Builder calls acreage buy ‘speculative’

Tom McCormick of Astoria Homes has purchased 38 acres of raw land in northwest Las Vegas for $3.3 million, though nothing is "imminent" for development, the home builder said Thursday.

It's more of a "speculative deal" with investors who have employed McCormick to help them acquire the property at Lone Mountain Road and Puli Road, west of the Beltway, he said.

"Hopefully, eventually we'll build, but this is a raw land deal, people buying into the future," McCormick said. "But we are optimistic and we are looking at some other things. Hopefully, things will continue to improve, and we can get started up again sometime soon."

McCormick, president of Astoria, took the company into "hibernation" when the Las Vegas housing market collapsed. While the new-home market is showing signs of recovery, it's still too early to jump back into the game, he said.

The land around Lone Mountain was originally listed for $4.4 million and reduced to $3.5 million, said Zoltan Hollo, managing director of US National Commercial, who represented Bank of Nevada in the sale.

"All I know is we had it on the market and reduced the price, and the bank is happy we sold it," he said.

Most builders are looking for finished lots that are graded with utilities and infrastructure already in place, Hollo said. This is raw land, once approved for 308 single-family homes, but the tentative map has expired, he said.

As land prices skyrocketed in the past decade, builders started downsizing lots and zoning for higher density. Now that prices have receded, they're going back to larger lots, targeting customers of higher-end homes, Hollo said.

Pulte recently purchased 56 lots in the master-planned Summerlin community, and D.R. Horton has made a couple of land plays in Henderson this year.

McCormick said the housing market remains uncertain with an estimated 75,000 Las Vegas homeowners at least 90 days delinquent on their mortgage.

"It's not the end of the world. It's just that nobody knows," McCormick said. "Every time (home) prices go up, somebody gets fixed. It gives people a little hope."

The new-home sector has cranked up production and closings in response to current market dynamics in Las Vegas. Median price points have remained above $200,000 for the second month, with prices exceeding $100 a square foot for only the second time in the past 20 months, according to SalesTraq research analysis.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.