Industry furnishes hope

This boomtown was as sure a bet for furniture stores as any business three years ago. But when the Las Vegas housing bubble burst, local furniture sellers lost not just profits, but hope.

While profits may not be making a comeback just yet, some operators are daring to hope again.

The recent expansion of some furniture retailers and manufacturers is providing a much-needed confidence jolt to the battered industry. In August, Canadian company Foliot Furniture opened a major manufacturing plant in Las Vegas. Meanwhile, Ashley Furniture HomeStore surprised local retailers by announcing a new store as summer began and as another steep dip in furniture sales continued.

Levitz, Wickes, and numerous smaller furniture outlets like Kidz Bedz, have folded like couch beds. Ashley moved in over the summer at the site of the old Levitz location at 91 S. Martin Luther King Blvd. near Interstate 15.

Ashley saw an opportunity to position itself for a recovery.

“Our CEO (Michael Jedlowski) feels the Las Vegas economy will be turning around,” said Dan Sprengeler, Ashley’s local operations manager.

Sprengeler spends enough time at the newest Las Vegas Ashley store to share his boss’s optimism.

“We get quite a bit of traffic here every day,” Sprengeler said. “Walker Furniture is nearby, and I think we will be here for years to come.”

The former Levitz site is just down the street from local industry giant Walker Furniture. Ashley has also found a retail outlet within walking distance of the World Market Center, where the company has another showroom.

“If somebody (visiting) the World Market Center wants to open a retail store, they can come tour this location,” Sprengeler said.

The 108,000-square-foot Martin Luther King spot has a 64,000-square-foot showroom, keeping about 100 employees working. Jedlowski runs Ashley’s Glendale, Ariz.-based parent, Southwestern Furniture, and operates 17 stores, including three in Southern Nevada.

At the August opening, Jedlowski cited the strong performance of Ashley’s other two stores and a desire to be ready for the “awakening Las Vegas market economy.”

Furniture sales have been like a roller coaster ride. After a promising rebound early in the year, furniture buying reverted to recessionary lows after Memorial Day. That was especially troubling because Memorial Day and Labor Day are traditionally among the biggest days for furniture sales.

“What we saw early in the year was optimism,” World Market Center President and CEO Robert Maricich said. “That optimism has waned. We rely more now on hope than a resurgence in the economy.”

Continued struggles in home sales, and depreciation, have pressured the furniture industry, he said.

“What we see now is a muddling around the bottom, and it should be no surprise that this muddling mirrors the housing market,” Maricich said. “Like (in) Las Vegas, Scottsdale, (Ariz.,) Phoenix and parts of California.”

But Ashley’s gamble on Las Vegas seems to be paying off. Sprengeler said business at the new store is better than expected.

Operators of competitors Walker and FurnitureDirect are far from jealous. Instead, they praised any signs of life in the local furniture market.

“We like having Ashley there,” Walker Furniture President and CEO Larry Alterwitz said. “They are going to be advertising anyway and bringing people in. Why not have (it) right up the street from us?”

That “competition is good” adage can be true in the furniture business, in which buyers typically comparison shop to get the best price.

“People are going to say, ‘Let’s see what Walker has,’ ” Alterwitz predicted.

The location may be important for surrounding businesses, but what matters most to furniture sellers is that a major player like Ashley still believes in Las Vegas.  

“Ashley coming in the middle of a downturn and opening a store shocked a lot of people,” said Larry Smith, the Las Vegas FurnitureDirect franchise owner.

Smith knows how tough it is to sell furniture. Another local FurnitureDirect franchise opened a store around the time of the recession but closed soon after.

“Ashley has the capital and they can wait it out,” Smith said. “But it is more competition for local furniture retailers.”

Observers see Foliot Furniture’s expansion into Las Vegas this summer as another step toward making Southern Nevada a furniture destination.

Foliot manufactures furniture primarily for colleges and hotels. Las Vegas was a natural fit. And $297,551 in one-time tax abatements made the Quebec-based company pass over competing cities such as Phoenix and Los Angeles, said Ken Pierson, the Nevada Commission on Economic Development’s deputy director.

The manufacturer has created about 90 jobs so far, and plans to add 100 more workers over the next year.

Pierson believes the 300,000-square-foot Foliot plant’s presence in Southern Nevada, combined with the World Market Center, could create a furniture cluster of sorts. Other inquiries about moving to the valley, made by undisclosed furniture manufacturers, have also sparked renewed optimism.

