What a difference a mile and a half makes.
Lily Funds founder Tom McManus recently announced that he sold 2.2 acres of land along the south Strip for about $12.8 million. The price-per-acre, almost $6 million, would be the envy of any landowner outside the Strip in the Las Vegas Valley.
But it didn’t even come close to a similar-sized property up the street.
Developer Brett Torino and New York’s Flag Luxury Group acquired a 2-acre plot at the multi-tower CityCenter complex last year for around $80 million — which, at $40 million per acre, exceeded land deals on the Strip during the frenzied mid-2000s bubble.
Despite their proximity to each other, there are some obvious reasons why two 2-acre pieces of real estate traded for wildly different prices.
Stretches of the Strip
McManus’ plot, along Las Vegas Boulevard at Russell Road, sits on a stretch of the Strip with a noticeably mixed landscape and, compared with other areas of Las Vegas’ famed casino corridor, light foot traffic.
In that area, the west side of the street has such megaresorts as Mandalay Bay and Luxor. But the east side of the street features vacant lots, a few small motels, some boarded-up buildings, some retail space and the never-finished SkyVue observation wheel project, which for years has consisted of little more than two giant concrete columns sticking out of the ground.
By comparison, Torino’s site, at the southwest corner of Las Vegas Boulevard and Harmon Avenue, is near several massive hotels, including Aria, Vdara, The Cosmopolitan of Las Vegas and Bellagio. It’s also next to luxury mall Shops at Crystals and across the intersection from a three-story retail project that Torino and Flag Luxury developed about a decade ago.
Moreover, big crowds of tourists regularly pass through the area, and the intersection already has pedestrian bridges, making it easier for potential shoppers to access the developers’ new four-story retail complex, Project63, which is under construction.
‘Start to see some movement’
McManus told me Friday that, as he sees it, it’s “hard to compare” the two 2-acre sites.
He noted the CityCenter plot is “in the heart of things” on the Strip, but he figures the south edge of the corridor is poised to gain momentum.
Clark County commissioners last fall approved plans for Dream Las Vegas, a 20-story hotel-casino near the land McManus just sold, and, with real estate sales and development plans picking up in and around the Strip, the SkyVue site and adjacent parcels went on the market recently in a 26-acre offering.
McManus also is looking to sell another plot along the south Strip, saying he has nearly 2.5 acres priced at $20 million.
“I think that this side will start to see some movement,” McManus said.
Torino was unavailable to comment Friday, a representative said. When I asked Torino about his purchase price last year, he said that he wasn’t getting a “usable” 2 acres but that the site featured such infrastructure as utilities, parking, and distribution and trash facilities.
He also noted, among other things, the heavy traffic of people out front.
“It doesn’t get any better,” he said.
So, will land on the south Strip trade for anywhere close to $40 million an acre? Your guess is as good as mine.
But plenty of money has been sloshing around Las Vegas’ real estate market lately, and, given the Strip’s near-never-ending parade of development ideas, someone is bound to come up with more plans at some point for the southern edge of the corridor.