LAS VEGAS — Mayor Oscar B. Goodman leaned forward from his seat in the rear of a white van to get a better view.

“My downtown, a place where there wasn’t a crane, look at it,” Goodman said as he cruised from Las Vegas City Hall toward the 61-acre Union Park development that will include retail stores, a Frank Gehry-designed medical center and a $200 million performing arts venue.

On the route, construction cranes tower over steel that is morphing into condominiums, hotels, casinos and shops, even as retailers, developers and real estate brokers gathered at the convention of the International Council of Shopping Centers here, which ends today.

Multibillion-dollar projects, almost all featuring a retail component, are sprouting in Las Vegas and its outlying communities, as well as in Reno, 450 miles to the north. As retail consolidation challenges growth, these areas represent promising markets. Nevada, boosted by an income-tax-free business environment, is flush with relocating companies and residents that have doubled the population to 2.4 million since 1990 and made it the fastest-growing state.

“You have a state that is not only booming in population growth, but also booming in multilevel consumers,” said Wendy Liebmann, president of market and retail consulting firm WSL Strategic Retail in New York, citing 51 million tourists annually, the local workforce and a new group of second-home buyers. “We’re seeing Nevada move to become one of those really dynamic states…particularly for retail.”

Among the projects are:

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  • The $4 billion Union Park — to be built on city-owned land and described by Goodman as “a city within a city” — will include 3,600 residential units, 2.3 million square feet of offices, 420,000 square feet of retail space and three hotels and casinos.
  • Project CityCenter, which is being developed by MGM Mirage for $7 billion, will occupy 66 acres tucked between the Monte Carlo and Bellagio hotels on the Strip and is to include 500,000 square feet for some 80 stores.
  • Howard Hughes Corp. is developing a 100-acre Main Street-style retail and residential complex called Shoppes at Summerlin Centre about 10 miles west of the Strip, with 1.2 million square feet of retail and four department store anchors.

  • Executive Home Builders plans 75 stores on 700,000 square feet of commercial space at its $850 million European-inspired, mixed-use development, Village at Queensridge, 11 miles west of Las Vegas at Peccole Ranch.
  • Barneys New York is building an 85,000-square-foot flagship on the Strip as part of the Palazzo Hotel Resort Casino.
  • Chelsea Property Group, a division of Simon Property Group, is expanding its 435,000-square-foot Las Vegas Premium Outlets by 25 percent, adding as many as 30 new stores to a 120-tenant list that includes St. John, Dolce & Gabbana and Lacoste.
  • The $1.8 billion renovation of the Grand Sierra Resort in Reno is increasing the retail footprint to between 600,000 and 800,000 square feet, more than 10 times the existing space.
  • Station Casinos Inc. wants to build a hotel and casino featuring a Bass Pro Shops Outdoor World superstore on 88 acres in Reno.

To be sure, not all green-lighted projects are completed. Condo deals with alluring names like Icon Las Vegas, Krystal Sands and Aqua Blue haven’t materialized because of escalating costs for land, construction and labor and waning demand. In addition, rising energy costs and interest rates may dampen the economy.

“I don’t have any fear of that,” said Dan Van Epp, president of the mountain division of Newland Communities in Las Vegas, who is overseeing the development of Union Park. The Gehry-designed Lou Ruvo Alzheimer’s Institute will open in 2008, and the shopping promenade is to bow a year later. “We’re bringing 6,000 new residents a month in. The city is continuing to expand.”

Real estate developers are building higher and packing a dense mix of residential, commercial and office properties, because about 87 percent of Nevada’s land is managed by federal agencies overseeing wildlife refuges, military bases, dams and other installations, and Las Vegas’ sprawl is confined to a valley sandwiched between mountains.

“There’s a limit to sprawl,” said Andrew Sasson, owner of Light Group, which is developing a 700-room boutique hotel at Project CityCenter on the Strip and a five-story condominium project called Spalofts. “That’s why density is the new wave.”

Or is it? “The question is their viability,” said Jeremy Aguero, principal analyst with economic and fiscal consulting firm Applied Analysis in Las Vegas, referring to as many as 60 proposed mixed-use projects. “Do people want that?”

Nevada is trying to reduce its dependence on gambling for revenue. Casinos and hotels are the largest employers in the state, with 217,800 workers, or 17 percent of the estimated 1.3 million-member work force. Still, businesses face the challenge of finding skilled employees.

“If you want high-wage jobs, you need people with good education and good skills,” said Brian Bonnenfant, manager of the geographic information services program at University of Nevada at Reno.

Still, it is the glitz that lures the tourists. In the fiscal year ended last June, shoppers bought $2 billion worth of apparel and accessories in Nevada, or 16 percent more than in the previous year, according to the Nevada Department of Taxation. The state’s total taxable sales grew 14 percent to $44 billion in that period compared with 13 percent in the previous year, to more than $38.2 billion.

WSL Strategic Retail’s Liebmann said that as long as retailers remember to cover both high-end and discount shopping, they can continue to reap the benefits.

