Las Vegas set a record in 2019 for the two most expensive high-rise resales in its history as the high-end luxury market of $1 million and more carried the day over lower-priced units in the valley.
The record-setter at $12.5 million at the Palms Place is the highest-known sale recorded on the Multiple Listing Service and set the tone for 2019.
The high-rise condo market saw 27 percent fewer sales in 2019 in 21 towers tracked by research firm Applied Analysis. Overall in 2019, luxury sales of $1 million or more were the strongest price segment with 60 sales, down only two from 62 in 2018, the firm reported.
Seven of the top 10 sales of the year, including at Palms Place, closed during the second six months of 2019.
Ivan Sher, broker owner with the Ivan Sher Group of Berkshire Hathaway HomeServices, said there’s an ebb and flow between luxury single-family homes and high-rises. Many times, people from out of state want to come to Las Vegas, test the market and rent or buy a small place to get a feel for the city.
“Ultimately, they end up buying,” Sher said who added he remains optimistic for 2020. “The luxury market in general, whether single-family or high-rise, I think we’re going to have a very strong year.”
High-rise condo outlook
Applied Analysis released a report on high-rise sales tracked in 2019 that there were 607 sales, down 27 percent from the 836 sales in 2018. That’s the fewest since 2015, when there were 626 sales.
The average price of units sold in 2019 rose 17 percent over 2018, going from $511,759 to $598,728. The price per square foot rose 7.7 percent from $394 to $425.
Applied Analysis Principal Brian Gordon said one reason for the decline might be the premium prices asked for condos, which continue to increase. There were 458 units on the market at the end of 2019 with an average price of $757,910, or $543 a square foot.
“The pricing dynamics for some may not make financial sense for investor or rental perspective, and sales volume shrunk slightly,” Gordon said. “Prices have continued to escalate at a pretty substantial pace and demonstrates that demand remains in the high-rise market. But sales are affected by overall availability because fewer units on the market can dampen sales volume.”
Ken Lowman, owner of Luxury Homes of Las Vegas, said he believes sales slowed because there is less supply of condos on the market.
“The number of sales is down and prices are up, and that tells me the supply has dropped,” Lowman said. “All those people who bought in 2007 and 2008 and wanted to sell them for years when they could, we burned through all of that inventory. Now, we’re back to less people that want to sell and more people that want to keep them. That means less for sale even though the prices are going up.”
Lowman said he remains optimistic about 2020 sales with low interest rates, a rising stock market, population growth, the Raiders starting their first season in Las Vegas, new resorts opening in the next two years and billions in spending on other projects.
“All the conditions are set to have a super-good real estate market in the first six months of this year and maybe longer,” Lowman said. “We’re still seeing an influx of wealthy people primarily coming from California but from all over the U.S. The local executives and business owners are doing very well too because our economy has been good in Las Vegas.”
Stirling Club reopening helps Turnberry
Four of the 21 high-rises tracked had an increase in sales during 2019, while Turnberry Place remained even at 60 — the best among the top 13 towers that have a large sales volume. It’s companion, Turnberry Towers, which has a lower price point, went from 53 sales to 47.
Realtors are pointing to a big reason for Turnberry Place leading the pack among the largest condo towers is the reopening of the Stirling Club at the end of 2018 after it was closed since May 2012.
“Turnberry Place is all of a sudden on people’s radar screen again because the Stirling Club had been closed for many years,” Lowman said. “That’s one of the key points of buying there and caused their sales to hold up better than other projects.”
The Stirling Club has a dining room, meeting rooms, tennis courts, spa and gym.
“It was a central social hub for those four towers at Turnberry Place,” Lowman said. “When it was closed, it left a void, and all of those people would have to leave the site to get those services. Now, they just ride down their elevator and walk and they’re there.”
MJ Blunk of Wardley Real Estate, whose sale at Turnberry Place made the top 10 list for 2019, agreed that the Stirling Club is an amenity that draws people. Sales declined after the Great Recession and Stirling Club closure, and people are now coming back, she said. At one point, it had no sales of units at 4,000 square feet and above for 18 months, she said.
“It was time for it to come back,” Blunk said. “I’ve seen more interest in Turnberry Place in the last six months than the last three years. A lot of people had previously taken their units off the market, leased them or just gave up.”
Blunk said that people weren’t willing to pay the prices sellers were asking and that some buyers were turned off by construction on the Paradise Road corridor that made it difficult to get in and out. Expansion of the Las Vegas Convention Center and the openings of Resorts World Las Vegas and The Drew resort will make Turnberry Place even more attractive, she said.
“We can look at all the projects going in, so that’s going to help,” Blunk said.
The average price at Turnberry Place fell 5.5 percent from just over $795,000 to $751,605, the highest price other than the Waldorf Astoria along the resort corridor. The price per square foot rose 4 percent to $319. Turnberry Place has a lot of second and third homeowners compared with Turnberry Towers, which tends to have younger owners and units that sold on average at $455,767 in 2019, Blunk said.
As for why high-rise sales were down in 2019, Blunk said there is competition with new homes and resales that have competitive prices for potential condo buyers.
“I think the new build has been so competitive and beautiful that people are looking at it,” Blunk said. “But I’m still bullish on Las Vegas high-rises. I have a lot of clients from California coming to Las Vegas.”
The Waldorf Astoria in CityCenter, where sales had been strong in previous years, saw a decline of 54 percent from 39 to 18. Those units that did sell were priced at $2.5 million, up 48 percent from $1.7 million. The price per square foot was $1,253, up 15 percent.
Randy Char, broker with Char Luxury Real Estate, who had the No. 2 sale of the year at just over $8 million at One Queensridge Place, said the Waldorf Astoria might be down because there were such strong sales in previous years with the excitement over the construction of Allegiant Stadium for the Raiders. Sales could pick up after the stadium opens in the late summer, he said.
Char said the sales of units $1 million and above would have surpassed 2018 if there were a greater supply available.
Char said Waldorf Astoria prices went up because they sold larger units in 2019 and suggested that Turnberry Place sales might have been boosted by sellers renovating aging units and that buyers see the $319 a square foot per sale as a value.
“It was a solid year, and the high-end of the high-rise market is still very healthy,” Char said. “There are people who come to Vegas that want a second home but don’t want a traditional house. They already have one and can afford the higher price points in some of these towers. I see that continuing to do well. We’re still lower priced than other markets, and we’re not building new towers so there’s limited supply as demand continues to grow as people that come from California and other places want this lifestyle.”
Other condo sales
Park Towers east of the Strip on Flamingo Road, west of Paradise Road, had six sales, up one in 2019. Park Towers had the highest average price at $2.08 million, a gain of 19 percent over 2018. The price per square foot at $596 was up 16 percent.
One Queensridge Place went from 22 to 20 sales and had the third-highest average sales price at $1.89 million, up 30 percent. The price per square foot at $496 was up 3.4 percent.
The Trump hotel condo tower went from 58 to 25, but the average price of those sold at $381,912 was up 30 percent. The price per square at $522 was up 10 percent.
Newport Lofts in downtown went from five sales in 2018 to 18 in 2019. Platinum rose from 11 to 12. The Vdara condo hotel at CityCenter went from seven to 15. Veer Towers in CityCenter went from 57 to 35 sales.
Panorama Towers went from 84 to 66; Palms Place 62 to 44; MGM Signature 85 to 72; Juhl 48 to 23; One Las Vegas 80 to 45; Allure 39 to 37; Sky Las Vegas 34 to 24; The Ogden 54 to 27; Soho Lofts nine to six; Metropolis six to four; and Boca Raton 18 to three.