A 16-acre space across from CityCenter on the corner of Las Vegas Boulevard and Harmon Avenue is on the market for a lofty $800 million.
CBRE Senior Vice President Michael Parks, one of two executives leading the sale, said this to the Las Vegas Sun:
“This parcel is truly prime Las Vegas real estate, surrounded by iconic Las Vegas brands in an area that is quickly becoming the Times Square of the Strip because of its bright lights, digital advertising and increasing pedestrian counts.”
According to the Las-Vegas Review-Journal, the Spectrum Group Management will sell the retail buildings and parking lots that make up this lot on the Strip in sections. These sections are not large enough for a megaresort but could fit a boutique or luxury hotel.
Setting the price high
The $800 million figure comes from the listing broker, John Knott, of CBRE Group, the group hired to sell the property. That sums up to $50 million per acre. Back in 2015, the property was listed at $500 million, but it included the Spectrum, which sold for $59.5 million.
A parcel next to this property sold for $34 million an acre for 1.76 acres. Parks told the Las Vegas Sun that he expected this sale to set a record for land parcels paid for on the Strip.
While sales on the Las Vegas Strip have slowed, especially when it comes to open land, Knott said they’ve already held meetings with interested parties.
The site currently includes a Walgreens retail plaza, a food court, Fatburger, an empty Travelodge and a Harley-Davidson Cafe.
Acquired properties caution others on the Strip
There are quite a couple cautionary tales for the state of Las Vegas properties.
- Lucky Dragon
- Fontainebleau (The Drew)
- Resorts World
The Lucky Dragon and the SLS are examples of the difficulties to survive on the Strip.
New owner Alex Meruelo purchased SLS Las Vegas from Stockbridge Capital Group for an undisclosed price, but he said he posted $100 million in cash and ate the casino’s debt of $585 million.
In the meantime, supposedly the resort will under some fixes and embrace a new market in the Los Angeles area.
Even while these changes are underway, previously, a different establishment struggled through transition. Lucky Dragon failed to capture the Asian market as it attempted to do in 2016 as a Chinese-themed property.
Almost 18 months later, the Lucky Dragon wasn’t so lucky; it entered Chapter 11 bankruptcy after defaulting on a $90 million loan.
Properties still under construction
And supposedly, even if things do change, the changes take time. The Fontainebleau Las Vegas project, planned for a 2020 opening, will open as The Drew.
Construction began on the $2.8 billion sister hotel to the Florida Fontainebleau Hotel in 2007. Owners planned for a 2009 opening but the over 60-story building remained untouched for almost 10 years.
The deadline for Resorts World in Las Vegas, the Las Vegas Convention Center’s $1.4 billion expansion is 2020 as well. Originally planned for 2019, the project halted with a redesign after presenting the project to the Nevada Gaming Commission.
Wynn’s Paradise Park and the Wynn West property will expand Wynn’s total holdings to 280 acres of Las Vegas resorts. Purchased for $336 million, Wynn told the Las Vegas Review-Journal he expected the work to finish in three years’ time. However, with all of the legal turmoil surrounding the brand, progress on both projects is up in the air.
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