The Siegel Group Nevada Inc. recently acquired an apartment complex after the Las Vegas Convention and Visitors Authority elected not to close on the purchase.
The property, Sierra Vista Square Apartments, was offered for sale by a loan servicer through an online auction at Auction.com. Siegel Group, a real estate and management company, was the winning bidder with an all-cash purchase price of $4.65 million.
Built in 1980, the 175-unit traditional apartment complex is at 920 Sierra Vista Drive on about 3.36 acres and surrounded by property owned by the Las Vegas Convention Center.
Sierra Vista Square Apartments was 94 percent occupied at closing. Some residents were anticipating displacement if the convention authority went ahead with the purchase. But the Siegel Group plans to continue operating the property as a traditional apartment complex for the near term.
In an emailed statement, Luke Puschnig, legal counsel for the Las Vegas Convention and Visitors Authority, said the convention authority didn’t complete the deal because it no longer made financial sense.
“The seller changed the terms of the deal we had initially agreed upon, and with those changes it no longer made sense for us to pursue the property. The most significant change related to the timeframe for escrow and closing. The impacts that came with that change among others made it no longer viable for us. Our land acquisition strategy is to make sure the purchases are both appropriate and financially responsible,” he said in an email to the Las Vegas Review-Journal. He estimated the costs for not completing the sale at about $1,000.
The convention authority is acquiring properties in the area for the Las Vegas Global Business District. The Global Business District involves major renovations of the Las Vegas Convention Center, expanding the World Trade Center designation and developing a transportation hub, according to the World Trade Centers Association website. Since 2013, the convention authority has acquired 18.73 acres at a cost of about $49 million, Puschnig said in the email. He said there were two other planned purchases that the convention authority did not pursue because “they no longer made business sense for us.”
For The Siegel Group, it was the eighth commercial property acquired in 2014. Other transactions include multi-family, extended-stay, mixed-use and retail in Las Vegas and Reno.
Stephen Siegel, CEO of the Siegel Group Nevada, said he plans to continue to acquire more properties. Siegel Group currently has 27 Siegel Suite properties and close to 90 total properties.
“We’re looking for residential properties that are mismanaged, that have upside, that have a great location,” he said.
He said he sees several property opportunities in Reno, noting that there’s considerable real estate conversion going on. He said gaming is being emphasized less, and there is a shortage of housing and many buildings are being converted to residential.
“You have Tesla and Panasonic people,” he said, referring the planned Tesla Gigafactory in Storey County. “Our short-term strategy is to continue to invest in Las Vegas and Reno,” he said. “All of the tech stuff will change downtown Reno.”
Siegel said he anticipated more growth for his company, which employs about 1,500 people.
“We’re continuing to grow the business,” he said. “We were creating jobs all through the downturn. We were hiring through the downturn.”
Contact Review-Journal writer Daniel Behringer at email@example.com. Find him on Twitter: @DanBehringer221