part of the project.

Ross said the casino should stay in the plan. He said it wouldn’t be a “neighborhood casino,” and would be at least two miles from any houses.

(Last month a group of neighborhood activists filed an ethics complaint against Ross, claiming he violated state ethics laws by voting for projects, including Kyle Canyon Gateway, that would benefit the union members he represents as secretary-treasurer of the Southern Nevada Building and Construction Trades Council. Ross called it a political stunt designed solely to aid Taylor.)

The Kyle Canyon Gateway plan, which Ross said was two years in the making before it was approved, shouldn’t change at all, except possibly reducing the number of houses planned.

Ross said that ultimately it’s up to the City Council to approve any significant amendments — and he doubts that will happen.

That could change if Ross is defeated in the April 7 city primary. Council members typically look to the representative of the ward where a project is located for direction on how to vote. And Taylor has her own ideas about how Kyle Canyon should be developed.

“I’m not opposed to a multi-use development, but it has to fit within Ward 6,” Taylor said. “We don’t need stacked-up houses, one on top of the other. It was a bad agreement from the get-go.”

That includes the notion of a casino, she said.

“We need to look for a different industry,” she said. “We have to get away from being a one-industry town.”

Walsh said Wachovia wants to best use the site, regardless of who is representing Ward 6. But the company is alert to the city politics that may affect the development.

Wachovia is sensitive to Ross’ vision for the area, Walsh said, but “we’re aware that there’s a race going on.”