Prudent wait pays off for Paxton Walk developer

Having assembled 11 pieces of land starting with the first purchase in 1994, developer Avi Ruimi has the good fortune of not having to make business decisions based on debt financing.

That's what killed many of the other condo projects proposed in Las Vegas, he said.

Ruimi, an Israel native now living in Las Vegas, owns the 30 acres planned for Paxton Walk, a mixed-use development in northwest Las Vegas, free and clear. That's why he was able to suspend sales on the $200 million project, return deposits to about 50 buyers and wait until first quarter 2009 to begin construction.

"Sorry, the market doesn't allow me to continue," Ruimi said. "Because I'm so conservative and saw things in the market, I decided not to develop. I don't want to find myself in heavy debt and making decisions on how do I finance this project and maybe make the wrong decision."

Too many developers "came to the wedding" at the peak of land prices from 2004 to 2006, Ruimi said. He bought his last piece of land in Las Vegas six years ago. The recession is a "self-cleaning of the economy" and the first people to go under bought at the height of the market, he said.

"They all had good intentions. I feel bad for them," he said. "Each of them made a different mistake. I can analyze those mistakes in retrospect. At the time they made the decision, they were right. It's very difficult to predict a market like Vegas. It's not a market that gives you a sign before the bubble bursts in your face."

Ruimi, principal of Woodland Hills, Calif.-based Blue Marble Development, has spent $2 million on site improvements for Paxton Walk, including the widening and landscaping of Centennial Parkway at Tenaya Way. The project is planned for 2 million square feet of commercial and residential space, including 782 condos.

MORE AFFORDABLE: Housing affordability has improved dramatically in the last year, particularly in markets where affordability was previously most concerning, California housing analyst John Burns said in his May market intelligence report.

Of 380 metro areas across the country, the number of markets where the affordability barometer was 7.5 or higher (out of a possible 10) fell from 42 markets a year ago to three today.

In Las Vegas, where the median home price is $240,000, the ratio of housing costs to income is 37 percent, down considerably from 46 percent last year.

By comparison, Reno (median home price of $270,000) is 41 percent and Phoenix (median home price of $222,000) is 35 percent. California has some of the highest ratios in the nation, including San Francisco (93 percent), Los Angeles (71 percent) and San Diego (54 percent).

INDUSTRIAL CENTER: The Art Guild of Philadelphia signed a 36-month lease to occupy 37,500 square feet at Cheyenne Industrial Center, a $32 million project by Panattoni Development at Cheyenne Avenue and Marion Drive in North Las Vegas. The 492,500-square-foot center is now 100 percent leased, Panattoni manager Ben Campbell said.

SOUTHWEST GAS: United Construction has been awarded a $14.1 million contract to build an operations center for Southwest Gas Corp. at Centennial Parkway and Shatz Street in North Las Vegas, said John Woods, division manager for United.

The project consists of two concrete tilt-up buildings totaling 102,000 square feet on 10 acres near Las Vegas Motor Speedway. A storage yard and outdoor living demonstration area will also be built.

Upon completion in April 2009, the Southwest Gas facility will have about 400 employees.

BROKER DEALS: Soozi Jones Walker and Bobbi Miracle of Commercial Executives negotiated a 36-month lease of 1,380 square feet at 2911 N. Tenaya Way for Dr. Simon Farrow. The lessor is Kester Tujungas Apartments and CR Dickens. The transaction is valued at $82,323.

Scot Marker and David Grant of Colliers International represented Spring Oaks Shopping Center, 4711 Spring Mountain Road, in the 60-month lease of 4,780 square feet of retail space to Yi Properties. The amount of the lease is $791,783.

John Knott and Michael Parks of CB Richard Ellis represented JGM in the sale of the Econolodge at 1150 Las Vegas Blvd. South for $5.8 million.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.