BluefoxToday blog : CityCenter puts off Veer Towers completion - Las Vegas high-rise condominium market still struggling

CityCenter puts off Veer Towers completion - Las Vegas high-rise condominium market still struggling

CityCenter puts off Veer Towers completion - Las Vegas high-rise condominium market still strugglingMGM Mirage is now planning to open the two-tower luxury complex - sitting in the middle of CityCenter and drawing admiring and sometimes quizzical looks with its two leaning towers - in May. It was scheduled to do so in mid-December when most of the mammoth multi-billion-dollar resort on the Strip began welcoming its first guests. The reason to the delay is quite clear. The current economic slump has deeply trimmed down the potential buyer pool for condos at Veer Towers. The same actually goes for all high-rise projects in Las Vegas.

Mortgage finance has been a problem all along. Lenders are staying away from Las Vegas luxury condo scene ever since the real estate market here stunningly caved in. To help move inventory MGM Mirage started offering seller financing in December but obviously its impact has been marginal at best. It also cut prices by 30% to ease buyer concerns about the continuous weakness on that front. Values throughout the condominium segment - from Florida and across to California - have been very leaky mostly due to rampant overbuilding. Las Vegas with its incomparable entertainment flavor didn't escape any of that either.

The recent housing bubble brought luxury condos to Las Vegas in a big way, on a firm developer bet that Vegas was now ripe enough for such a product. Most of them would be vacation homes for those yearning to scoot occasionally over to the desert oasis for some R & R. That's especially true for the Strip destinations. A trailblazer in this by many accounts was Turnberry Place that some locals had doubts about at first but then turned into a very successful project. Everybody and his nephew saw that and quickly wanted to cash in on the emerging trend. The stampede was on.

MGM Mirage joined it and is now struggling mightily with the condo product. Las Vegas high-rise condominium prices have seen much better days and 30% discount in them for Veer buyers is not near where the brutal real estate market forces say they actually are. It's difficult even for an in-house mortgage lender to underwrite a loan on a property with contract price and appraisal being miles apart. Without further price adjustments the many unsold units there will be hard to move anytime soon. Perhaps they should be used as hotel rooms for the time being, until the housing market picks up.


Provided by: 

Esko Kiuru
Mortgage, real estate and apartment industry analyst - syndicated mortgage, housing and property management blog
My cell: 702-499-1006

Comment balloon 6 commentsEsko Kiuru • April 22 2010 03:07PM


Esko that is a step backwards for Las Vegas.  Appraisal issues are hard to overcome, and don't look like they are going to go away in the near future.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) almost 8 years ago


High-rise condo segment in Vegas is still in the doghouse, to put it mildly.

Posted by Esko Kiuru almost 8 years ago

Esko: Thanks for the update. It may be years before things return to a sense of normalcy there. If any area was overbuilt it may have been Vegas. I wish you well!



Posted by Paul McFadden, Pest Control, Seattle, WA. (Paratex) almost 8 years ago


Weak demand absorbing all the condo inventory alone will take years.

Posted by Esko Kiuru almost 8 years ago

I heard it from you about Veer Towers, Esko!  They are going to have to do owner/developer financing if the buyers want financing and to preserve prices!

Posted by Renée Donohue, Las Vegas Real Estate Broker - (Savvy Home Strategies Realty, LLC-REALTOR®-Estate-Probate) almost 8 years ago


Looks like pricing is a big concern there despite the developer financing. Even with the 30% discount announced earlier.

Posted by Esko Kiuru almost 8 years ago