Monday, April 1, 2002 | 11:03 a.m.
A $30 million retail project is planned for the Strip south of the Hilton Grand Vacations timeshare project, but the shopping center's success may hinge on whether resort projects in the area come to fruition.
NewMark Merrill Cos. plans to begin construction by the end of the year on the Boulevard Collection, a two-story, 55,000-square-foot retail project that abuts the southern edge of the Hilton's timeshare.
Hilton placed its 1,500-unit timeshare complex on indefinite hold following the events of Sept. 11.
Brad Pearl, vice president of Tarzana, Calif.-based NewMark Merrill, said the resumption of work on the timeshare project would help the developer's efforts to market the Boulevard Collection.
"Right now, we're in the process of nailing down 50 percent of the tenants," Pearl said. "We have letters of intent (to sign leases) from a number of parties. It seems everyone is waiting for the Hilton to continue -- they want proof that things are going forward again. Prior to 9-11, we had more interested tenants than we had space available. After 9-11, when Hilton pulled back, that created a signal to people to hold on until they see the market is coming back."
Pearl said he has "heard rumors" that work will resume on the Hilton project in 30 to 60 days.
A Hilton Hotels Corp. spokeswoman said the company does plan to renew building at the timeshare site, but she was unable to give a firm date for when work might begin again.
"It is an accurate statement that the company plans to restart (the timeshares), but I don't have any specific dates," said Kathy Shepard, vice president of corporate communications for Hilton. "We are going to restart them, hopefully this year."
Hilton's timeshare and a London-themed megaresort Turnberry Associates plans to build on the old El Rancho site across Las Vegas Boulevard aren't the only Strip projects that encouraged NewMark Merrill to begin developing the Boulevard Collection.
"We believe the growth of (Las Vegas) Boulevard will proceed to go north now," said David Frank, NewMark Merrill's chief executive. "In addition to the Hilton project and the future Turnberry project, there's Steve Wynn's project. There's a list of projects (on the north Strip) that will eventually come out of the ground."
In addition, a 26-acre property that Sahara owner Bill Bennett owns at the southwest corner of the Strip and Sahara Avenue remains on the market.
Bennett has had the property, which he acquired in 1995 from the Howard Hughes Corp., on the market for nearly two years.
The asking price has remained the same: $65 million, or $2.5 million per acre.
"We continue to market it, and we have interest periodically, mostly from people who have a vision for a gaming development," said John Knott, managing director of CB Richard Ellis, which is handling the property's sale. "The challenge seems to be that most people who want to buy it don't have the money."
Though major projects are planned for the north Strip, their somewhat distant planned openings led one local retail analyst to say it may be too early for any sizable retail development -- such as the Boulevard Collection -- to be built in the area.
"(NewMark Merrill) may be just a little ahead of the development curve for that end of the Strip," said George Connor, a retail specialist with Colliers International. "It may be a strong project five years from now, but to start a project like that today, they'd be pioneers."
Frank countered that the Boulevard Collection wouldn't open before 2004, and that he expected enough of a critical mass of tourists around the Boulevard Collection at that time.
Connor said the Hilton timeshare and Turnberry's London-themed megaresort, which is tentatively planned to include more than 2,000 rooms, would be key to the success of the Boulevard Collection.
Frank said the developer is talking to several nationally known sit-down restaurants about occupying the three restaurant sites on the property's second floor. He said NewMark Merrill is seeking retailers ranging from soft-goods sellers to jewelry stores for the shopping center's first floor.
Lee & Sakahara designed the Boulevard Collection; NewMark Merrill is accepting bids from general contractors to build the property.
Pearl said asking lease rates at the Boulevard Collection range from $4 to $10 per square foot a month.
Connor called the lower range reasonable, but said the $10 figure "seems very high for that area."