California buyers scooping up ‘cheap’ Strip condos
Steve Marcus / Las Vegas Sun
After several dismal years brought on by the recession, sales and prices at luxury high-rises on or near the Strip are rising.
The condo market, while far from booming, is rebounding thanks to drastically lower prices and an improved economy.
“It’s getting a lot better, but slowly,” said Tony Dennis, executive vice president of developer CityCenter Residential.
This year, 220 new high-rise condos sold through July at an average price of about $741,000. That’s up from 111 deals during the same period last year, at an average price of $454,000, according to Home Builders Research President Dennis Smith.
The average sales price of previously owned Strip-area condos is $489,000 this year, up from $306,000 last year and $225,000 in 2010, Realty One Group agent Emily Armstrong said.
CityCenter residences are helping to fuel the uptick.
At the 47-story glass and steel Mandarin Oriental, buyers have snapped up more than 60 developer-owned units this year. That’s up from two last year and four in 2011, Clark County property records show.
CityCenter developers MGM Resorts International and Dubai World are selling the condos for $650 to $700 per square foot — a far cry from the $1,600 a square foot they reaped in early 2007, when the tower was under construction. Most of those buyers later backed out when the real estate market crashed, and those who remained were given a steep discount on the price.
Geff Hanoian pounced on a good deal. He bought a one-bedroom, 1,100-square-foot 39th-floor condo this year for $635,000. Hanoian, who lives in the southwest valley and owns a small technology services company, Pier64, plans to make the Mandarin his full-time residence.
“They’ve kind of dropped their pricing into reality, which is what attracted me,” he said.
Veer Towers, also in CityCenter, is benefiting from lower prices, as well.
Buyers this year have picked up 61 units there and were in escrow for another dozen as of Aug. 6. In 2011, only 10 units sold.
The two 37-story buildings, which lean at a 5 degree angle, contain 335 units each.
New York’s Ladder Capital and Florida-based Pordes Residential Sales & Marketing bought 427 Veer condos in December for $119 million cash — a bargain price of about $300 per square foot. The investors put 100 units up for sale a month later and hope to sell their entire portfolio in three years.
Condo salesman Jim Navarro is leading the effort. His group is selling Veer units for $400 to $700 per square foot.
Almost all of the buyers so far have paid cash, and 80 percent plan to use their condos as part-time homes, he said. Most are from California.
Navarro attributes the sales growth in part to lower prices. CityCenter used to charge more than $1,000 per square foot.
Sales also have been boosted by California’s rising real estate values and the improved stock market, which have improved clients’ net worth.
“People feel wealthier,” Navarro said.
Overall, developer-owned condos seem to be faring better than resales, which are selling at a slower pace, Realty One Group agent Jim Brooks said.
Still, despite the uptick, the condo market is a far cry from the valley's single-family housing sector, Brooks said.
Investors have been buying houses in bulk throughout the valley to turn into rentals. Practically every house gets multiple offers, sometimes within minutes of being listed, and locals complain they get beat by cash buyers.
In the condo market, “we’re not seeing crazy hype like we are with single-family,” Brooks said.