Nevada’s population growth and its bullish business climate has resulted in a statewide building industry with nearly $9 billion worth of construction spending in 2007, reported McGraw-Hill. Construction is the state’s second largest and fastest growing employer, reveals the Nevada Department of Employment, Training and Rehabilitation (DETR). The industry is responsible for nearly 150,000 jobs statewide – about 11 percent of the workforce.
“Nevada’s job growth has been running three to four times the national average in the past several years,” said Terry Johnson, DETR director. “The construction industry is expected to increase by 10,000 jobs in 2007, including positions for heavy-equipment operators, carpenters, electricians and other craftsmen.”
Construction contributes $5.1 billion annually in wage and salaries, while generating $14.7 billion worth of economic activity, making it second only to the leisure and hospitality sector. For every $1.00 of construction activity, it creates $1.57 in business activity.
“The industry is inextricably linked to the state’s economic and fiscal successes during the past decades,” said Jeremy Aguero, principal of Applied Analysis, a Las Vegas-based economic research firm. “There are numerous billion-dollar-plus projects planned or underway and a backlog of public infrastructure improvements in the development pipeline.”
Much of that construction revenue is being spent along the Las Vegas Strip, with $35.46 billion worth of construction projects planned through 2010, reported the Las Vegas Convention & Visitors Authority. Currently approved plans will add 42,092 more hotel rooms, 2,562 timeshare units and 3.49 million square feet of convention space. Another $13 billion in tentative projects calls for an additional 36,703 hotel rooms and 7,088 timeshare units.
CityCenter
Yet no job is larger than MGM Mirage’s Project CityCenter – a $7.4 billion, 18.67 million-square-foot hotel/condo/entertainment complex being built on the Strip between the Bellagio and Monte Carlo resorts. It’s the largest privately financed project in U.S. history, company officials claim. CityCenter will be the size of Rockefeller Center, SoHo and Times Square combined. The Empire State Building, by contrast, is only one-eighth the size.
Perini Building Co., the project contractor, will employ up to 7,000 people during the peak of construction activity, or one-third of Southern Nevada’s total union trade workforce, said Perini Vice-Chairman Dick Rizzo. Situated on 76 acres, the seven-building development will consist of 2,702 condo and condo-hotel units and a 500,000-square-foot shopping mall designed by World Trade Center architect Daniel Libeskind. The site is anchored by twin 60-story glass hotel towers, totaling 6.5 million square feet, with a 1,800-seat Cirque du Soleil theater. Designed by Cesar Pelli, architect of the Petronas Towers in Kuala Lumpur, Malaysia, the non-themed, 4,000-room hotel will have a 200,000-square-foot casino and a 225,000-square-foot convention center. In addition, five distinct towers will feature 1,543 condo-hotel units and 1,159 condos, as well as 15,000 parking spaces. The residential portion includes Helmut Jahn’s dual 37-story Veer Towers, combining for 700 condos; Rafael Vinoly’s 50-story, 1,543-unit Vdara condo-hotel; Kohn Pedersen Fox’s 442-room Mandarin Hotel and Residences; and Sir Norman Foster’s 228-unit Harmon Hotel & Residences.
CityCenter will be serviced by a 2,090-foot monorail extension, a $150 million people mover system and its own onsite fire and paramedic station. It will have 12.8 acres of open space with pedestrian trails, plazas and recreation areas. With 12,000 employees, plus residents and visitors, CityCenter could see 30,000 people a day when it opens in November 2009. That’s roughly double the population of Boulder City.
Cosmopolitan Resort
Immediately adjacent to CityCenter abuts the new $2 billion Cosmopolitan Resort Casino currently under construction at the northwest corner of Harmon Avenue and the Strip, adjacent to the Bellagio. Perini is the general contractor. Cosmopolitan consists of two 53-story glass-and-concrete towers with a five-level retail, casino and entertainment podium. The 3,000-room condo-hotel property is being developed by Ian Bruce Eicher. Cosmopolitan Resort Casino is scheduled to open in 2009.
Echelon
Boyd Gaming Corp., however, isn’t one to be outdone. On June 19, the firm broke ground on the $4.8 billion Echelon, just north of CityCenter on the Strip. The mixed-use complex is located at the former site of the Stardust hotel-casino, which was imploded in March. The project will have five hotel towers with a combined 5,000 rooms. Morgans Hotel Group, owner of the Hard Rock, is contributing the Delano and Mondrian hotels for 1,600 rooms. The two hotels, designed by Miami architect Chad Oppenheim, will cost $950 million to construct. Hong Kong-based Shangri-La Hotels and Resorts will construct a 353-room hotel, and Boyd will build two hotels itself – Hotel Echelon and the Suites at Echelon.
The project is situated on 87 acres, with 22 acres set aside for future development. The eight-building development will be constructed through a series of low-bid individual projects, with New York-based Tishman Construction Corp. acting as construction manager.
