74°F
weather icon Partly Cloudy

Investors buying Town Square south of Las Vegas Strip, sources say

Town Square is a popular place to shop, eat and get drinks, having overcome a string of litigation and financial woes after the economy crashed.

Now, investors are ready to bet that its future can only get brighter.

New York investment giant TIAA and Chicago-based Fairbourne Properties are buying the foreclosed, roughly 100-acre commercial property south of the Strip, people familiar with the matter told the Review-Journal this week.

One source said the buyers were reportedly trying to close the sale by year’s end, though another said they were rumored to be aiming for mid- to late-January.

None knew the sales price. But sources said the buyers would not get full ownership of the 1.2 million-square-foot center: original developer Turnberry Associates still holds about 120,000 square feet of offices, which aren’t part of the deal.

Fairbourne co-founder and President David Harvey confirmed the pending sale but otherwise declined comment.

“Nothing to report at the moment,” TIAA spokeswoman Daisy Okas said in an email, “but I’ll be in touch in the new year if we have news.”

Jaime Mapes, marketing director for Town Square, also declined to discuss the deal.

“Because the property is under contract, we can’t make any comments,” he said.

Efforts to reach a Turnberry representative were unsuccessful.

Town Square has no shortage of foot traffic or retailers. But the sale would mark a fresh start of sorts for the mixed-use property, which has been lender-owned since the recession and, like countless other boom-era projects in Las Vegas, was marred by lawsuits and foreclosure proceedings after the economy tanked.

Moreover, it wasn’t the only open-air “lifestyle” project in the valley that the recession derailed in some way.

Located on Las Vegas Boulevard South at Sunset Road, near the Interstate 15-215 Beltway interchange, Town Square offers clothing, jewelry and electronics shops, as well as restaurants, bars, a Whole Foods Market and an 18-screen AMC movie theater.

TIAA, founded in 1918 as a pension fund for college professors, now manages $889 billion in assets. It’s no stranger to Las Vegas, either.

In 2013, it acquired a 49.9 percent stake in the Grand Canal Shoppes from owner General Growth Properties for $411.5 million in cash. In July, it also bought a 50 percent stake in Fashion Show mall from General Growth for $1.25 billion.

Fairbourne, meanwhile, is a new group whose founders were sued this year by their former employer.

According to a report by Crain’s Chicago Business, real estate investment firm M&J Wilkow sued four former executives in late April, alleging the group secretly formed a competing venture that “has drained” about $20 million in revenue from their old firm.

The group, which included Harvey, was accused of creating “the impression that Wilkow was in turmoil” and then offering their new investment and property-management business “as a ‘white knight’ to longtime Wilkow investment partners,” the magazine reported.

A call to Chicago-based M&J Wilkow seeking an update on the case was not returned.

Town Square, developed by Las Vegas-based Centra Properties and Florida’s Turnberry, was built during the boom years and opened in November 2007 as the economy was softening. In mid-2010 — after the real estate bubble had burst and the economy had crashed — the property was hit with a default notice, court records show.

Town Square’s developers, having taken out a $470 million construction loan, sued in early 2011, claiming a breach of their agreement with lenders to keep ownership of the property.

The center, however, was seized through foreclosure a week after the lawsuit was filed.

Turnberry’s owners, siblings Jackie Soffer and Jeffrey Soffer, later sued one of the debt-holders, Five Mile Capital Partners. They claimed in the 2012 case that Five Mile managing directors James Glasgow and David Lattimer were “scheming to steal Town Square” and that their firm “sought to oust the Soffers.”

The month before the foreclosure, Five Mile bought $117 million worth of debt on the property. That purchase, combined with sales to “two other vulturesque hedge funds, Oak Tree (sic) Capital and CenterBridge (sic) Partners,” meant that hedge-fund operators controlled more than $200 million of Town Square’s debt, the lawsuit claimed.

Cleveland-based Forest City, which developed Las Vegas City Hall and co-owns the Galleria at Sunset mall in Henderson, manages Town Square.

Forest City spokesman Jeff Linton said “we are the wrong people to comment on a sale” because the company doesn’t own the complex.

