Nongaming hotel planned west of Vegas Strip on site sold at discount from boom years

With plans for private butlers, poolside villas and a nightclub called The Whale Club, condo tower Vegas 888 promised the flash and opulence of a high-roller lifestyle.

But like countless other plans from the bubble era, the project flopped – and now, the vacant site has sold at a steep discount from the boom years.

Las Vegas investor Christopher Beavor on Friday bought the property, at the southwest corner of Flamingo Road and Valley View Boulevard, for $13.5 million, Clark County records show. The 8.6-acre parcel is next to the Palms and across from the Gold Coast.

The fenced-off site can be easy to ignore when driving past it. But its history all but epitomizes the real estate craze and crash of last decade – a Florida developer, with funding from Lehman Brothers, set out to build a luxury Las Vegas high-rise and lost the land to foreclosure.

Beavor, managing partner of CAI Investments, said he hasn’t finalized his plans. But he’s considering developing retail space, a five-story apartment complex with about 280 units, and, “unless somebody writes me some silly offer tomorrow,” a nongaming hotel with maybe 200 to 225 rooms.

He aims to start construction in six to seven months, he said.

CBRE Group brokers had been trying to sell the site, a mile west of the Strip, for more than a year. Listing broker Michael Parks said the seller, the remains of former powerhouse investment firm Lehman Brothers, fetched the “highest price” possible but previously wanted more than what buyers would pay.

He said apartment developers showed interest in the site – that sector is among the busiest in Southern Nevada commercial real estate, with rising rents, shrinking vacancies and a burst of construction, mostly in the suburbs.

As far as he knew, the Flamingo parcel was Lehman’s last remaining asset in Nevada, but it wasn’t “a fire sale.” Apartment developers who eyed the property wouldn’t pay a high-enough price for Lehman, according to Parks.

Lehman Brothers Holdings spokeswoman Kim Macleod declined comment on the sale.

No one is building condo towers in Las Vegas today, but last decade, with easy credit sloshing around for homebuyers and developers alike, investors drew up plans for dozens. Supporters dubbed the high-rise boom the “Manhattanization” of Las Vegas.

Christopher DelGuidice was one of many developers who got in on the go-go years.

The founder of Orlando, Florida-based Del American Real Estate Group, DelGuidice developed Vegas Grand, a luxury residential project east of the Strip on Flamingo, with Lehman financing. After he launched that project, his company announced plans in 2005 for Vegas 888, a 50-story luxury condo tower.

He bought the Vegas 888 site for $50 million in 2004, backed by a loan of up to $79.45 million from Lehman, county records show.

According to the 2005 announcement, the planned amenities included a 12,000-square-foot spa; private butlers, housekeepers and other staff “whose sole mission is to anticipate and fulfill every desire of each resident”; and The Whale Club, an “exclusive” nightclub with views of the Strip.

By 2006, however, far more condo towers had been announced than built in Las Vegas, and cancellations and litigation were mounting. Del American unveiled a change in plans that year, saying the “best use” for the Vegas 888 site was a luxury casino-resort.

The property, however, was seized through foreclosure in 2007, county records show, and New York-based Lehman went bankrupt in 2008, helping trigger the U.S. financial crisis.

In a phone interview Tuesday, the 59-year-old DelGuidice said he pre-sold about $250 million worth of condos at Vegas 888. But planned high-rises were being scrapped amid rising construction costs, he said, and prospective buyers eventually stayed away because they didn’t know if projects would get built.

He said his group spent about $75 million on Vegas 888. He declined to say how much he lost on the project but said most of the money spent came from Lehman.

“That would have been the hottest building ever,” DelGuidice said.

He also said he looked into buying the site back a year or so ago to develop apartments, but it was priced at $20 million, and rental rates weren’t high enough to make a project there work.

He still visits Las Vegas. But given what happened to his boom-era projects here – Vegas Grand was hit with litigation after DelGuidice raised the sales prices, news reports said, and this week he called that project a “big calamity” – at least one thing seems certain.

“I’d never do condos again in Vegas,” he said. “After you get wiped out, even if the market was good, let someone else do ‘em.”

Contact Review-Journal writer Eli Segall at (702) 383-0342 and on Twitter at @eli_segall.

