Another Las Vegas High Rise Condo Project Bites the Dust

What does mother nature and the Las Vegas high rise condo market have in common?

Survival of the fittest. Only the strong survive.

And I must say the latest project to fall from grace is a shocker. Yesterday, The Related Cos. officially pulled the plug on their 500 unit Icon Las Vegas project leaving many in the real estate community (myself included) with dropped jaws in that this is really the first project to be cancelled which boasted a truely solid developer.

By underestimating the cost to build here in Vegas, they were faced with two options: fail to honor customers purchase agreements and raise reservation prices - or cancel the project outright. They made the right decision, albeit painful. So ICON's done and those who secured units in the project will have their monies refunded and another proposed Las Vegas high rise condo project bites the dust.

But here's what really bothers me about this announcement - in the same breath that the developers used to announce the cancellation, they maintain they're still moving forward with their $3.5 billion dollar Las Ramblas project located on Harmon Avenue! Logic dictates that if they can't make a seemingly "home-run" project in an excellent location right off the strip like ICON work, how can they expect people to buy into their Las Ramblas deal? Add to that the fact that Related also pulled out of the deal to develop 61 acres in downtown Las Vegas and you've got a company that's acting like they don't really believe they can succeed in Las Vegas.

The sad reality of the situation is there are only a couple of "real deals" in town. We've been saying that for awhile now and the market is slowly but surely justifying our position. And trust me that the ICON won't be the last to cancel. When a company like Related can't make a go of it in Las Vegas, you can't be blind to the reality that other high rise condo developers with lesser resources won't make it either, no matter how good the deal looks or whatever "phase" you bought in on. As a high rise unit purchaser, your ideal situation would be for your project to work while everyone else's fails.

Bet you wish you bought that Tower A residence at MGM now, huh? Or perhaps that unit in Turnberry? There's still time - act now, while there are still units left, because believe me, when everyone finally wakes up and figures out there aren't that many good options in town, those will be the first to go... and you'll probably make some decent money with it as well.