Las Vegas Sun

September 1, 2014

Currently: 96° — Complete forecast | Log in | Create an account

Zappos would pay less for City Hall building under amended agreement

Image

Zappos: Henderson to downtown Las Vegas.

The deal to transform City Hall into the headquarters for Zappos.com is going to cost less than originally planned.

Because of renovations expected to cost $65 million versus the original estimate of $43 million, the city and Resort Gaming Group — which will purchase the building and surrounding downtown Las Vegas acreage, and then lease it to Zappos — have amended an agreement signed in December, which the City Council will consider next week. The new agreement calls for the city to sell the building for $18 million instead of $25 million.

The new deal would require Zappos to pay off a remodeling debt to the city, which will be the noteholder, in 15 years instead of 30 years. Hopes were that the sale of City Hall would help Las Vegas offset the cost of building another City Hall, which is being financed with $185 million in bonds. Las Vegas City Manager Betsy Fretwell said the new agreement means Zappos/Amazon will end up paying about 25 percent of the debt for the new City Hall.

Yearly payments for the building will be $11 million to $13 million.

Fretwell said city staff are “very excited” about what the Zappos move will mean for downtown redevelopment. Zappos’ staff is planning renovations to the old City Hall, and to make downtown and Fremont Street East a mecca for music, food, affordable housing and other cultural amenities.

Demonstrating Zappos’ commitment, CEO Tony Hsieh and other employees are leasing all apartments and condos on a single floor of the Ogden, a high rise one block from the current City Hall.

When the move happens, the company expects to bring 1,200 employees downtown, with the number expected to grow to 2,000.

CORRECTION: The original version of the story incorrectly stated that Zappos would purchase City Hall from the city of Las Vegas. Rather, Resort Gaming Group will buy the building and lease it to the online shoe retailer. | (January 5, 2012)

Join the Discussion:

Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.

Full comments policy

Previous Discussion: 4 comments so far…

Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

  1. This story paints a different picture than the one from Jon Ralston. Which is more correct?

  2. Libra: I think the better question is will Las Vegas have qualified candidates for these new positions, or will they have no choice but to relocate talent from out of state?

    It would be interesting to know how many high tech employees Zappos has had to bring in from out of state because the skills were not available locally, so the numbers can be presented to the gov the next time he cuts UNLV's budget.

  3. VegasEngineer,

    It's not only the skill level, but whether or not a prospective employee will fit into the company culture. That might matter even more to Zappos, from what I can tell.

    The skill sets are probably here for the most part, but the attitude is another question entirely. Whoever they hire has to have a very good grasp of what "outstanding customer service" means.

  4. FRM,

    They are *leasing* the building, not buying it. Small difference.

    No, this actually will spur some business development in downtown, mainly places like Subway and other places to have lunch. Any 24/7 pizza or Chinese food joint that delivers should do good as well.