The developer is Robert Zarnegin, president of Heritage-Nevada and Probity International Corp., a Beverly Hills, CA-based development firm. His exclusive negotiating agreement with the city for a 5.4-acre site in the 60-acre Union Park redevelopment district calls for him to have accumulated reservations for 25% of the planned commercial condominium space. At a press conference Thursday evening that included Mayor Oscar Goodman, project manager Bill Boyajian,who is a former president of the Gemological Institute of America, said 80 companies have signed LOIs to purchase just that much, 200,000 sf, and additional LOIs are in the offing.
The next month will be spent converting those LOIs into reservations, which would include a 5% down payment. In April, Boyajian told GlobeSt.com he expects a high conversion rate.
"The hard part is getting people in the industry--(people) who usually make commitments via verbal agreements and handshake--to sign on the dotted line, even a non-binding letter of intent," he said. "The good news is that while it is harder on the front end, it should result in a higher conversion rate than is normal. I'm hoping [to convert] 80% not 50%."
The development site is located near South Grand Central Parkway, W. Charleston Blvd. and Interstate 15. The most recent asking price for commercial condominium space in the development is $775 per sf with a minimum purchase requirement of 1,000 sf. Hearts On Fire and Tasaki Shinju are the latest companies to sign LOIs for the trade tower.
The residential portion of the project will include approximately 80 units on the top five floors. While most of the residential units are expected to be sold to people who also acquire commercial condo space, units will be available for purchase by the general public.
As for the retail center, thus far four companies have applied to open shops. They are Robert Wan Tahiti, Alan Friedman Designs, Chow Tai Fook Group and Dhamani Jewels.
Given the tremendous number of jewelry stores in Las Vegas, Boyajian says the goal will be to create a mix of retailers that will create a unique experience for locals and tourists alike. A committee will be formed to review applications. That said, Boyajian adds that the four that have applied are "great examples" of the kinds of companies that will be sought for the retail center.
The project was first announced in October with 10 companies having signed LOIs. By April, after an international presentation tour, that number of companies interested had grown to 60. To keep the LOIs flowing in, the project is now being presented at industry trade shows and other industry events both in the US and abroad. One of the draws is the fact that World Jewelry Center would be a Foreign Trade Zone, which means jewelry companies will be able to avoid customs fees on all imported goods until they enter the commerce of the US.
If the project meets the reservations goal as expected, the next step would be to negotiate a disposition and development agreement with the city. The tentative development timeline calls for work to begin later this year; project completion is slated for mid-2010.
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