If you live in southwest Las Vegas, you have new neighbors.
The Bureau of Land Management held a major federal land auction Thursday at its northwest Las Vegas field office, unloading more than 160 acres, much of it near Blue Diamond Road and in other parts of the southwest. All told, the land sale brought in nearly $24 million, although not without a few twists and turns in front of a standing-room-only crowd of more than 100.
An investor got into a bidding war with a big homebuilder. Some parcels went for twice their market value, while others squeaked through with just one bidder at their base asking price. And the biggest plot of all — about 250 acres in northeast Las Vegas — went unclaimed altogether. There was no shortage of action for observers and bidders alike.
“I think it went great. It was obviously successful,” said Merv Boyd, a consultant with land-consulting firm Abbey, Stubbs and Ford who took in the auction from the front row. “There was a lot of interest and multiple bidders on most parcels. The BLM did a great job on the structure and process. The market’s been soft, and I’m encouraged by what I saw.”
Part of what Boyd saw was American West Development dominating the bidding. The locally based homebuilder bought more parcels — five pieces totaling 27.5 acres — than any other bidder.
“We think we did pretty well. We bought a couple of pieces we didn’t plan on buying, but the price was so good,” said Jeff Canarelli, American West’s senior vice president.
Canarelli said American West has nearly 4,500 home lots in the Las Vegas Valley. Some of the parcels the company bought are lower-density, rural-preservation areas that won’t allow more than two homes per acre, but they’re worth hanging onto for a while to see where the market goes, Canarelli said.
American West, which spent $4.7 million Thursday, didn’t skate through the auction challenge-free.
The builder had to fight an individual investor to snag 10 acres at the northeast corner of Wigwam Avenue and Tenaya Way. American West’s first bid was $1.65 million, and from there, the two sides bid back and forth more than 35 times. The audience got restless: One observer guessed the woman had no idea what she was bidding on, and another wondered whether she had a daughter. She caved at $2.1 million, clearly not knowing how near she came to winning.
“We were close (to stopping). We had one or two bids left,” Canarelli said.
But the 10-acre site wasn’t the parcel that got the most bids. That honor went to a 2.5-acre plot zoned for commercial-general use at the northwest corner of Serene Avenue and Fort Apache Road. Five bidders went back and forth 47 times, boosting the $250,000 market price up to a final sale of $730,000. Southwest Growth Management came away the winner.
The parcel that saw the most bidders, at six, was a 5-acre site at the southwest corner of Rainbow Boulevard and Ford Avenue. American West started the bidding at $925,000, but an individual investor ended up buying the lot, zoned for office-professional use, for $1.3 million.
The property that landed the highest price above its market value was a 7.5-acre parcel that straddles El Capitan Way just south of Blue Diamond Road. The opening fair-market value was $750,000, but the acreage went for nearly three times that price, at $2.2 million. Clark County lists the planned land use for the parcel as office-professional.
And the cheapest lot? American West grabbed it — a $200,000 parcel on 2.5 acres at the northeast corner of Cougar Avenue and Jerlyn Street.
The biggest prize had no takers, though.
The bureau set a starting value of $2.59 million on 247.6 acres at the southeast corner of Hollywood Boulevard and Cheyenne Avenue, but nobody bit.
Canarelli said later that the site has a gravel pit on it, and its location near Nellis Air Force Base could mean noise-mitigation issues.
Boyd added that another party owns the mineral rights to the dirt. Any buyer would have to try to negotiate to buy those rights, with no guarantee of success.
Yet, that property will find a new owner someday, Boyd said.
“It will go because of its location. It’s just a matter of working things out with the underlying owner,” he said.
Thursday’s auction was notable for its status as the second-biggest local bureau land offering since November 2005, when the agency auctioned nearly 3,000 acres valleywide. More than 440 acres were available Thursday, although less than half of the land sold.
Thursday was also the first oral auction since the recession’s start in 2007. Bureau spokeswoman Hillerie Patton said the agency holds oral auctions, rather than written ones, when they expect a large number of interested buyers. The next auction in May or June, will be an oral auction, Patton said.
Land ends up on the auction block after a prospective buyer sees a parcel suitable for a project he wants to build. He then asks the city or county where the land is to nominate the lot for sale. That’s why land sales slowed so dramatically in the recession and why so many acres were up for sale on Thursday. Lot demand mirrors economic growth.
Sale proceeds go to the state’s education fund, the Southern Nevada Water Authority, public parks and the purchase of environmentally sensitive land. Past auctions have funded the $25 million renovation of Lorenzi Park, as well as the visitors’ center at Red Rock Canyon, outdoor features at the Las Vegas Springs Preserve and amenities at Lake Mead.
Contact reporter Jennifer Robison at firstname.lastname@example.org. Follow @J_Robison1 on Twitter.