According to the Las Vegas Review Journal, Miami-based Related Group, has announced plans to buy three project sites and build apartment complexes. It hopes to break ground next year and have one or two other deals underway by 2020. Rental rates are on the rise in Vegas, vacancy is low, as is supply so developers are helping to fill the gaps. But high rises have lost their allure in Sin City. “It’s pure economics,” Steve Patterson, head of Related’s apartment division, said Friday. Someone might build another residential tower in Las Vegas, he said, but his company “probably won’t be the first.”
Patterson figured tenants might have to pay more than $3 per square foot for a high-rise project to work financially. But at that rate, a 1,000-square-foot unit would cost more than $3,000 a month, far too expensive for most locals, given that Clark County’s median household income is around $52,600, federal data show.
To make them more affordable, developers would have to build tiny apartments. But those might draw little interest amid the abundance of larger and less expensive options around town. Who wants to live in a shoebox if you don’t have to? Las Vegas consultant John Restrepo, founder of RCG Economics, said he doesn’t expect any new high-rises for the foreseeable future. Residents can’t afford them, he said, and Las Vegas doesn’t fit the profile of a typical high-rise market — a densely populated city with water views.