“What we see here is this tremendous opportunity to serve lots of markets and have lots of freshness and lots of new consumers that are very eager to spend,” Liebmann said.


Home to 70 percent of the state’s population, Las Vegas and the cities that make up Clark County in southern Nevada drive the economy.

“The economic engine is running on all cylinders,” Aguero said.

Las Vegas has $30 billion worth of planned construction of hotels and casinos slated to open by 2010. From 1996 to 2005, the city created 335,000 new jobs, increased inflation-adjusted taxable retail sales by $6 billion and added 17.2 million square feet for anchored retail centers, excluding malls, to a base of 25.2 million square feet, Aguero said.

Shopping is a favorite pastime in the entertainment and gambling mecca.

“To a retailer, Vegas will be in their top 10, if not their top 5, or will be the best store in their chain,” said Madison Riley, partner and retail strategist at Kurt Salmon Associates’ Boston office. “It’s just that good.”

Take Ted Baker London’s 4,000-square-foot boutique in The Forum Shops at Caesars Palace. As the U.S. flagship for the British designer label, the store ranks first in terms of sales, size and merchandise selection among the seven shops in the American market, said assistant manager Paxton Porenta. Ted Baker might open a couple more stores in Las Vegas.

“We want to build our brand,” Porenta said.

The twist is relying on transient customers. For instance, Ted Baker can maintain the same window display for an entire month. But when the calendar is clear of conventions, concerts and sports events, and vacationers prefer to lounge by the pool rather than shop in the summer heat, “it’s dead,” Porenta said.

“We’re as much in the tourism business as we are in the retail business,” said Michele Rothstein, senior vice president of marketing for Roseland, N.J.-based Chelsea Property Group, which operates both Las Vegas Premium Outlets and the Las Vegas Outlet Center.

Las Vegas is catching up to New York and Los Angeles in the caliber of brands, said Meital Grantz, owner of Talulah G Inc., who opened her third Las Vegas-area boutique in April at the Red Rock Casino, Resort & Spa in Summerlin. Grantz said there’s always room for more retail. “Every time there is a new property that goes up, it creates more jobs, it creates more opportunity, it creates buzz,” she said.

Nonetheless, Frank Visconti, president of retail for MGM Mirage and a former general manager of Neiman Marcus in Las Vegas, said the city needs a new concept. “There’s no place to walk around,” said Visconti, who oversees retail operations for MGM Mirage properties, including Project CityCenter, which is to open in November 2009.

Modeling Project CityCenter on Roppongi Hills, the Tokyo shopping complex where visitors can gaze at art by Louise Bourgeois and Takashi Murakami while strolling to shops and restaurants, Visconti envisioned a mix of contemporary, designer and lifestyle brands.

“There might be six to eight opportunities [for retailers] to have a flagship,” Visconti said, noting that Project CityCenter, which will be leased by the Taubman Centers, wasn’t designed to include an anchor.

Project CityCenter will include a 60-story hotel and casino, luxury condominiums and boutique hotels.

“Mixed use” is the catchphrase among developers.

The city requires that downtown at least 70 percent of a building’s ground floor must be devoted to retail, said redevelopment officer Bill Arent.

Eli Applebaum, executive vice president of Executive Home Builders, which is developing the Village at Queensridge, set to open in 2008, predicted that mixed use will enhance permanent residents’ lives. “As a local, do I want to shop on the Strip with the tourists, or do I want to shop in my neighborhood?” Applebaum said.

For Mayor Goodman, the goal is clear. “We’re trying to create a place where people live 365 days a year,” Goodman said.


Reno calls itself “the biggest little city in the world.” Long overshadowed by the Las Vegas area, which has 1.7 million people compared with Reno’s 390,000, the former cow town is coming into its own.

“We’ve seen a tremendous increase in retail square footage,” said Kelly Bland, senior vice president of retail properties for Alliance Commercial Real Estate Services in Reno. The city is adding 2.5 million square feet of retail space to the 11.4 million square feet it had two years ago, he said.

Leasing prices are also rising. For new big-box stores occupying 20,000 square feet or more, annual leases increased between 2004 and 2005 to $14.50 to $15.50 a square foot, from $12.50 to $13, Bland said. For new line shops, annual leases grew to $22.20 to $27 a square foot, from $18.

“Look at how quick it comes,” Dodd Mitchell, founder of Los Angeles’ Dodd Mitchell Design, said of Reno’s development.

As the creative director of the $1.8 billion renovation of the Grand Sierra Resort and Casino, formerly the Reno Hilton hotel three miles east of downtown, Mitchell is overseeing the renovation of a total of 2.7 million square feet, including the layout of eclectic shopping that he promised will be similar to The Forum Shops at Caesars.

In addition to top luxury labels, Mitchell wants to attract quirky vendors, including one he found in Paris that sells handmade jewelry for less than $100.

