After spending millions a year on rent, Southwest Gas Corp. has cut a hefty check to become its own landlord.
The Las Vegas-based natural-gas provider bought the bulk of its Chinatown corporate headquarters this month for $16.5 million cash.
The property, on Spring Mountain Road just west of Decatur Boulevard, consists of three main office buildings. Southwest Gas has owned one since it opened in 1988 but had been leasing the others since they opened in 1982.
It bought those two buildings July 1 from a group of investors led by Equity Resource Investments of Cambridge, Mass.
The purchase should save Southwest Gas money in the long run, as the company had been spending about $2 million a year in rent for the buildings since 2008, said Ken Kenny, vice president of finance and treasury.
Among those, Building A is one story at almost 59,000 square feet. Building B is two stories at about 75,500 square feet, and it has a “workable” basement with employee workspace, Kenny said.
Building C, originally owned by Southwest Gas, is about 75,000 square feet, he said. That building also has a built-out basement, home to the utility’s information technology department.
Maria Meyer, director of investor relations and administration for Equity Resource, said her company is “not at liberty to comment on specific transactions.”
Southwest Gas, which serves 1.9 million customers in Nevada, Arizona and California, had $85 million in cash on its books as of March 31, according to a regulatory filing.
However, the real estate purchase comes after a recent drop in earnings.
Southwest Gas posted $71 million in first-quarter profit, down 12 percent from the same period in 2013.