Las Vegas Sun

March 29, 2024

Developers of Tivoli Village acquire 23 neighboring acres

The developers of one of Las Vegas’s few major commercial projects’ under construction during the recession is doubling down on Southern Nevada’s recovery.

RA Southeast Land Co., an entity formed by the current owners and developers of Tivoli Village, acquired 23 acres adjacent to its mixed-use development.

The vacant site is on the south side of Alta Drive at Rampart Boulevard, across the street from Tivoli Village, a project by Israeli-based IBD Development Corp. and EHB Cos.

Tivoli Village, slated to open in March, will have 225,000 square feet of retail and 145,000 square feet of office space in its first phase.

“I believe they are going to expand their retail and entertainment development across the street,” said Cathy Jones, president of Sun Commercial Real Estate, which represented the seller of the property, City National Bank.

Tivoli officials weren’t available for comment.

The development group paid $11.75 million or $501,280 an acre, Jones said. The property was valued at $1.2 million to $1.5 million an acre at the height of the market in 2006, she said.

City National Bank foreclosed on the property owned by Triple Five Development in September 2009. It was supposed to be an extension of the retail development at Boca Park, she said.

“It’s a really good piece of dirt and one of if not the most high-profile vacant spots off the Strip for entertainment and retail,” Jones said. “We went national for the marketing campaign, and there was a lot of interest in the property. We had three other buyers interested who were hoping they couldn’t close.”

The acquisition shows that developers are willing to buy land if its in a quality location, Jones said.

“We’re starting to see more land move because prices are lower,” she said.

The locale is a desired location for national retailers that brokers said are behind much of the interest in leasing in retail in Las Vegas.

Those retailers are taking advantage of reduced lease rates to expand or enter the market.

In its third-quarter report released this week, brokerage CB Richard Ellis of Las Vegas reported that the retail vacancy rate has improved in the past year and that increased leasing and taxable sales are encouraging signs about the long-term outlook of the Las Vegas retail market.

The valleywide vacancy rate was 11.1 percent in the third quarter, down from 11.3 percent in the second quarter. The vacancy rate was 13.2 percent in the third quarter of 2009.

For three of the past four quarters, more space has been occupied than has been vacated. Leasing activity has averaged more than a half million square feet per quarter for the first nine months of the year. The 1.6 million square feet leased this year is 33 percent higher than the first three quarters of 2009.

No other retail space is under construction and virtually nothing is planned.

Taxable sales in Clark County increased 5.5 percent to $2.3 billion in July, marking the second time in two years that taxable sales have increased in the valley.

“While taxable sales are still well below their prerecession levels, the increase is an indication that consumer confidence is starting to regain ground, which bodes well for retail tenants and landlords,” CB Richard Ellis said.

The asking lease rates continued their decline in the third quarter, averaging $1.66 per square foot, down 6 cents since the second quarter and 18 percent over the past year.

The office market also showed positive signs in the third quarter with vacancy rate falling to 24.1 percent, down from 25.4 percent in the third quarter. That’s the first decrease in seven quarters.

The third quarter marked the first time this year when more businesses occupied space than vacated it.

Low lease rates are spurring activity and no buildings are coming online, according to CB Richard Ellis.

Join the Discussion:

Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.

Full comments policy