Mike Montandon’s career has come full circle.
Montandon arrived in Las Vegas at the dawn of the modern boom era as a commercial real estate appraiser. He took a 12-year-detour in the 1990s and 2000s as the mayor of North Las Vegas, but today, he’s back in the real estate business — only with a little more responsibility than he had in his early career days.
Montandon is managing partner of real estate holdings firm Insight Investment Partners. The company’s $100 million portfolio includes the Mountain Falls golf course community in Pahrump, a 13.5-acre, Albertsons-anchored shopping center at 8410 Farm Road, and the 270-acre Buckeye 270 commercial park in Buckeye, Ariz.
Montandon also just began his one-year tenure as president of NAIOP Southern Nevada Chapter, a trade group of commercial real estate developers and brokers. He said he enjoys being back in the private sector, but he won’t rule out another run at public office in the distant future.
Question: What drew you to commercial real estate?
Answer: My father was a commercial real estate appraiser. We still joke about the fact that that was our every weekend. He’d say, “Let’s go for a drive.” For him, that meant, “Let’s go look at real estate.” We looked at everything from commercial properties to apartments — whatever he was analyzing. Today, my dad is 77. I went to visit him over the holidays. He said, “Got some time? Let’s go look at some real estate.” I kind of always assumed I’d have something to do with this industry.
Question: What has been the most interesting real estate-related job you’ve had?
Answer: My current one, as a principal, or owner. Any of the transaction-based aspects are exciting and fun — helping put the financing in place, helping build a project, handling brokerage or appraisals — but as an owner, you live through all of those processes and stay with the deal to live with your decision and your analysis.
Question: How has the market changed since you joined Insight in late 2012?
Answer: Interest rates have gone up about 100 basis points, or 1 percentage point. I wouldn’t say deals are any more picked over today than they were a year ago. There’s still a lot of competition for the good deals, so generally, there hasn’t been a lot of change over the last year. Cap rates (rates of return) and acquisition prices have been fairly stable. The only thing that has gone up is the cost of debt.
Question: Has it risen enough to change your decisions?
Answer: Not really. It was not unexpected and it’s risen very gradually.
Question: What do you hope to accomplish during your term as NAIOP president?
Answer: I’m focusing on a couple of primary things. NAIOP (the National Association of Industrial and Office Properties) has made some really great strides at being involved in the public-policy process. As government officials and economic-development agencies want to know what the commercial development industry thinks about an issue, they turn to NAIOP. I want the group to continue to be a great resource in that area.
Second, we’re really working hard on our Developing Leaders Institute. We all feel like it’s not a bad industry to be in. None of us would mind if our children got into this, and we need more mentors in the industry. So we worked pretty hard setting up a number of ways where new people in the industry can get involved and get some guidance from experienced people.
And then I just want to continue to make it a premier commercial real estate networking and business-opportunity venue.
Question: Your company is active in San Diego, Phoenix and Las Vegas. Where are we in our real estate recovery compared with those markets?
Answer: Behind both of them. Of course, that provides more opportunity here. San Diego didn’t get hit nearly as hard and didn’t recover nearly as hard either. It’s a very stable market. I’m primarily in the multifamily market there, and vacancy hasn’t dropped. It hasn’t been more than 4 percent to 5 percent in 30 years.
Phoenix is definitely in recovery mode, and there are some good, stable properties, but still some opportunities. Las Vegas has started its recovery, but it’s not rising as fast as Phoenix. That means there are some great opportunities to purchase here that you wouldn’t find there.
Question: What needs to happen to get us further along into recovery?
Answer: We have to be attractive to job creators. When you go down to Phoenix, look at the Chandler market, where a lot of high-tech industries are moving. Wells Fargo just expanded its operations pretty dramatically there, too. We want to make sure we don’t place ourselves in a noncompetitive position against them by raising fees or raising taxes, or doing other things where Wells Fargo puts it all on a spreadsheet and says, “This city is better than Las Vegas.” We want to give those businesses a reason to be here.
Question: You work with businesses in California and Arizona. What does Las Vegas need to do to attract more corporate relocations and expansions, or to compete for new business?
Answer: There’s no one factor. People don’t say, “Oh, look — real estate prices are better, or this tax is lower. Let’s move to Vegas.” The tax burden is really onerous in California, and companies are still there, because the market is there, the buyers are there, and they can generate enough business to where taxes are not unbearable.
But if they’re making a widget they can make or ship anywhere, they’re not going to be in California, so we have to be competitive with wherever else they’re looking, whether that’s Denver, Phoenix or Albuquerque. We need good transportation, we need good education, we need water and sewer systems that work, we need good electrical infrastructure, we need political stability. We need all of those things.
Question: You were North Las Vegas mayor for more than a decade. What was your favorite thing about public service?
Answer: Meeting with people, and seeing the effect of public policy on businesses, families and neighborhoods. We’d spend hours working on landscape setbacks and meeting with homeowners associations and people, working through issues and problems.
Question: Do you miss it?
Answer: Every day. People come up to me saying, “Aren’t you glad you’re out?” No. I miss it every day, just going 100 miles per hour and talking to so many people.
Question: Would you ever get back into public life?
Answer: Maybe. I’ll wait 10 years and answer that question. I want to spend a little more time on the private side. I just turned 50. I’ll decide when I’m 60. I really enjoy what I’m doing. I couldn’t ever be the president of NAIOP as an elected official. I like this involvement in the private sector.
Question: Your biggest career accomplishment?
Answer: Craig Ranch Park. It’s an asset that will be there for a lot of years. Watching thousands of people enjoy it every day is pretty thrilling. We used (Southern Nevada Public Land Management Act) funds to buy it and convert it from a golf course to a park. I didn’t do it by myself, but I did help get it started, and I’m pretty proud of that. We started working on that in about 2005, and it finally opened in 2012.
Question: What’s ahead for your career future?
Answer: My partner and I will continue to acquire and manage real estate for as long as we can, and for as long as the market will let us. I’m very fortunate — my partner has been doing this for 27 years. There’s no reason to think we can’t continue to do it for a long time.
Contact reporter Jennifer Robison at email@example.com. Follow @J_Robison1 on Twitter.