Deal would drop city from suit

A shuttered, beat-up apartment complex in one of Las Vegas' crime hot spots is set to get a fresh start, according to an agreement before the Las Vegas City Council this week.

The settlement would also extricate the city from a lawsuit that accuses city officials and other parties of cheating a California developer who wanted to buy the troubled complex last year.

The city ended up buying the 80-unit complex, which is near the corner of Tam Drive and Sahara a few blocks west of the Strip. It was to be renovated and rented as affordable housing, but instead has sat vacant as the legal wrangling and accusations unfolded.

If approved by the council, Walt Walters, a California businessman, would purchase what's known as the Monterey Villas apartments for $5.2 million -- about $1 million more than he originally intended to spend.

He would have 30 days to start remodeling work, and the apartments would rent to tenants 55 and older. Target monthly rents for the first year are $550 for a one-bedroom unit and $750 for a two-bedroom.

"He's going to give us a promissory note for the same amount as the city paid for it," said city attorney Brad Jerbic. "On his dime, he's going to turn it into senior housing. And it goes back on the tax rolls immediately."

Walters' attorney, Stephen Cummings, declined comment.

"Oh, I don't think we're interested in discussing it," Cummings said Monday.

The Monterey Villas saga goes back several years.

It previously was called the Aladdin Villas, and was shut down in 1998 for "numerous code violations," according to city documents. It was purchased, renovated and sold again, and operated as Monterey Villas from 1998 to 2003, when it was shut down for operating without a business license.

The apartments are on the south end of the Meadows Village neighborhood, an area of narrow streets, vacant lots, well-worn apartments and condemned houses that's sandwiched between the shiny Allure high-rise condo building and the closed Crazy Horse Too topless club.

The streets there are also known for violence and drugs.

In the past 60 days, the area within a quarter-mile of the complex has seen seven assault calls -- including four involving a gun or a deadly weapon. There have also been 11 stolen car reports, two burglaries, two robberies and 30 drug-related incidents, according to Las Vegas police statistics.

Even so, the 1.3-acre property attracted interest last year when it was in foreclosure and headed for auction.

Walters put together a deal with Monterey Villas LLC to buy the complex for $4.6 million. After assessing the extent of the needed renovations, he lowered his offer to just under $4.2 million.

The city also put together an offer -- $5 million plus closing costs. But it was a "backup" offer, according to court filings, to be exercised only if Walters' deal fell through.

And here, according to Walters, is where things got hinky.

The day before closing, the sellers asked for more than 500 pages of financial documentation that hadn't been requested in the weeks leading up to the sale. He couldn't meet the deadline, his deal was canceled and the city bought the property for a higher price.

Walters sued Monterey Villas LLC, the city, and several individuals involved in the transaction, alleging that there was a conspiracy to undo his bid to purchase the apartments.

The settlement with the city would release Las Vegas from the lawsuit "with prejudice," which means Walters couldn't re-file those complaints. The council is scheduled to vote on it Wednesday.

The rest of the case remains active, though, and the next hearings are scheduled early next year.

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