In my humble opinion:
Platinum was one of the first condo/hotel projects to come to market. We
've spoken to a few owners over the last two weeks who were unhappy with the
rental program fees. Since the rental program is marketing it where the
hotels are renting rooms they units are getting good exposure and in general
the owners report the units have 70% or higher occupancy. One the flip side
there are limitations if an owner wants to rent on his/her own and the fees
for the in house rental program are fairly high.
Re sale pricing is good now, as with the entire Vegas Valley, it is very
much a buyers market and there is opportunity to purchase at reduced prices.
As of last week there was a one bedroom available for $369k at Platinum and
also at MGM, the only two projects that are completed. Trump and Palms are
on schedule to open this year and these are in many way very different
projects.
On the one hand MGM has a casino *as will the Plams) but the square footgae
of units is much smaller than the Platinum which does not have a Casino.
Rumor has it that a few owners at MGM Residences have been voicing the
opinion about not getting in rotation in the rental pool. These are rumors,
which may have something to do with the fact that the condo hotels are
suites and therefore the nightly rates are higher than standard room and I'm
guessing that unless someone requests the CondoHotel or a suite the main
hotel would be booked first weith the condo hotel suites booked for
over-flow.
That being said in general there is a 90% to 97% occupancy of all hotel
rooms in Vegas year round and often reports of a room shortages surface
during major conventions or big holidays.
The Palms CondoHotel should start closing sometime mid 2008. The Palms is
one of the hottest hotel/casinos off the strip and is always booked so the
Buyers who purchased have a good chance at seeing a lower vacancy rate,
especialy since they limited the number of units they nbuilt to just 599
units. We do have one Palms Buyer willing to bail on his reservation at a
loss, hoping to sell for $650k, when other buyer bought for closer to $700k.
In regards to placement of the development, no doubt center strip demands
are higher but South Las Vegas Blvd has a ton of developments and plans in
place. Also, the downtown developments and the Union Park project should
bring back a bit of glimmer to downtown Las Vegas, although this is long
term and someof the major projects are just now under way such as the
Medical Reseach and Performing Arts Center.
The bottom line is many people are panicking due to individual reasons, both
in the condo hotel and the residental real estate market. many
inexperienced invstors came to vegas when the market was hot and purchased
with the goal of a quick flip and large financial gain. As evidenced by the
mortgage market and the number of foreclosurs, many of these specultive
investors were not really in a fanancial positin to purchase and didn't head
the warnings that markets go up and down just like the stiock market. If you
are a savvy real estate investor you know the market goes up and down and
you invest and plan accordingly.
The Vegas market is normalizing after being over-heated for 3 years. We
attended a condo high rise association meeting where Grant W. Govertsen of
Deutsche Bank Securities spoke and they report seeing the Las Vegas Economic
Fundamentals good thru 2012. Read it at
http:// www.lvhca.com
Olivia McClellan, ABR, GRI, RRG
Corporate Broker REALTOR®
Triple8 Associates Inc
5940 S. Rainbow Blvd. Ste 1007
Las Vegas, NV 89118
Direct 702-372-2671
Fax: 702-543-4845
Olivia@OliviaSellsVegas.com
Visit me online at
http:// www.OliviaSellsVegas.com - Sat Jan 5 2008, 13:50