Just five years ago, the real estate market was in the depths of the recession, and there was little confidence it would ever rebound. Most projects had been mothballed, and there was no light to be seen for new development.
A couple of years later, confidence in the southwest valley was on the rise, and a new era in development dawned. With the emergence of the 215 Beltway making the area more accessible to the resort corridor, McCarran International Airport, Green Valley and Summerlin, the southwest valley continues to be ripe for new development.
The Current Landscape
Single-family homes are the biggest contributor to the changing landscape of the southwest valley. Builders acquired nearly 350 acres that will consist of approximately 1,600 homes, housing an estimated 4,000 new people, in the next couple of years. Development of these new homes already is approaching nearly 50 percent buildout — a sign of heightened consumer demand after years of little to no new product. Now, the market has tipped in consumers’ favor. Lower land costs have allowed builders to keep construction costs down and pass those savings on to homebuyers.
That said, the favorable land prices ($375,000-$400,000 per acre) have caused something of a land rush, and little remains for purchase by the private sector.
Multifamily developers acquired nearly 100 acres that will consist of approximately 2,500 multifamily apartment units. If all are successful, we should see an influx of approximately 5,000 new tenants in the immediate area that will most likely work, shop — and send their children to the several new charter schools that have opened in the area in the past two years as demand has increased.
Office, industrial, and retail users have acquired and developed — or are in the construction process of — more than 200 acres of commercial property, consisting primarily of corporate headquarters, furniture stores, and automotive dealerships seeking high visibility and Beltway frontage.
The Future is MUD
So what does the future hold for the southwest valley? I envision a mix of corporate offices with a mixture of “for sale” and “for rent” residential product, built in a mixed-use environment — possibly a vertical structure of five or more stories, with podium parking.
Hopefully, efforts to diversify the economy will make the next wave of development a true evolution in product design, as rising land costs coupled with a lack of land availability drive developers to introduce innovative product types that foster the kind of “live, work, play” environment the modern consumer craves.
Scott Gragson is executive vice president of the Las Vegas land division at Colliers International.