Tuesday, Sept. 1, 2009 | 2 a.m.
Las Vegas’ economy is going to need more than CityCenter’s opening — and massive hiring — to rebound to pre-recession employment levels, a local economist says.
Las Vegas’ jobless rate in July had jumped 90 percent since July 2008, the state’s Employment, Training and Rehabilitation Department reported Aug. 21. July’s jobless rate was 13.1 percent, up from 12.3 percent in June and 6.9 percent in July 2008.
For the employment rate to return to pre-recession levels, an additional 60,000 jobs are needed, Brian Gordon of the economic consulting firm Applied Analysis said. In July 2006, as the economy boomed, Las Vegas’ jobless rate was 4.6 percent and the economy had a year-over-year increase of 48,900 jobs.
Prospects for job growth in the next six months are few. CityCenter is expected to create 12,000 jobs when it opens in December, but the 3,000-room Cosmopolitan next door isn’t expected to open until the third quarter of next year.
CityCenter’s hiring could lower the jobless rate 1 percentage point, Gordon said.
“It will certainly help to stop the bleeding,” he said.
— Nicole Lucht
•••
Lenders have been patient when it comes to repossessing commercial buildings, but they are picking up the pace in taking back undeveloped land.
That’s the take after the latest land transaction report from Applied Analysis. It said sales were up 42 percent in the first six months of 2009 compared with the same period in 2008. In the second quarter alone, the 395 acres transferred were 41 percent higher than in the first quarter and 77 percent higher than in the second quarter of 2008, the firm reported.
Trustee sales and deeds in lieu of foreclosure made up the bulk of the activity, suggesting banks are taking back more property than in the past, Applied Analysis’ Gordon said.
The increased activity prompted off-Strip land prices to rise slightly after five quarters of decline. The average price per acre sold in the second quarter was $255,300, up 6.2 percent from the first quarter, Gordon said.
Despite the increase, the amount paid for land off the Strip is down 55 percent from the second quarter of 2008.
No transactions involving land on the Strip were reported in the second quarter.
— Brian Wargo
Dennis Smith, president of Home Builders Research, says it appears that lenders who may be holding about 20,000 foreclosed homes in reserve are releasing them slowly on the Multiple Listing Service.
They are concerned that releasing too many homes too quickly will push down prices even further and result in smaller returns, Smith said.
In July the median sale price of existing homes was $125,000, the same as in June. It’s down 41 percent (or $85,000) since July 2008, he said.
The number of foreclosure properties on the service has fallen over the past four months from about 12,000 to fewer than 8,000, Smith said. In addition, the number of short sales is increasing, with more than 12,000 listed with the service.
As for the rest of 2009, Smith said that, based on what he is hearing from real estate agents, sales of existing homes will be flat. That’s not a problem because some lenders couldn’t handle more transactions because they don’t have the staff to process more loan packages, he says.
Builders are making up for a lack of home construction by working with banks and investment groups on projects that were never completed, Smith said.
“They are finishing lots, houses, doing property management-type duties or whatever it takes to keep people working,” Smith said.
— Brian Wargo
Versions of these stories appeared in In Business Las Vegas, a sister publication of the Sun.
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