Henderson, developer consider 118-acre land swap

A potential land swap between Henderson and a developer might help the city avoid political and legal backlash.

Lennar Corp., lead developer on about half of the Sage Mountain Ranch project that city officials and nearby residents say is too close to the Henderson Executive Airport, has been negotiating a like-value exchange for its 118.13 acres of the 257-acre project.

Assistant City Manager Bristol Ellington said the Sage Mountain land and city land are being assessed to find parcels of equal value, but negotiations are in the preliminary stages.

“It won’t be acres-to-acres, it will be value-to-value,” Ellington said.

In an April 21 letter to the city, Lennar offered 14 undeveloped parcels on Executive Airport Drive near St. Rose Parkway for various parcels throughout the city that could be developed single-family residential. The Sage Mountain parcels were assembled by various investors for $12.6 million between 2008 and 2013, according to Clark County records. Lennar is reviewing 297 acres of city-owned land, most of it zoned single-family residential.

Jeremy Parness, division president for Lennar, said the home builder believes a land exchange could be a “win-win situation” for all parties.

“The properties are all suited for residential development,” Parness said. “It provides us, in a different way, with some beautiful locations to build amazing Lennar communities with.”

The land Lennar is reviewing includes 10 single-family parcels inside San Eduardo Estates off U.S. Highway 95 and Nevada State Drive, 59 ares of raw land bordering San Eduardo Estates, and 32 acres on U.S. 95 and College Drive, as well as other various parcels. The 32 acres was recently offered at auction by the city, but no bids were received at the appraised value of $9.5 million.

Ellington said Lennar will not receive all the parcels listed in its letter, and some have already dropped off the list.

In a May 13 letter from the city to Lennar, Ellington wrote that the “nature of the property” the developer has identified for a potential swap “may involve a substantial financial investment for Lennar.”

Sage Mountain Ranch is a proposed mixed-use development that would develop 1,540 single- and multifamily residences on 204 acres, 137 acres of which would be houses. The remainder of the development would be 44 acres of commercial and an 11-acre public park at the center.

While the proposal includes retail and other commercial use, it is the request to build single-family homes and other residences on most of the land that is causing the most controversy.

Sage Mountain is a development involving Lennar, financial firm Rialto Capital and Soro, a Nevada limited liability company.

It has received stiff opposition from city planners, residents of the nearby Seven Hills and Anthem communities, and businesses already operating in the west Henderson area. The city Planning Commission on Feb. 13 unanimously denied the project zone changes, and the proposal has been continued by the City Council four times.

The latest continuance came Tuesday when City Manager Jacob Snow asked the council to have until Oct. 7 so the city could to explore “a number of alternatives to this development that staff is exploring.”

Ellington said the city has done land swaps with other developers in “unique situations.” One of the concerns is that the city could be open to litigation if the project is denied. Residential use for that land was approved against city planners’ wishes in 2006. The City Council overrode requests and approved the 126-acre City Crossing project, which included plans for 2,500 luxury residential units and two boutique hotels.

Another city concern is that Sage Mountain sits in the midst of what Henderson plans to develop into a west Henderson industrial district. Current businesses Levi Strauss &Co. and FedEx Ground have expressed concern the residential project could harm business operations, which include using large trucks in the area.

Ellington said acquiring the Sage Mountain parcel would benefit the long-term vision of city planners, which includes leveraging the proximity of the airport to lure corporate businesses.

“Our industrial space is limited in Henderson,” Ellington said. “This allows us to take ownership of a significantly large piece of property that we will have the ability to develop over time as industrial property.”

Parness said Lennar and the partners still believe Sage Mountain is a good project, but are willing to discuss a swap if the city is wanting to protect the land for industrial development.

“What we’re trying to do is find some sort of alternative,” Parness said.

Sage Mountain has brought protests from residents of Seven Hills and the Anthem communities, which are south and east of the airport, claiming the new development would take away the only safe path for planes in and out of the airport that doesn’t have housing.

If houses are built at Sage Mountain west of the airport, the residents who move there will end up filing noise complaints about the airport, Ellington said. Residents of nearby Seven Hills, Anthem and Inspirada to the airport’s east are worried airplane noise will increase if planes start flying in that direction to avoid Sage Mountain to the west.

Nearly 130 residents attended Tuesday’s meeting in case the project was heard and voted on by the City Council. Ron Meek, president of the Seven Hills Master Community Association which claims to represent 8,000 residents, said before the meeting he supports a city land swap to keep houses off that land.

“You stand in my backyard and you will see planes already flying over my house all day,” Meek said. “If they build houses on the other side of the airport, it will only get worse.”

Parness said Lennar is sensitive to people’s concerns and that is why the home builder is pursuing the swap.

“We don’t want to build something people just don’t want,” Parness said. “That is why we are open-minded to a solution like this and working hard to find an alternative that makes everybody happy.”

Another city concern is potential litigation if Sage Mountain is denied, a concern that is not without precedent.

The city spent $66,714 during a four-year court case brought by another developer that ended in a land swap approved by the City Council on June 17.

While Lennar leads a group of investors pursuing a land swap, the remaining Sage Mountain land holdings are controlled by local real estate developer Joseph A. Kennedy, who is content to work with the city on developing its 126 acres, according to Ellington.

Kennedy did not return calls for comment.

Contact Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3882. Find him on Twitter: @KnightlyGrind.