California investors buy Las Vegas apartment complex for $50M

Tower 16 Capital Partners bought the 512-unit Foothill Village, 6255 W. Tropicana Ave. in Las Vegas, in a joint venture with Henley USA for $50 million. (Anton Communications)
Tower 16 Capital Partners bought the 512-unit Foothill Village, 6255 W. Tropicana Ave. in Las Vegas, in a joint venture with Henley USA for $50 million. (Anton Communications)
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Southern California real estate investors acquired a Las Vegas apartment complex for $50 million.

Tower 16 Capital Partners announced Friday that it bought the 512-unit Foothill Village, 6255 W. Tropicana Ave. at Jones Boulevard, in a joint venture with Henley USA.

The sale closed June 28, property records show.

Tower 16, based in Carlsbad, California, said it will oversee nearly $7 million in renovations and upgrades at the complex, which has three swimming pools, two basketball courts and other amenities.

The property is now called Altura on Tropicana. Clark County records indicate it was built in the 1970s and 1980s.

Henley is based in the United Kingdom and has U.S. offices in the Boston area, Florida, and Newport Beach, California.

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.

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Las Vegas Chinatown complex sticks out from other new rentals

The Breathe floor plan at Lotus apartment complex on Spring Mountain Road near Valley View Boulevard Monday, May 25, 2018. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
The Bamboo floor plan at Lotus apartment complex on Spring Mountain Road near Valley View Boulevard Monday, May 25, 2018. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
The view the under-construction rooftop sky-lounge at Lotus apartment complex on Spring Mountain Road near Valley View Boulevard Monday, May 25, 2018. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
Lotus apartment complex on Spring Mountain Road near Valley View Boulevard Monday, May 25, 2018. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
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Compared with other apartments popping up in Las Vegas, developer Jonathan Fore’s new project is in a location that is different than most.

The Strip is a mile east of his complex, Chinatown’s numerous eateries are just to the west, and its closest neighbors include an empty, graffiti-covered former strip club.

Fore is also charging pricey rents at his project, Lotus — and the building has drawn plenty of tenants.

He said last week that the 295-unit luxury complex at 3616 Spring Mountain Road is 49 percent leased. Units are opening in phases, and Fore said the last batch will be ready in September.

Amenities include a rooftop deck, a poolside DJ booth, a karaoke room, a virtual-reality sports room, and 8,000 square feet of ground-floor retail space that is slated to have three restaurants.

“Life is better in the Lotus position,” its website proclaims.

Las Vegas’ apartment-construction boom is heavily concentrated in the suburbs, where it’s easier and cheaper to build. Lotus, however, is part of a small but growing tally of rental projects in urban, more centrally located areas.

Fore, managing partner of Fore Property Co., has another one on the drawing board. He said he plans to break ground in October on a six-story, 293-unit complex on Twain Avenue just north of the Rio.

At Lotus, Fore said, the average apartment is 880 square feet, and tenants are paying an average of about $1.92 per square foot. That amounts to about $1,690 per month. By comparison, the average rental rate in Las Vegas is $1,003, according to Reis Inc.

Fore acknowledged he is charging a steep price, but, citing the lack of competition being built nearby, said he’s renting an average of about 11 units per week.

“There really hasn’t been anything new built here in the last 30 years,” he said.

His tenants include workers on the Strip, pilots and flight attendants, and Californians who visit Las Vegas frequently.

Las Vegas’ apartment market has heated up in recent years. Rents are climbing faster than the national average, the vacancy rate is among the lowest in the country, and investors are snapping up properties throughout the valley.

Suburban development is seen as a less risky venture, as developers have repeatedly shown they can sign tenants and fetch certain rents. In urban areas, the rental rates probably would have to be higher to make projects financially feasible, but there is little of a recent track record.

According to Fore, investors and lenders for suburban projects can go to their investment committees, “point at the deal next door” and say theirs will work because the other project is landing certain rents. For Lotus, he added, there was nothing to compare to.

Still, he figured he would rather have “300 units amongst myself” in the Chinatown area than “300 amongst 3,000 on the (215) Beltway.”

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.

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Las Vegas pool builders ‘extremely busy’ amid construction boom

The Las Vegas Strip is seen as a swimming pool is under construction by Poolscapes in a new house in Southern Highlands on Tuesday, July 3, 2018, in Las Vegas. Bizuayehu Tesfaye/Las Vegas Review-Journal @bizutesfaye

Driving around Las Vegas, it’s easy to see the housing tracts, apartment buildings and other projects coming out of the ground.

But in backyards across the valley, something else is being built at a rising clip: swimming pools.

“All the pool builders I know are extremely busy,” Vintage Pools owner Gary Verbano said.

Last year, 987 permits were issued for pool projects in unincorporated areas of Clark County, along with 633 in Henderson and 157 in North Las Vegas. Those tallies have all more than doubled since 2012.

Efforts to obtain city of Las Vegas figures for that timeframe were unsuccessful.

The number of swimming pools dug out of the desert remains well below the peaks of the mid-2000s housing bubble. But after tanking during the recession, business has climbed in recent years amid more home construction and the improved economy, Las Vegas pool builders said.

Renaissance Pools & Spas owner Jim Alexander said he built 600 pools in 2004 but only about 50 annually during the recession. He expects to build more than 200 this year.

He said new builders are getting into the business and others who bailed years ago are returning.

“If the economy wasn’t strong, they wouldn’t be coming back in,” Alexander said.

Poolscapes owner Ivan Friedmutter said he expects this year to be his best ever and noted that pool construction isn’t the only aspect of the economy that’s picking up. Among other things, car sales, airport passenger traffic and gambling revenue are also rising.

“Everything’s a little busier,” he said.

Paragon Pools founder Joe Vassallo said most of his projects are at new houses and that pool construction usually climbs when homebuilding picks up in Las Vegas.

Their fortunes do seem to mirror each other. Builders closed almost 39,000 sales in Clark County in 2005, then just 3,900 in 2011 and 9,400 last year, according to Home Builders Research.

Vassallo – who occasionally writes pool-related stories for the Las Vegas Review-Journal – said he did a peak of nearly $8 million in annual business before the recession. That dropped to $1 million per year, but he’s on pace for more than $4 million this year.

Fueled by easy money, Las Vegas’ real estate market was roaring in the mid-2000s, and pool building was no different. Back then, homebuilders often sold pools with houses and rolled the extra cost into the mortgage, Vintage Pools’ Verbano said.

But when the bubble burst, lending, homebuilding and practically everything else in the economy, including pool construction, did a faceplant.

North Las Vegas, for instance, issued 851 permits for new swimming pools in 2006 but just 77 in 2012, city figures show.

Numerous pool builders went out of business, contractors say. Alexander said he temporarily closed two of his three stores, and Vassallo said he stayed in business in part by remodeling and repairing pools, including those in abandoned houses.

Vassallo said that when Las Vegas was grappling with heavier volumes of foreclosures and short sales, lenders sent out marketing materials to drum up business but included asterisks that said: “Except in Nevada.”

“You could get a loan for a pool anywhere in the country, except in Nevada,” he said, adding: “We’ve risen above that now.”

Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter. Review-Journal staff writer Wade Tyler Millward contributed to this report.

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