Las Vegas Homes and Real Estate News
Welcome to the neighborhoods Mar. 03, 2006 November's Bureau of Land Management auction in Las Vegas featured an array of home-building brands familiar to locals. The five-company partnership that won the bidding for 2,675 acres in North Las Vegas included Olympia Group, known for its Southern Highlands master plan in southwest Las Vegas. Also in the joint venture: American West Homes and Astoria Homes, two of Southern Nevada's biggest private builders, and D.R. Horton, the nation's biggest home builder. In April, Standard Pacific will begin selling homes at its Mountain Shadows community at Commerce Street and Azure Avenue in North Las Vegas. The 77-lot neighborhood will feature single-family homes ranging from about 3,100 square feet to 3,500 square feet and up to six bedrooms. Prices will start in the high $300,000s; models will open in August, and the first homeowners should move in during the fourth quarter, said Las Vegas Division President Gary Cavender, a former Signature Homes executive who helped convince Standard Pacific to enter the market in 2005. In 2006, Standard Pacific will launch three more North Las Vegas neighborhoods: Desert Ridge will have 85 single-family homes, Tropical Village will contain 526 single-family homes and Centennial Villages will offer 186 townhomes. In addition, Standard Pacific will begin building Skyline at Paradise Hills, a 105-lot community in Henderson. The communities will carry starting prices ranging from the high $200,000s to the $600,000s. In addition, Cavender estimates Standard Pacific's share of the North Las Vegas joint venture will net the company 200 acres to 300 acres of land to build on -- enough space for as many as 1,600 homes upon the community's projected build-out in 2012 or 2013. Larry Murphy, president of real estate research firm SalesTraq, said Standard Pacific's lot inventory and land holdings have already gained the company heft in the market. "Standard Pacific sounds like a significant player in Las Vegas," Murphy said. "For a company with their credentials and the local people they have working for them, the probabilities are very good that they're going to succeed." Still, it's not an easy time to debut on the Las Vegas home-building scene. Raw land destined for residential construction can command more than $1 million an acre, up from around $250,000 an acre three years ago. Cavender said Standard Pacific is paying $500,000 or more per acre for the property it's acquired outside the North Las Vegas partnership. Those high land prices come as builders face the most competitive local market yet -- a twin dynamic that could put downward pressure on profit margins for some companies. Murphy said the Las Vegas Valley now contains 492 actively selling subdivisions, the highest number he's tracked since he began keeping data more than a decade ago. Just three years ago, for example, local builders were offering roughly 280 actively selling communities. Also, the boom era of 2004 has passed; analysts say it's unlikely that such go-go days will return to Las Vegas. "The incredible times are over," Murphy said. "The first half of 2004 was a once-in-a-lifetime event, and I don't expect to ever see that again in my lifetime. But Standard Pacific isn't too late to the party," he said. "This is a good market that will still absorb 35,000 to 40,000 new homes in 2006, and we'll still have single-digit appreciation. There are always opportunities for a good operator," he continued. "There are builders who go broke in a boom market and builders who make money in a bust market. It all depends on how tight you run your ship, and how good, smart and lucky you are." Cavender said Standard Pacific will use several tactics in its bid for more property to build on. First, joint ventures with existing landowners could help the company find land on a less costly basis than the going market rate. In addition, the company is cobbling together 5- and 10-acre parcels of contiguous land to create bigger swaths for mid- and large-scale development. Also on the agenda are future partnerships to take down more Bureau of Land Management tracts. Standard Pacific will also consider entering outlying markets with more affordable land, including Pahrump and Mesquite, though Cavender said no solid plans for such a move exist yet. Any builder looking to expand quickly will also need to consider buying out established, privately held companies with sizable landholdings, Murphy said. Landing those private competitors could be tough, simply because there aren't many left in the market. But Murphy pointed to major homegrown builders including American West Homes and Signature Homes as attractive acquisition targets for any public builder seeking more home sites. Cavender said he wouldn't rule out "taking a look" at any local builders who decide to sell their operations. But he added that Standard Pacific has enough on its drawing boards to stay busy for the foreseeable future. The company will deliver just 45 homes in 2006, but that sales tally will jump to about 450 units in 2007 and as many as 800 homes per year in three years to four years -- numbers that will place Standard Pacific among the city's Top 20 builders. "With the inventory we have and our purchase in the BLM site, we're comfortable with where we are," he said. If you are planning to relocate in the Las Vegas area, contact us for a prompt response to any questions you have about the Las Vegas real estate market. 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