Some notes on early 2018 activity: So far, investors probing within or purchasing assets in Southern Nevada have been in full force this January. A majority of our clients are private companies or high net-worth individuals, with the rare institutional buyer mixed in. Many investors are interested in current yielding projects rather than speculative land purchases. There is always a request for “value-add” projects, however those tend to be rare within the market as those deals have often been stabilized already.
On occasion, buyers from outside of the region still mistakenly believe that Las Vegas is a distressed market. Instead, multifamily, single family rentals and a lot of industrial has been extremely strong. Retail performance tends to be very mixed, with some high quality projects with corporate backed tenants hitting the market, along with some smaller single tenant properties that are either vacant or have a mom and pop tenants. Overall, retail vacancy in Las Vegas is approximately 6.7% relative to 4.6% for Costar’s, national index. Nevertheless, the trend in retail vacancy continues to decline. Office continues to be one of the most challenged markets. There have been some institutional grade office deals over the past couple of years, however the majority of current offerings are owner-user type properties and the occasional cap rate building. Vacancies in the overall market are still two digits, landing at roughly 13% in the most recent quarter.