Retail real estate development looking up

Sales gains and new brands entering the Las Vegas market signal that the city's retail sector is gaining momentum.

Mark Mikelson said that as he meets with business partners at RECon 2012, he's noticed "positive energy and optimism" about Las Vegas. Mikelson is executive director and senior vice president of Nadel Nevada, a Las Vegas-based architecture and planning firm.

"I've seen and met with developers from outside of our area that are now, seemingly, very interested in investing in our community, which I find to be very, very exciting," Mikelson said. "Just a few years ago, when we would mention Las Vegas to real estate developers and retailers in particular, they didn't want to have anything to do with it."

Mikelson said developers and retailers once projected that Vegas wouldn't see much growth or new retail development for as long as a decade.

A first-quarter report from Colliers International showed Las Vegas with 12.2 percent vacancy for 44.2 million square feet of retail space for lease with nothing under construction. Net absorption, or the amount of space taken by retailers, was positive 163,597 square feet during the quarter.

"I definitely get the sense that although they may not be opening new stores immediately, they are now looking for those opportunities," Mikelson said.

Nadel has worked with developers Territory Inc. and Laurich Properties, and Chase Bank is one of the firm's major clients in Las Vegas. About 60 percent of Nadel's business is retail design.

RECon, the global retail real estate convention hosted by the International Council of Shopping Centers, wraps up today at the Las Vegas Convention Center. This year's show attracted about 31,000 shopping center professionals, about 1,000 more than in 2011.

One of the larger booths at the show belonged to General Growth Properties, which operates four Las Vegas malls: Fashion Show mall, Meadows mall, the Grand Canal Shoppes and the Shoppes at Palazzo. Laurie Paquette, vice president of asset management for the company, spoke about Fashion Show just as RECon was getting started.

"We continue to really explode in leasing and sales. Since 2009 we've continued to see great interest in the property," Paquette said.

Although she didn't release specific numbers, Paquette said sales and traffic are up by double-digit percentages over 2011, and consumers are spending more across the board. The retail center attracts 70 percent tourists and 30 percent locals. New mall tenants include Topshop, Robert Graham, a men's and women's sportswear designer; Hugo Boss; and Scotch and Soda, an Amsterdam-based fashion brand. During RECon, Fashion Show sees a 20 percent increase in traffic.

Russ Joyner, Russ president and general manager of the Miracle Mile Shops, and Maureen Crampton, director of mall marketing and business development for the Forum Shops at Caesars, said their outlets also experience a bump.

At RECon, Joyner is looking at a variety of retail categories that could fit into Miracle Mile, including food outlets and women's ready-to-wear. The center has seen steady sales increases, and continues to attract about 80,000 people, each with $300 to $500 to spent, on an average day.

"That's been our sustained number for some time now," Joyner said.

In September, Garrett Popcorn is set to open at Miracle Mile, following Blow-dry bar Dollheads in June and Gratiae, an organic skin care line, in November.

Like Miracle Mile, the Forum Shops also is faring well. Since the beginning of 2012, the mall has experienced double-digit percentage sales increases over last year.

"I think people are really coming around. The spend is up, the traffic is up and incoming visitors to Las Vegas is up," Crampton said.

Las Vegas Review-Journal writer Hubble Smith contributed to this report. Contact reporter Laura Carroll at lcarroll@reviewjournal.com
or 702-380-4588.