“Boyd has made the project attractive to contractors with strong financial backing and a history of timely payments,” said Daniel Tishman, company chairman and CEO. “This is a design-buy-build project.”
Echelon will have a 750,000-square-foot convention center, a 140,000-square-foot casino and a $500 million, 300,000-square-foot shopping center jointly developed with Chicago-based General Growth Properties, the firm responsible for the Fashion Show Mall. The project additionally boasts two theaters – 4,000-seat and 1,500-seat theaters – both operated by AEG Live, Los Angeles, plus 9,000 parking spaces and 30 dining and entertainment venues. Echelon, despite its impressive bulk, is neatly bundled into an elegant,
upscale environment that’s sure to generate heavy buzz when its debuts in the third quarter of 2010.
But the Strip is already ablaze with construction projects like Steve Wynn’s $2.1 billion, 60-story Encore at Wynn Las Vegas, which consists of 2,032 hotel rooms and a 72,000-square-foot casino. Tutor-Saliba Corp, Sylmar, Calif., the general contractor, is scheduled to finish the 20-acre undertaking by early 2009. Las Vegas Sands is building the new $2.6 billion, 50-story Palazzo hotel-casino, just south of Wynn Las Vegas. Taylor International Corp., Las Vegas, is the contractor for the 3,025-room mega-resort that includes a 105,000-square-foot casino and 375,000-square-foot shopping mall. The 4,000-employee Palazzo will open later this year. In February, construction began on the $2.9 billion, 3,889-room Fontainebleau Las Vegas at the 25-acre former site of the El Rancho hotel-casino. The 63-story tower will have a 100,000-square-foot casino, 60,000-square-foot spa and a 3,200-seat theater. Developed by Fontainebleau Resorts LLC – headed by Turnberry Chief Jeffrey Soffer and ex-Mandalay Bay President Glen Schaeffer – the new Strip mega-resort will finish in the fall of 2009. Meanwhile, “The Donald” is building the $600 million, 64-story Trump International Hotel & Tower across the street, adjacent to Fashion Show Mall (see story page 26). Perini is the contractor for the 645-foot-tall, 1,282-unit condo-hotel tower. The gold glass skyscraper is scheduled to finish in February 2008. It will be followed by a second identical $700 million, 1,282-unit tower to break ground next year.
World Market Center
Downtown is also awash in construction work with projects such as the $3 billion, 12 million-square-foot World Market Center at Grand Central Parkway and Bonneville Avenue. Developed by World Market Center LLC and the Related Cos., New York, the 57-acre home furnishings design complex will consist of eight buildings ranging from 10 to 16 stories tall, all connected by skywalks. PENTA Building Group, Las Vegas, is now at work on the third and largest building – a 16-story, 2.1 million-square-foot structure. The $550 million addition is scheduled to finish in June 2008.
“The third building marks the milestone in our race to fulfill the vision of World Market Center as the predominant international market for the industry,” said Shawn Sampson, co-founder and managing partner. “Home furnishings is a $120 billion a year industry.”
Downtown Projects
Other downtown projects include the $107 million, 852,000-square-foot Molasky Corporate Center II at Grand Central and City parkways, which will be Las Vegas’ only LEED-certified Class A office tower when it debuts in September. The $104 million Streamline Tower, a new 275-unit downtown residential skyscraper, is scheduled to finish in February 2008 at Ogden Avenue and Las Vegas Boulevard North. Las Vegas-based Martin-Harris Construction is the general contractor. Cherry Development and Seegmiller Partners are developing the $87 million, 168-unit Newport Lofts nearby at Casino Center Drive and Hoover Avenue. Breslin Builders, the general contractor, will finish the 23-story residential high-rise later this year. Between Third and Fourth streets, CityMark Development is building the $167 million Juhl at 255 E. Bonneville Avenue.. The six-building complex will house 330 residences, 13 live-work units and 24,000 square feet of storefront shops. CityMark, the firm credited with reenergizing San Diego’s Lamplight District, was selected from a nationwide request-for-proposal process to develop the 2.38-acre city-owned site. Juhl’s first residents are expected to move in by April 2008. New York-based Turner Construction Co. is the general contractor.
The luxury condo and condo-hotel high-rise market is helping keep local constructors busy with 69 projects, totaling 45,616 units, planned in the first quarter, reported John Restrepo, principal of Restrepo Consulting Group, a Las Vegas-based economic research firm. While some well publicized cancellations have occured, many developments are still moving forward.
“There should be sufficient demand to absorb the 6,616 units in the 14 projects that have gone vertical and the 24,809 units that are proposed or haven’t broken ground,” Restrepo said. “Many of the vertical projects that have vertical are located along the resort and Harmon corridors.”Palms Place
The Palms hotel-casino, for example, is building the $650 million, 50-story Palms Place at Flamingo Road and Arville Street, a few blocks west of the Strip. The 599-unit residential skyscraper will open in time for Christmas. M.J. Dean Construction, Las Vegas, is the contractor. The $190 million, 41-story Allure Las Vegas on Sahara Avenue, also just west of the Strip, is slated to debut in September. The 428-unit residential skyscraper is being developed by Chicago-based Fifield Cos.