Property records indicate that Town Square’s ownership group includes New York’s Centerbridge Partners; Stamford, Connecticut-based Five Mile Capital Partners; and Los Angeles-based Oaktree Capital Management.

Oaktree declined to comment on the sale. Neither Centerbridge nor Five Mile responded to requests for comment.

The real estate crash derailed projects throughout Southern Nevada, and urban-style properties in the suburbs that offer shopping, dining and office space were no exception.

The 106-acre Downtown Summerlin, at Sahara Avenue and the 215 Beltway, opened in fall 2014 after sitting for years as an abandoned, partially built steel skeleton.

The District at Green Valley Ranch, located on Green Valley Parkway just south of the Beltway in Henderson, was seized through foreclosure in 2011. Lenders sold the property that year for $79 million to two companies, and one bought out the other for $120 million last year.

Tivoli Village, a Mediterranean-themed complex at Rampart Boulevard and Alta Drive, was supposed to open in 2009. But its developers — after they considered mothballing the project — decided to build in phases instead.

The first portion opened in 2011, during the recession. The second phase, which management at one point said was expected to be completed in late 2013, debuted almost two months ago.

Contact Review-Journal writer Eli Segall at 702-383-0342 or esegall@reviewjournal.com. On Twitter at @eli_segall.

Don't miss the big stories. Like us on Facebook.
Business Videos
How much do Las Vegas casino CEOs make?
Las Vegas gaming CEOs made anywhere between $1 million and $24 million last year, according to company filings with the U.S. Securities and Exchange Commission. ((Las Vegas Review-Journal)
30-year-old Rio needs a little TLC
Nearly 30 years after the Rio opened, the red and blue jewel that helped catapult Las Vegas to a new level with its buffet and nightclub has lost its status along with its shine.
The latest on the Drew Las Vegas - VIDEO
Eli Segall recounts his tour of the Drew Las Vegas, formerly the Fontainebleau, on the Las Vegas Strip. (Michael Quine/Las Vegas Review-Journal)
Pinball Hall of Fame to move near south Strip
Operators of the Pinball Hall of Fame have been approved to build a new, larger arcade near the south edge of the Strip on Las Vegas Boulevard near Russel Road. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
National Hardware Show underway Las Vegas
The National Hardware Show kicked off Tuesday at the Las Vegas Convention Center (Mat Luschek / Review-Journal)
Caesars for sale?
Caesars Entertainment Corp. has been swept up in takeover speculation since the company’s share price tumbled last year amid disappointing earnings and concerns over a recession. Amid the decline, hedge funds scooped up shares. Billionaire activist investor Carl Icahn began buying shares of Caesars as early as January. Icahn acquired nearly 18 percent by mid-March. In February Icahn called on the Caesars board to study a sale as a way to boost shareholder value.
Las Vegas home prices
Las Vegas home prices grew fastest among major markets in February for the ninth straight month. But amid affordability concerns, the growth rate has slowed down. Southern Nevada prices in February were up 9.7% from a year earlier, according to the latest S&P CoreLogic Case-Shiller index. The last time Las Vegas' price growth fell below 10% was in September 2017, S&P Dow Jones Indices reported.
Free Parking Coming To Wynn
Free parking will come to the Wynn and Encore resorts on May 1, 2019. (Mat Luschek / Review-Journal)
Founding Venetian employees talk about 20 years at the Strip resort
The Venetian, which opened May 3, 1999, is celebrating 20 years on the Las Vegas Strip. Seven original employees talk about opening the luxury resort and working there for two decades. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Circa aiming for December 2020 opening
The 1.25-million-square-foot property will have 44-stories and 777-rooms. It will also have a separate nine-story, 1,201-space parking garage.
Boxabl official explains the building concept
Boxabl business development manager Galiano Tiramani shows off a room built by his company. (Blake Apgar/Las Vegas Review-Journal)
TI/Mirage Tram reopens
The tram that shuttles guests between TI and Mirage reopened this week after being closed for much of 2018.
Las Vegas Convention Center expansion taking shape
Renderings and actual footage show how the Las Vegas Convention Center is evolving.
Former Starbucks CEO Howard Schultz at Las Vegas convention
Former Starbucks CEO and potential presidential candidate Howard Schultz spoke at the Epicor Insights user conference at Mandalay Bay Convention Center Wednesday, April 17, 2019. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Drew Las Vegas to open in the second quarter of 2022