For years, the big-name apparel retailers in Reno have been Macy’s, Sears, J.C. Penney, Gottschalks and Wal-Mart Supercenter. Because of the relatively limited options, Reno residents were spending as much as $300 million annually on shopping in California cities such as Roseville, Sacramento, Walnut Creek and even San Francisco, said Harry York, chief executive officer of the Reno-Sparks Chamber of Commerce. Residents made the 115-mile drive to Roseville to shop at Nordstrom and other stores unavailable in their hometown.

“Things are changing,” York said.

One big change was the March 15 opening of the 663,792-square-foot Summit Sierra, the first major shopping center built in Reno since Meadowood Mall in 1979. Dillard’s, Zumiez, Lucky Brand Jeans, Chico’s, Abercrombie & Fitch, Coldwater Creek, Guess and some 30 other national retailers entered the Reno market for the first time at the outdoor Summit Sierra, owned by privately held Bayer Properties LLC of Birmingham, Ala.

Lucky, the Los Angeles denim brand owned by Liz Claiborne Inc., opened a Reno location as part of plans to open 40 U.S. stores this year. “Reno is up-and-coming,” Lucky spokeswoman Jezzica Lindkrantz said in a statement.

The vibe at Summit Sierra is emphasized with bronze statues of cavorting children and Sixties classic rock piped through speakers. Based on the mix of stores, Summit Sierra, 10 miles south of downtown, seems to be geared toward soccer moms and teenagers. Zumiez is tucked between Pacific Sunwear of California and Hot Topic on one block, while Lane Bryant, Cacique, Gap and Chico’s are lined up in a row.

Jeffrey Bayer, ceo of Bayer Properties, said Summit Sierra offered a broad mix of merchandise. “Meadowood Mall was the last opportunity for an affluent customer to shop,” he said.

Bayer said his company can add another 600,000 square feet to Summit Sierra, which cost $100 million to build.

Larry Hunt, senior property manager for Summit Sierra, said Bebe and J. Crew have started construction on their stores — the first for each company in Reno — and both plan to open in June. He said the second phase of development will entail another department store and more specialty shops. The center is seeking to cater to 20- to 45-year-old customers and have an upper-moderate focus.

The only department store at Summit Sierra is Dillard’s. “We see a growing community,” said Cliff Heller, manager of the 200,000-square-foot unit.

The move to Reno comes 25 years after Dillard’s opened the first of four stores in Las Vegas. “Dillard’s has wanted to be here [in Reno] for years,” Heller said, adding that the closest of the Little Rock, Ark., company’s 329 stores is some 180 miles away in Stockton, Calif.

Summit Sierra leases on annual basis for $41.40 a square foot, with an additional fee of $7.80 a square foot for taxes, insurance and maintenance of the fire pits, 220 hanging plants and other amenities in the common area, according to Alliance Commercial’s Bland. “That’s definitely on the high end of the spectrum,” he said.

Las Vegas-based Station Casinos plans a hotel and casino on 88 acres across from Summit Sierra. A spokeswoman said Bass Pro Shops is the only retailer so far that is committed to open at the site.

With gasoline prices hovering more than $3 a gallon, Carie Laur said she can save on trips to California to shop at Ann Taylor Loft and other stores that were previously unavailable in Reno. “I used to go to Roseville a lot,” said the 36-year-old pharmaceutical sales representative.

Executives at Meadowood Mall said Reno’s economy has diversified to the point that there are enough people to support both the 900,000-square-foot Meadowood and Summit Sierra.

“Now they have more shopping options, and they will stay here and shop, which is good for our local economy,” said Cynthia Moore, marketing director for Meadowood, which is owned by Arlington, Va.-based Mills Corp.

A different shopping option is on a busy side street leading to downtown. Jenna Harlin’s boutique The Attic is an anomaly in the neighborhood, with its triangle-shaped roof, wooden porch and rock-lined sidewalk. Inside, contemporary fashion, ranging from Reo Starr’s denim gauchos to Basic Law’s funky blazers, hangs on copper pipes attached to teal-painted walls. Pastel-hued panties from Honeydew and white and black Ts from American Apparel accentuate the blond hardwood floors.

Harlin, who bought the boutique last September, hopes to double annual sales to $300,000 in two years.

Women have already parted with hundreds of dollars for jeans by Sass & Bide, Taverniti So, 1921 and some 20 other premium brands at Kalifornia Jean Bar, which opened a block away from The Attic in October. Mike and Christy Hall unlocked the etched-glass doors to their 2,500-square-foot shop in a historic red brick building with hopes of bringing in lines that were previously unavailable in the area. Their first-year sales goal is $2 million to $3 million.

The Halls are bullish enough about Reno to be opening a 1,500-square-foot shop called Indigo at the Summit Sierra in August. Christy Hall said Indigo will stock higher-end, fashion-forward brands such as 12th Street by Cynthia Vincent, Wyeth and Imitation of Christ’s denim and sportswear to appeal to affluent shoppers.

“We didn’t know if anyone would pay $200 for a pair of jeans,” Christy Hall said. “They have.”