Boca Raton
The South Strip is a beehive of construction activity, as well, with the new $450 million, 756-unit Boca Raton at Serene Avenue and Las Vegas Boulevard South. Developed by Palm Beach Resort Condominiums LLC, the 15-acre mid-rise condo complex consists of four seven-story buildings. The first two buildings, totaling 378 homes, opened this spring with a two-level, 10,000-square-foot clubhouse. Boca Raton is scheduled for build-out by late 2009. Yet it’s just one of many emerging South Strip projects, including AmLand Development/B.S.R.’s $600 million, 960-unit ONE Las Vegas at Shelborne Avenue and Las Vegas Boulevard South. The 19.5-acre, five-tower condo complex will open early next year, with expected build-out by 2010.
Mixed-Use Commercial Projects
Southern Nevada also has several sizeable mixed-use commercial projects underway, like the $750 million, 117-acre Town Square at Sunset Road and Las Vegas Boulevard, South. The project, by Centra Properties and Turnberry Ltd., will consist of 150 shops, 12 restaurants, a 20-screen movie theater and 350,000 square feet of office space. The Las Vegas Chamber of Commerce recently signed a 10-year lease to occupy 35,000 square feet inside Town Square. “We are creating a one-of-a-kind shopping and entertainment destination,” said Mike Wethington, Town Square’s general manager. “This design could set a precedent in the Las Vegas Valley.” The 1.57 million-square-foot development, which includes Frye’s Electronics Superstore, is scheduled to open in November.
Other major projects are using a similar strategy by combining retail, office and industrial space. EJM Development Co.’s 450-acre, 5 million-square-foot The Arroyo, which is located along the north and south sides of the Interstate-215 Beltway between Rainbow Boulevard and Buffalo Drive. The complex calls for a total of 1.5 million square feet of industrial space, 1.8 million square feet of retail shops and 1.7 million square feet of office space. The mixed-use development is scheduled to reach build-out by 2015.
The Arroyo
EJM is currently at work on The Arroyo Corporate Center which consists of 12 buildings ranging from two to six stories tall, totaling 1.25 million square feet. It’s expected to open in January 2008, directly across from a 950,000-square-foot Arroyo Market Square – a 90-acre joint-venture project between EJM and Laurich Properties. Featuring three anchor tenants – Wal-Mart, Sam’s Club and Home Depot – plus 20 junior anchors, including Best Buy, Home Depot, OfficeMax, Marshall’s, PetSmart, Sports Chalet and others, Arroyo Market Square is scheduled to open in the fourth quarter.
Beltway Business Park
Big things apparently come in pairs, with Thomas & Mack Development Group/Majestic Realty Co. building the 400-acre Beltway Business Park directly across from The Arroyo. The Beltway Business Park will eventually contain 55 buildings, totaling 5.86 million square feet. Industrial space will make up 54.6 percent of the completed project, with 3.19 million square feet in 14 buildings; office space will account for 33.2 percent; technology will take up 7.8 percent; and retail space will comprise 4.4 percent, with 12 buildings combining for 260,500 square feet. The Beltway Business Park is estimated to reach build-out in 2012.
“We’re developing different product types to meet a variety of business needs,” said Rick Myers, Thomas & Mack’s executive vice president. “We are continuing to see strong and diverse economic growth fueling demand for office, retail and industrial space in Southern Nevada.”
Looking North
Northern Nevada, meanwhile, is experiencing its own building boom. One notable project underway in Reno is the $350 million, 600-room Peppermill hotel-casino expansion located on South Virginia Street. Plans call for an 18-story hotel addition and 63,000-square-foot convention center to finish by early 2008. Sierra Bay Constructors/SMC Construction are the joint-venture general contractor. Meanwhile, the University of Nevada, Reno is undergoing a $131.1 million expansion with the new four-story, 165,000-square-foot Joe Crowley Student Union Center, plus the adjacent five-story, 295,000-square-foot Knowledge Center library that includes a 200-seat auditorium. Q&D Construction is building the library, scheduled to finish in May 2008, while PENTA Building Group is handling the new student union, which is on track to finish this fall.
Virginia Lake Crossing
Further south, SilverStar Communities is building the Virginia Lake Crossing, a mixed-use development consisting of 220 homes and 100,000 square feet of retail, restaurant and office space between South Virginia Street and Virginia Lake, across from Park Lane Mall. “This is going to be a beautiful neighborhood ‘pocket’ where residents will be able to get to most places without needing a car,” said Reno City Council Member Sharon Zadra. “That makes it a model for the more environmentally healthy lifestyles we’re planning for Reno’s future. And it cleans up a very blighted corner at the southern gateway to our economic core.”
