Council weighs city hall plans

Wednesday's discussion of a new Las Vegas City Hall included words like "revolutionize" and "tipping point," but it also included the frankest assessment of another word -- "risk" -- that's been offered in public conversations about erecting a new city headquarters by 2011.

The new city hall is still in the planning stages, but city officials have gone to great lengths to show a new building as an anchor and catalyst for further downtown redevelopment.

"It's a complex transaction. But it's a transaction that could revolutionize downtown," said Mayor Oscar Goodman. "This is the future of Las Vegas as a city."

The transaction has several players and many moving parts. The basics are that the city and a developer would swap land so that Las Vegas gets a city hall site within an office complex and the developer gets a place to build a hotel-casino downtown. The boost in tax revenue from the developments could go a long way to covering the new city hall's costs.

"This is probably the most sophisticated real estate deal we've ever been presented," Councilman Steve Wolfson said. "Everything seems to suggest this is a great deal for the city. What's the downside?"

One need only listen to current economic news to know that, said Scott Adams, the city's business development director.

"Who would've guessed three years ago that we'd be where we are in America, with the air being let out of our housing values," Adams said. "The downside is the inherent market. We can't control that macro environment."

The council approved an agreement Wednesday with two developers, LiveWork and Forest City, that would trade land the city owns in Union Park for a 2.7 acre parcel on First Street between Lewis and Clark avenues. That property is now home to the closed Queen of Hearts casino and low-cost apartments.

The developers would build a new city hall at that corner, which the city would either lease for 30 years or purchase.

The developers also own four blocks adjacent to that corner; and the city would essentially be an anchor tenant in an office complex built by the developers, who would also be responsible for building a 1,000-room hotel-casino in Union Park.

The six acres under the existing city hall site would be combined with 12 acres the city owns at Las Vegas Boulevard and Stewart Avenue and sold for more redevelopment.

Plans include successful redevelopment of the now-closed Lady Luck Casino. Plans for that project could be presented in June, Adams said.

Revenue from the sale of city-owned land plus increased tax collections from the office development and the new casinos would more that cover the estimated $10 million annual cost for the new city hall, according to Adams' data.

The worst-case scenario, he said, is that the land swap, casino and office towers don't go through. Las Vegas would still have the option of buying the Queen of Hearts site and building on it, and would still own the Union Park site and the 18 acres around the existing City Hall.

Forest City's Dmitri Vazelakis told council members that it's in his company's interest to complete the other parts of the project in order to get access to the Union Park casino site, because that's where the profit will be made.

Mayor Pro Tem Gary Reese said he's ready to face down public skepticism over a need for a new city hall.

"I know that it's been questioned many times: 'Why now? Can't you just add on?' " Reese said. "Our naysayers are going to look at us again and say, 'They're reaching. They're groping.' "

Councilman Larry Brown said that since Las Vegas may have reached its geographic limits, the city's financial future may depend on making the most of development downtown.

"I think this project is the tipping point ... where downtown becomes the place to secure our financial stability," he said. "We're not going to be able to generate the revenue in traditional ways."

Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.