ad-high_impact_4
Business
Bellagio, MGM Resorts International’s luxury hotel turns 20
The more than 3,000-room Bellagio hotel is situated on the site of the former Dunes Hotel. The Dunes was imploded in 1993, and construction of the Bellagio started in 1996. It cost $1.6 billion to build, making it the most expensive hotel in the world at the time. The Bellagio was former Wynn Resorts Ltd. Chairman and CEO Steve Wynn’s second major casino on the Strip after The Mirage. MGM Resorts International acquired the property from Steve Wynn in 2000. (Tara Mack/Las Vegas Review-Journal)
Facial recognition software at G2E – Todd Prince
Shing Tao, CEO of Las Vegas-based Remark Holdings, talks about his facial recognition product. (Todd Prince/Las Vegas Review-Journal)
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant
Former NBA player, Shaquille O'Neal, speaks about his new Las Vegas chicken restaurant. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye
Bobby Baldwin to leave MGM
MGM Resorts International executive and professional poker player Bobby Baldwin is set to leave MGM.
Caesars has new armed emergency response teams
Caesars Entertainment Corp. has created armed emergency response teams. They are composed of former military and law enforcement officials. "These teams provide valuable additional security capabilities,” Caesars spokeswoman Jennifer Forkish said. Caesars is hiring Security Saturation Team supervisors, managers and officers, according to LinkedIn. The company did not say how many people it plans to hire for the units. (Las Vegas Review-Journal)
Las Vegas, airlines prepare for CES
CES in January is expected to attract more than 180,000 attendees. (Las Vegas Review-Journal)
AGS partners with Vegas Golden Knights
AGS is the nation’s second-largest manufacturer of Class II slot machines used primarily in tribal jurisdictions. It announced a marketing partnership with the Vegas Golden Knights NHL team. (Las Vegas Review-Journal)
Lehman Brothers bet big on Las Vegas
Lehman Brothers collapsed 10 years ago, helping send the country into the Great Recession.
Fremont9 opens downtown
Fremont9 apartment complex has opened in downtown Las Vegas. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Ross & Snow launches in Las Vegas
Luxury shoe brand Ross & Snow has opened in Las Vegas, featuring "functional luxury" with premium shearling footwear. (Bailey Schulz/Las Vegas Review-Journal)
Remote Identification and Drones
DJI vice president of policy and public affairs discusses using remote identification on drones. (Bailey Schulz/Las Vegas Review-Journal)
Drones and public safety in Nevada
Two representatives in the drone industry discuss UAV's impact on public safety. (Bailey Schulz/Las Vegas Review-Journal)
Frontier Airlines to launch flights from Las Vegas to Mexico
Frontier, a Denver-based ultra-low-cost carrier, will become the first airline in more than a decade to offer international service to Canada and Mexico from Las Vegas when flights to Cancun and Los Cabos begin Dec. 15. (Rick Velotta/Las Vegas Review-Journal)
MGM Resorts International CEO Jim Murren addresses Oct. 1 lawsuits
MGM Resorts International Chairman and CEO Jim Murren addresses criticism his company has received for filing a lawsuit against the survivors of the Oct. 1 shooting. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International opens the doors on MGM Springfield
Massachusetts’ first hotel-casino opens in downtown Springfield. The $960 million MGM Springfield has 252 rooms and 125,000-square-feet of casino. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International prepares to open MGM Springfield
Las Vegas-based MGM Resorts International gave news media and invited guests a preview of the $960 million MGM Springfield casino in Massachusetts. The commonwealth's first resort casino will open Friday, Aug. 24. (K.M. Cannon/Las Vegas Review-Journal)
A Walk Through Circus Circus
It only takes a short walk through Circus Circus to realize it attracts a demographic like no other casino on the Strip: families with young children. (Todd Prince/Las Vegas Review-Journal)
Morphy Auctions, a vintage slot machines seller, wants gaming license
Vice president Don Grimmer talks about Morphy Auctions at the company's warehouse located at 4520 Arville Street in Las Vegas on Thursday, Aug. 16, 2018. (Rick Velotta/Las Vegas Review-Journal)
Nevada's venture capital money doesn't stay in state
Zach Miles, associate vice president for economic development for UNLV, said there’s venture money in Southern Nevada, “but trying to find the right groups to tap into for that money is different.” According to a 2017 report from the Kauffman Foundation, Las Vegas ranked number 34 out of 40 metropolitan areas for growth entrepreneurship, a metric of how much startups grow. With a lack of growing startups in Las Vegas, investment money is being sent outside of state borders. The southwest region of the U.S. received $386 million in funding in the second quarter, with about $25.2 million in Nevada. The San Francisco area alone received about $5.6 billion. (source: CB Insights)
Neon wraps can light up the night for advertising
Vinyl wrap company 5150 Wraps talks about neon wraps, a new technology that the company believes can boost advertising at night. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Nevada on the forefront of drone safety
Dr. Chris Walach, senior director of Nevada Institute for Autonomous Systems, talks to a reporter at NIAS's new Nevada Drone Center for Excellence of Public Safety, located inside the Switch Innevation Center in Las Vegas. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
Motel 8 on south Strip will become site of hotel-casino
Israeli hoteliers Asher Gabay and Benny Zerah bought Motel 8 on the south Strip for $7.4 million, records show. They plan to bulldoze the property and build a hotel-casino. Motel 8 was built in the 1960s and used to be one of several roadside inns on what's now the south Strip. But it looks out of place today, dwarfed by the towering Mandalay Bay right across the street.
TOP NEWS
News Headlines
Add Event
Home Front Page Footer Listing
Circular
You May Like

You May Like