Tuesday, January 18, 2005
Copyright © Las Vegas Review-Journal

A LEGACY THAT'S STILL FLYING HIGH

Summerlin stands as example of aviator's risk taking

Howard Hughes Corp. Executive Vice President Kevin Orrock poses Jan. 6 at his Summerlin office with a portrait of Hughes. "The Aviator," a movie about Hughes' life, is now in movie theaters. Photo by K.M. Cannon.

Howard Hughes' intense drive for perfection is portrayed in "The Aviator," a movie about the billionaire's obsession with flying and speed.

What's missing from the three-hour movie, which garnered a Golden Globe award for actor Leonardo DiCaprio Sunday night, is the legacy Hughes left in Las Vegas.

In 1952, Hughes acquired 25,000 acres of barren desert in the western rim of the Las Vegas Valley, 12 miles from the Strip. He had ideas of building an aviation research center there.

The vast Hughes empire was passed on to his heirs upon his death in 1976, and the Las Vegas land was developed into Summerlin, a master-planned community named for Hughes' paternal grandmother.

It changed the way people looked at Las Vegas and set the standard for residential development here, said Kevin Orrock, executive vice president and treasurer of The Howard Hughes Corp.

"I think Hughes would have been happy with what we did with the land," Orrock said.

Orrock doesn't know how much Hughes paid for the land, but he does know people who bought five acres for about $100 in the 1950s outside of Summerlin, closer to town.

Orrock was hired as an accountant at Desert Inn hotel in 1974 when it was owned by Hughes and has held various financial positions throughout most of his 30 years with the Hughes organization.

"If you look at Hughes -- having never met him, but from a lot of what I read and the people I've been around -- if you look at the individual, he was a visionary and he was a risk-taker," Orrock said.

A good example of that is the $25 million to $30 million Hughes Corp. spent to build three miles of Summerlin Parkway from Rainbow Boulevard to Town Center Drive.

Initial funding for Summerlin Parkway, along with other utilities and roads, came from a Special Improvement District created through bonds issued by the city of Las Vegas. At $74 million, it was the largest developer-driven Special Improvement District in Nevada's history.

"That was a risk," Orrock said. "In 1989, it was 22,000 acres of desert. There was nothing here. That gets back to his vision and risk. People just see the end result. We could have built that road and nobody showed up."

They came. Summerlin is home to 90,000 residents and it's only about two-thirds developed. It has more than 36,000 homes, 19 schools, 14 churches and 3 million square feet of commercial development.

Financially and socially, Summerlin is in a "league of its own," Orrock said.

The community produced its first positive cash flow in 1993, two years after the first family moved in, and has been making money since.

It has ranked as the top-selling master-planned community in the nation for a decade and was honored by the Urban Land Institute in 2002 for its excellence in development.

"Like Hughes himself, Summerlin is larger than life and has succeeded way beyond expectations," Orrock said.

Hughes is also credited with the advent of corporate casino ownership in Las Vegas, bringing an end to the mob era.

He was the first owner of multiple casino properties on the Strip, including the Desert Inn, Landmark, Sands, Frontier, Castaways and Silver Slipper.

"I think the Las Vegas community has changed dramatically in my 30 years here," Orrock said. "It's still a small community, but when I came here, there were 300,000 people and 40,000 hotel rooms. Now it's 1.6 million, 1.7 million people and 130,000 rooms. It's become a world-class city. That's the dynamics of what's happened here. It's on everybody's radar screen. You can see that from the development side."

Orrock said Summa Corp., predecessor of Hughes Corp., was among only three major developers in Las Vegas. The others were American Nevada Co. and Thomas & Mack Development Group.

Summa developed the 120-acre Hughes Center with its landmark First Interstate (now Wells Fargo) bank tower and the 390-acre Hughes Airport Center in 1985.

Now there's the Related Cos., Rouse Co. and General Growth Properties.

"It used to be where someone may have done a transaction here. Now they're coming in and making a significant investment in the community, creating jobs," he said. "Vegas has had to fight perceptions forever and that's starting to change. People came here kicking and screaming because they had heard horror stories and now they don't want to leave."

Hughes Corp. was acquired in 1996 by Rouse of Columbia, Md., in a transaction valued at $520 million. Last year, General Growth Properties, owners of the Meadows and Boulevard malls in Las Vegas, acquired Rouse.

One constant that's remained through the acquisitions is the Hughes name.

"General Growth understands Hughes' brand here in Las Vegas is a very powerful brand," Orrock said. "Branding means a lot in this community and the legacy of Hughes is very important and very well thought of."