Monday, July 5, 2010 | 2 a.m.
The prospectsThere is plenty of Summerlin land left for development. The 22,500-acre community has 8,900 undeveloped acres and plans to market and sell 7,000 net acres, owner General Growth has said in court papers.
The proposed dealGeneral Growth plans to sell hundreds of acres to homebuilders familiar with Summerlin and more land to an unnamed high-tech manufacturer.
The owner of Summerlin has disclosed plans to sell hundreds of lots to homebuilders in a sign that the residential building industry is preparing for growth in the master-planned community.
In papers filed last week in Bankruptcy Court in New York, General Growth Properties Inc. said it also anticipates selling Summerlin land to a high-tech manufacturer that would bring thousands of jobs to the region.
General Growth and Summerlin officials didn’t name the manufacturer, but it appeared to be the billionaire founder and CEO of Red Digital Camera. Last year he won Clark County zoning changes and waivers to plan a high-end digital movie camera plant, a sound studio, and homes for himself, actors and others in the movie industry in Summerlin “Village 16A” on Hualapai Way between Warm Springs and Sunset roads.
In a third proposed deal, General Growth would sell a parcel in Summerlin Centre. "Originally designed for condominium development, (the land) is a 7.21-acre parcel slated for development into an in-line retail strip center supporting luxury automotive dealerships with the possibility of two restaurants on the property," General Growth said in its court filing.
Tom Warden, senior vice president of community and government relations for a General Growth subsidiary, The Howard Hughes Corp., developer of Summerlin, said the commercial land sales haven’t been finalized and the bankruptcy filing was intended to clear the way for those sales, should they occur.
Big land sales in Summerlin — like the rest of Las Vegas — have virtually ground to a halt during the recession, and the homebuilding deals are the first significant land sales proposed by Summerlin since General Growth filed for bankruptcy protection last year.
Numbers compiled by Las Vegas analysis firm SalesTraq show how severely the local homebuilding industry has been hurt by the recession. Builders took out 30,149 permits in 2005 in the area, 20,999 in 2006, 12,836 in 2007, 5,551 in 2008, 3,776 in 2009 and this year through May have been pulling about 465 per month.
The time is right for Summerlin to resume development, Kevin Orrock, Summerlin’s top executive, said in a court declaration.
“After thorough analysis of business considerations, my colleagues and I believe that it is presently the appropriate time to continue the development of the Summerlin area by engaging in a series of sales of undeveloped property to capable builders,” Orrock said.
“We’re excited about it,” Warden said in an interview Friday. “It’s a positive turn for development in Summerlin.”
The bankruptcy court filing said the land is in the Amado neighborhood of the Mesa Village in the southern portion of Summerlin and is under contract with Richmond American Homes and Pulte Homes, each of which is experienced in building in Summerlin and complying with its design plans.
The neighborhood is expected to contain 503 finished lots, which are being sold to the two homebuilders for $37.9 million.
Land sales in Summerlin will be of special interest to the heirs of Howard Hughes, who claim a 50 percent ownership in its undeveloped land. General Growth last week filed court papers saying that since it’s in bankruptcy court proceedings, payments under a 1996 “contingent stock agreement” to the Hughes heirs should be subordinated to the claims of unsecured creditors.
There is plenty of Summerlin land left for development. The 22,500-acre community has 8,900 undeveloped acres and plans to market and sell 7,000 net acres, General Growth has said in court papers. The community is home to 100,000 people living in about 40,000 residences.
CORRECTION: This story originally misstated details about 7.21 acres in Summerlin Centre. The land originally was planned for condominium development, but the plan now calls for a retail center with luxury automotive dealerships and possibly two restaurants. | (July 5, 2010)