Richmond American, local executive sever relationship

By Buck Wargo

Friday, Sept. 3, 2010 | 3 a.m.

The builder poised to take over the No. 1 ranking in home sales in Las Vegas by the end of the year has parted ways with its division president.

Ernie Belair had been with Richmond American Homes for 14 years, with the majority of that heading operations in Las Vegas. Denver-based Richmond American hasn’t given any reason for Belair’s Aug. 25 departure, but the popular Belair is expected to get snatched up by another homebuilder.

Despite the housing downturn, Belair is viewed in the homebuilding community as someone who has been able to cut costs, sell homes during a weak housing market and maintain a division’s profitability.

New-home sales have slowed considerably since the first-time homebuyer tax credit ended April 30, but large builders in Las Vegas such as Richmond American aren’t staying on the sidelines.

Through the first half of this year, Richmond American ranked No. 2 in total sales with 358, according to Home Builders Research. That is just behind D.R. Horton’s 406. KB Home was a close third with 327 sales.

But Richmond American is poised to take over the top spot by the end of the year because it has taken out 402 permits through the first six months of 2010 compared with 242 for D.R. Horton, which is ranked fourth in builder permits.

Richmond American, which builds lower-priced homes, has the most permits because it has the most active subdivisions of any builder with 24 or nearly 12 percent of the valley’s total, Home Builders Research President Dennis Smith said. D.R. Horton is second with 21.

“Richmond American has been the most aggressive in replacing lots and that has given it an advantage in selling houses,” Smith said.

Ryland Homes, which ranked 10th in builder permits through the first two quarters with 113, opened one of the newest subdivisions: Cordova Estates, a gated community in Henderson near St. Rose Parkway and Bermuda Road. Prices will start in the mid-$200,000s.

“If builders are going to stay in business, they have to replace the product because they are sold out,” Smith said. “The builders opening projects today usually have lots that are priced at a lower point. They have picked up distressed lots from either a bank or another builder.”

Builders are averaging about 0.3 sales per week per subdivision, which is back to where it was earlier this year, Smith said. It peaked at 1.1 sales per week in the last week of April when the federal homebuyer tax credit expired.

Director named

UNLV’s Center for Business and Economic Research has named a former Federal Reserve Bank director in Dallas as its new chief.

Stephen Brown, who took over the role Sept. 1, will oversee a center that is a resource for analysis of business trends and economic conditions in Las Vegas, the state and the region.

Since January 2009 Brown has been a nonresident fellow at the Center for Energy Economics and Policy Resources for the Future in Washington, D.C., and in March, became its co-director.

From 1981 to 2008, Brown held several positions at the Federal Reserve Bank of Dallas, including director of energy economics and microeconomic policy analysis.

Brown specializes in the analysis of economic and business conditions, regional economic growth, energy prices and aggregate economic activity, economics of government policy, global warming and energy security.

The center holds conferences twice a year forecasting the city and state’s economic outlook.

In addition to those duties, he will teach courses in economics at the undergraduate and graduate level and continue his research in regional economic growth, energy economics and economic policy.

He will also handle data collection for Nevada Kids Count, an annual report measuring the health and well-being of Nevada children.

Brown takes over the role held by Keith Schwer, who died in December.

Apartment outlook

Brokerage and research firm Marcus & Millichap predicts demand for apartment rentals in Las Vegas will pick up by the end of the year and that the vacancy rate will finish the year at 11.5 percent, up from 11.2 percent a year ago.

The firm is basing that on what it expects to be stronger employment at the national level. It says leasing activity has increased because of pent-up demand from renters who doubled up during the recession and those households displaced by foreclosures.

Owners should trim rents more for the rest of the year but that should slow as leasing increases. By the end of the year, rents will drop to an average of $804, a 2.1 percent decline over the past year. A year ago, they declined 5 percent and total 8 percent when including concessions.

Developers will have completed 1,500 apartment units for the year, about 200 fewer than a year ago. All of that was delivered in the first quarter.

The vacancy rate improved in higher-end complexes, finishing the first half of the year at 10.6 percent. It was 11.3 percent for lower-tiered apartments. Henderson’s vacancy rate rose from 9.1 to 9.6 percent because of 1,139 units added to the southeast valley, the firm reported.

Sales of apartment complexes are picking up and should accelerate the rest of the year because depressed prices are bringing out bargain hunters. In the first half of 2010, the median price per unit fell nearly 50 percent, which drove up sales 30 percent, the firm reported.

Condos affect housing numbers

The closing of high-rise units at CityCenter skewed the median price of new homes in July by about $15,000, according to Home Builders Research.

Director Dennis Smith said 86 new high-rise units closed in July, including 71 at CityCenter. The others were at Allure, eight; Turnberry, one; and Trump Tower, six. Thirteen high-rise condos closed at more than $1 million at CityCenter. The average price of the 86 sales in July was $715,687.

In other news

• The Financial Crisis Inquiry Commission is holding hearings in Las Vegas and three other cities affected by the financial crisis. The hearing is set for Sept. 8. The time and location haven’t been determined. The 10-member commission created by Congress will examine the causes of the financial meltdown.

• Terra West Property Management named Andrew Maiden as executive vice president of marketing and communications. Maiden had managed corporate communications, community relations and internal communications at the World Market Center.

• Greystar Real Estate Partners was selected by the Archon Group to assume leasing and management responsibilities for 27 properties across the country, including Savannah Apartments, 875 E. Silverado Ranch Blvd.

• Scottsdale-based multifamily property management firm Mark-Taylor Residential entered the Las Vegas market taking over two properties owned by BRIO Investment Group, San Diego.