The 67-story Drew Las Vegas is slated to open in the second quarter of 2022 at the north end of the Las Vegas Strip. (Michael Quine/Las Vegas Review-Journal)
NAB Day 1 (Time Lapse)
NAB kicked off at the Las Vegas Convention Center on Monday, April 8, 2019. (Mat Luschek / Review-Journal)
National Association of Broadcasters Show shows 1mm thick 8K TV with 22.2 channel digital sound
Japan’s NHK Science & Technology Research Laboratories booth featured a 1mm thick 8K TV system used in conjunction with a 22.2 channel digital sound system at the National Association of Broadcasters Show at the Las Vegas Convention Center. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Nevada shoppers react to Smith’s no longer accepting Visa credit cards
On March 1, Smith’s announced that it would no longer be accepting Visa credit cards at any of its 142 supermarkets, including the 45 in Nevada.
Massachusetts Gaming Commission asks how long Wynn executives knew about misconduct
Business reporter Rick Velotta gives an update on the adjudicatory hearing on the suitability of Wynn Resorts to retain its gaming license in Massachusetts.
Henderson app developer part of Startup in Residence
Henderson based developers of the app On Point Barricade are taking part in Startup in Residence, a North America program dedicated to pairing tech companies with governments. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Sam's Town employees and customers talk of their love for the iconic casino
Longtime Sam's Town employees and customers love each other and love their casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Las Vegas apartments rents
Las Vegas’ apartment market has accelerated in recent years. Developers are packing the suburbs with projects, landlords are on a buying spree, and tenants have filled buildings.
William Boyd talks about the birth of Sam's Town
On the eve of the 40th anniversary of Sam's Town, William Boyd, executive chairman of Boyd Gaming and son of hotel namesake Sam Boyd, talks about how the casino became one of the first local properties in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
High Roller observation wheel turns five
The world’s tallest observation wheel celebrates it’s fifth year on Sunday, March 31, 2019. (Michael Quine/Las Vegas Review-Journal) @Vegas88s
Escape Room Industry Growing In Las Vegas
Escapology employees discuss the growing escape room industry in the U.S. and Las Vegas. (Bailey Schulz/Las Vegas Review-Journal)
Impact of parking fees on visiting the Las Vegas Strip
There are no data showing a relationship between Strip resort and parking fees and the number of out-of-state visitors to Las Vegas. But there are data showing a relationship between Strip parking fees and the number of local visitors to the the Strip. ‘’As a local, I find myself picking hotels I visit for dinner or entertainment, based on whether they charge for parking or not,”’ said David Perisset, the owner of Exotics Racing. ‘’It is not a matter of money, more of principle.’’ A 2018 survey by the Las Vegas Global Economic Alliance found 36.9 percent of Clark County residents reported avoiding parking at Strip casinos that charge for parking. 29.1 percent reported avoiding using any services from a Strip casino that charges for parking.
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Faraday puts Las Vegas land on the market
Nearly two years after Faraday Future bailed on its North Las Vegas auto factory, the company has put its land up for sale. (Michael Quine/Las Vegas Review-Journal)
El Cortez owner Kenny Epstein on running the iconic property
Kenny Epstein, owner of the El Cortez Hotel in downtown Las Vegas, talks about Jackie Gaughan mentorship and answers rumors about bodies in the basement at the mob-era casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
LVCVA recommends construction of underground people mover
The Las Vegas Convention and Visitors Authority announced the recommendation for an underground people mover for the convention center. The system would have the potential to expand and connect Downtown and the resort corridor all the way to McCarran. (Michael Quine/ Las Vegas Review-Journal)
THE LATEST
More companies handing over tech for China access, report says

The number of foreign companies that feel compelled to hand over technology in exchange for Chinese market access — an issue that sparked President Trump’s tariff fight — has doubled since two years ago, says a report.

Lucky Dragon’s foreign investors demand refund

The Lucky Dragon’s developers and prior management are facing lawsuits from Chinese investors, the project’s main lender and a Canadian high-roller who paid a $400,000 deposit to lease the casino just one month before it abruptly closed.