Turnberry’s tale adding stories

When Florida-based Turnberry Associates decided to build four high-rise luxury condominium towers on the north end of the Strip, everyone said they were on the wrong side of town.

"They said we should build next to Caesars Palace," Turnberry President Bruce Weiner said during a recent visit to Las Vegas. "We thought it was right for residential and we knew we weren't going to build a one-off (single tower). We're going to build the enclave we're known for."

Turnberry blazed the trail for luxury condominium development in Las Vegas nearly 10 years ago with Turnberry Place, a $650 million project on Paradise Road. It has 720 units in four 38-story towers.

In a joint venture with MGM Mirage, Turnberry also built The Residences at MGM, three 40-story condo-hotel towers with 1,700 units on the site of the former MGM Grand Adventure Theme Park.

The company has almost finished Turnberry Towers, two 45-story towers on Karen Avenue. Home Builders Research reported 45 closings at Turnberry Towers in July at an average price of $623,555.

"Turnberry is one of the pioneers in the high-rise business in Las Vegas," Home Builders Research president Dennis Smith said. "From that perspective, you have to give them respect for knowing their product niche because they've been here since the start."

Turnberry's largest project is now the $2.9 billion Fontainebleau casino-condo-hotel project under construction on the north Strip. Turnberry paid $45 million for the 21-acre El Rancho site and $95 million for the 3-acre Algiers motel site where the canceled Krystal Sands luxury condo tower was planned.

Weiner said "benchmarks" are being set on the north Strip -- the sale of 26 acres across from the Sahara to MGM Mirage for $444 million, the sale of the 35-acre New Frontier to an Israeli group for $1.24 billion. It's obvious that development opportunities are limited, he said.

"Even if there was anything left, at those prices, you can't afford to build these type of towers," Weiner said. "This is it for us in this area. Anyone who's here is in good position and I don't think there will be much competition. That's my take from the pure acquisition of land. The only thing you can build is something with recurring income, one of those casinos in the middle of it."

Turnberry, a builder of luxury condos in Miami, came to Las Vegas in 1997 and closed escrow on the land once owned by Hilton Corp. As word filtered out, Turnberry Place became a hit among people who could afford luxury condos, including previous Turnberry buyers in Florida. That's when "interlopers and dreamers" started arriving in town, Weiner said.

"Word got out like Sutter's Mill. Developers came from New York, Australia, south Florida, Chicago, you name it," Weiner said. "They'd build a sales center and then, 'See you later.' But in the end, you have a good market. It's a growing market. Your base of employment here, all the economic indicators that are generally good for a destination resort are right and as the population matures, more multifamily housing will prevail."

Jason Fox, president of Luxury Mortgage Group in Las Vegas, said Wall Street analysts and certain segments of the media have "inappropriately cast doubts and predicted doom" for the high-rise market in Las Vegas, comparing it to Miami and other overbuilt areas.

He remains bullish on the market, citing a strong local economy and international tourism appeal.

Smith of Home Builders Research gives his opinion of high-rise condos in Las Vegas: "To me, they're all alike -- overpriced."

Turnberry Associates is renovating the Fontainebleau in Miami and developing two other high-rise residential projects in Miami. The company is also active in Houston, San Francisco, Virginia, north Florida and Atlanta and is a partner in a condo hotel in the Bahamas.

Weiner said Turnberry's going to take a break before delving into any further developments in Las Vegas.

"After 40 years of doing this we realize we're in a cyclical business," he said. "We're fairly conservative, risk averse. We do our homework. Rather than an optimistic eye, we look at things here with an educated eye. We tend to go on experience rather than instinct."

Competition for luxury condo development will move farther south on Las Vegas Boulevard and into the suburbs, Weiner said. People are looking for an easier lifestyle and the baby boomer generation is probably the next target, he said.