“We are definitely hoping for that, and this can start it,” Pierson said of Foliot’s arrival. “It can be 18 months (of negotiations with a company). These things take time.”

Foliot has been holding its own, said Lenix Jorge, the company’s local human resources manager.

“The market we’re mostly in is residence halls for colleges,” he said. “That market has been pretty steady for us.”

Now in Las Vegas, Foliot is negotiating with local hotels and is trying to get UNLV’s business. About 20 percent of Foliot’s business comes from selling hospitality furniture.

Jorge sees Southern Nevada as a potential furniture hub.

“You have the World Market Center, and other furniture franchisees and showrooms,” he said. “I think Las Vegas is positioning itself to be a full-service-type deal.”

 Survivors in the local furniture industry sometimes benefit from attrition.

Roy Walsh, the sales manager at the valley’s lone Robb & Stucky location, said his upscale furniture store in Town Square has little competition.

“A lot of people have closed down,” he surmised after naming off a few former rivals. “It’s the proverbial last man standing.”  

Ethan Allen, one competitor, keeps a showroom at the World Market Center but has closed its other area retail locations.

Robb & Stucky has survived nearly three years in Southern Nevada partly because of orders from tourists. The visitors happen upon the Las Vegas Boulevard location and have furniture shipped home, he said. That amounts to about 25 percent of the store’s business.

Those retailers dependent solely on locals have their challenges. Walker’s business dropped more than 20 percent. About 20 percent of the staff, or around 40 people, had to be let go. Alterwitz said he probably waited “too long” to make the cuts in hopes of a recovery.

“It’s the name of the game, to become as lean and mean as you can,” he said. “When you become lean and mean it’s amazing how efficient you become and how much money you save.”

 Contact reporter Valerie Miller at 702-387-5286 or vmiller@lvbusinesspress.com.

ad-high_impact_4
Business
Opendoor isn't the typical house flipping company
Unlike most house flippers, the company aims to make money from transaction costs rather than from selling homes for more than their purchase price.
The Venetian gondoliers sing Italian songs
Gondolier Marciano sings a the classic Italian song "Volare" as he leads guests through the canals of The Venetian in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal)
Building In Logandale
Texas homebuilder D.R. Horton bought 43 lots in rural Logandale. (Eli Segall/Las Vegas Review-Journal)
Indoor farming in Southern Nevada
Experts discuss Nevada's indoor farming industry. (Bailey Schulz/Las Vegas Review-Journal)
Former Fontainebleau could have become a Waldorf Astoria
Months after developer Steve Witkoff bought the Fontainebleau last summer, he unveiled plans to turn the mothballed hotel into a Marriott-managed resort called The Drew. But if Richard “Boz” Bosworth’s plans didn’t fall through, the north Las Vegas Strip tower could have become a Waldorf Astoria with several floors of timeshare units. (Eli Segall/Las Vegas Review-Journal)
LVCVA CEO Rossi Ralenkotter announces plans to retire
Rossi Ralenkotter, CEO of the LVCVA, on Tuesday confirmed a Las Vegas Review-Journal report that he is preparing to retire. Richard N. Velotta/ Las Vegas Review-Journal
Cousins Maine Lobster to open inside 2 Las Vegas Smith’s stores
Cousins Maine Lobster food truck company will open inside Las Vegas’ two newest Smith’s at Skye Canyon Park Drive and U.S. Highway 95, and at Warm Springs Road and Durango Drive. Cousins currently sells outside some Las Vegas Smith’s stores and at Fremont Street and Las Vegas Boulevard. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas home prices to continue to rise, expert says
Lawrence Yun, chief economist at the National Association of Realtors, gives homebuyers a pulse on the Las Vegas housing market. (Eli Segall/Las Vegas Review-Journal)
NV Energy announces clean energy investment
The company is planning to add six solar projects in Nevada, along with the state's first major battery energy storage capacity. Bailey Schulz/Las Vegas Review-Journal
3 Mario Batali restaurants on Las Vegas Strip to close
Days after new sexual misconduct allegations were made against celebrity chef Mario Batali, his company announced Friday that it will close its three Las Vegas restaurants July 27. Employees of Carnevino Italian Steakhouse, B&B Ristorante and Otto Enoteca e Pizzeria, all located in The Venetian and Palazzo resorts, were informed of the decision Friday morning. Bastianich is scheduled to visit the restaurants Friday to speak to employees about the next two months of operation as well as how the company plans to help them transition to new positions.
Nevada has its first cybersecurity apprenticeship program
The Learning Center education company in Las Vegas has launched the first apprenticeship program for cybersecurity in Nevada. It was approved by the State Apprenticeship Council on May 15. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas union members voting to authorize the right to strike
Thousands of Las Vegas union members voting Tuesday morning to authorize the right to strike. A “yes” vote would give the union negotiating committee the power to call a strike anytime after June 1 at the resorts that fail to reach an agreement. (Todd Prince/Las Vegas Review-Journal)
Small businesses struggle to find qualified candidates
A 2018 survey found that over two-thirds of small businesses in Nevada find it somewhat to very difficult to recruit qualified candidates. Bailey Schulz/Las Vegas Review-Journal
Nevada secretary of state website offers little protection against fraudulent business filings
Property developer Andy Pham tells how control of his business was easily seized by another person using the secretary of state website.
Caesars may be going solo in its marijuana policy
Several Southern Nevada casino companies aren’t following Caesars Entertainment’s lead on marijuana testing.
How much is the Lucky Dragon worth?
Less than a year-and-a-half after it opened, the Lucky Dragon was in bankruptcy.
Gyms and discount stores take over empty retail spaces
Grocery stores used to draw people to shopping centers. But many large retail spaces have been vacant since 2008. Discount stores like goodwill and gyms like EOS Fitness are filling those empty spaces, and helping to draw shoppers back in. K.M. Cannon/Las Vegas Review-Journal
Funding source of Las Vegas stadium for the Raiders is sound, expert says
The stadium is funded in part by $750 million of room taxes, the biggest such tax subsidy ever for a professional sports stadium. Robert Lang, executive director of Brookings Mountain West and The Lincy Institute at UNLV, says that is a good use of public funds. (Richard Velotta/Las Vegas Review-Journal)
Las Vegas needs light rail, expert says
Robert Lang, executive director of Brookings Mountain West and the Lincy Institute said he is afraid of a "congestion mobility crisis." Las Vegas needs a light rail system, he said, to accommodate the city's growing number of attractions. (Richard Velotta/Las Vegas Review-Journal)
Three takeaways from Wynn Resorts' Earnings Call
Matt Maddox came out swinging in his first earnings conference call as Wynn Resorts chief executive officer, boasting of record Las Vegas quarterly revenues and applicants lining up for work.
Star Wars VR Comes to Las Vegas
Sneak peak at the new "Star Wars: Secrets of the Empire" VR experience at the Grand Canal Shoppes.
Elaine Wynn continues her fight to change Wynn Resorts board
Elaine Wynn, the largest shareholder of Wynn Resorts Ltd., is seeking to kick a friend of her ex-husband Steve Wynn off the company’s board of directors. (Todd Prince/Las Vegas Review-Journal)
Zillow is getting into house flipping in Las Vegas
Las Vegas Review-Journal real estate reporter Eli Segall says flipping houses has waned in popularity after the housing bubble burst.
Ellis Island Buys Mt. Charleston Lodge
Ellis Island, which operates a casino, brewery and hotel just off the Strip, purchased the Mt. Charleston Lodge in early April.
Casinos to be penalized for allowing drug-impaired customers to gamble
Nevada Gaming Commission Chairman Tony Alamo talks about an amendment making casinos subject to the same disciplinary standards of preventing people to gamble if impaired by drugs as they are for letting them play while intoxicated by alcohol.
Terrible Herbst to open large travel center in Southern Nevada
The 50,000-square-foot commercial travel center will include 96 fuel pumps and the third White Castle restaurant in Southern Nevada. Wade Tyler Millward reports.
Art Bell’s Top 10 Shows
A selection of radio host Art Bell’s most popular shows.
Hooters owner talks about room upgrades at his hotel-casino
George Ruff, founder and senior principal of Trinity Hotel Investors L.L.C., owner of Hooters Hotel and Casino in Las Vegas, talks about recent room upgrades at the hotel. K.M. Cannon/Las Vegas Review-Journal
Passengers Discuss Allegiant Air
Allegiant Air passengers voice their views on the airline at McCarran International Airport on April 16, 2018. (Bailey Schulz/Las Vegas Review-Journal)
Longtime Las Vegas attorney John Momot dies at age 74
Criminal defense attorney John Momot, who represented mob figures and even played himself in the movie “Casino,” has died.
TOP NEWS
News Headlines
Home Front Page Footer Listing
Circular
You May Like

You May Like