NAI Horizon reportedly leased 14,000 sf—room for a lot more than 30 brokers--at Marnell Corporate Center a couple of years ago. Other brokerage firms in town, ones that were outperforming NAI Horizon, also were expanding at the time, but not in such a big way. Moreover, local industry sources say NAI Horizon didn't appear to be adding many brokers to help increase revenue.

"I was thinking at the time, there is no way, based on the people they had, that they would be able to make it," according to one source. "When I heard they were going (away) I was not surprised. They've been operating in the red for some time."

NAI Horizon is owned by John Bozzo, president of NAI Horizon; Karlene Politi, president of property management for NAI Horizon; and Reginald Winssinger, chairman of the company. Terry Martin-Denning, VP/COO of NAI Phoenix, who was responsible for running both the Phoenix and Las Vegas offices, confirmed that, indeed, ownership has had to cover costs in Las Vegas.

"We saw a huge downturn compared to the activity we are continuing to see in Phoenix," she tells GlobeSt.com. "The Las Vegas office was requiring cash resources [from the ownership] to basically keep the doors open."

In NAI Horizon's best years in Las Vegas, it brokered a lot of land sales along with office, industrial and retail deals. Last year the retail segment in Las Vegas was still strong, Martin-Denning says, but in 2008 the entire market is soft.

"My expectation is that no one is doing well [in Las Vegas] at this point and it's 'wait and see,'" she says. "Everybody believes it will rebound at some point; our group simply decided it couldn't wait for the rebound."

Thad Seligman, president of brokerage at NAI Phoenix, says the Las Vegas market has slowed significantly in terms of both velocity and activity over the past year, in large part because the Vegas economic base is so centered on the hospitality and gaming segments. "The office, land, investment and industrial markets have been an increasing challenge there, and will continue to grow more difficult under current market conditions," he said. "When you add to that the tightening of the capital markets, we felt it was important for us to focus our energy and resources on the Phoenix market, which has a much broader and deeper economic base than we see in Las Vegas, and is going to be able to ride more evenly through the current slowing economy."

While the managers of commercial real estate firms here agree the Las Vegas market is in a downturn, not everyone agrees with Seligman and Martin-Denning about the severity of it or that Phoenix will outperform it in the near term. Frank Gatski of Gatski Commercial, a longtime local company whose biggest piece of business is property management and, therefore, has been less affected by slow deal flow, tells GlobeSt.com that things aren't as bad as they might seem.

While he acknowledges that investment deals have slowed and that he's seen a slowdown on the leasing end because people aren't excited about opening new offices or expanding in this economy, Gatski adds that deals continue to get done, that the major brokerage firms in town aren't shutting down, and that there is hope of a near-term turnaround. He does not believe the Phoenix market is a stronger commercial real estate market than Vegas, but says it may have been for NAI Horizon's operations.

"I think they are having to tighten their belt and they were stronger in Phoenix than in Las Vegas; I think we will see consolidation like that throughout the country," he says. "It certainly has been a gravy train for some time and this is a bit of back to reality. Hopefully we'll come back somewhere between the gravy train and where we are today."

Joseph Kupiec, managing director of the Las Vegas office of Grubb & Ellis, tells GlobeSt.com that his firm expanded at around the same time as NAI Horizon, but by a smaller amount. "There may be perhaps [other closures] by smaller operations but we are hanging in there and are still optimistic for a turnaround in the third quarter. Las Vegas has some issues as do other markets, but we are more resilient; we start coming out more quickly than some other areas of the country."

CB Richard Ellis' local managing director Craig Shute agrees. He tells GlobeSt.com that Las Vegas is no different than anywhere else in being affected by the broader economy, "but I would argue that we will bounce back more quickly than anybody else because of the $30 billion of construction activity on the Las Vegas Strip."

Shute says his office is doing "reasonably well" despite the market conditions and that NAI Horizon had some quality brokers that were doing well and had good years in 2007. "Capital markets are making investment difficult but there are still deals being done and the market, for all intents and purposes, is bubbling along relatively well," he says. "If you are representing well-located properties you are still hanging in there pretty well from a brokerage standpoint. I don't want to speak for why [NAI Horizon] made their move, but I believe it may have been more of a structural thing, rather than the brokerage market. The fact that NAI Global wants to continue on here kind of contradicts their story."

Indeed, Blanchard says that by hunkering down and continuing operations here the new NAI Las Vegas will prosper. The new office space has room for an additional six brokers beyond the 11 coming over from HAI Horizon. Blanchard says he will be looking to fill those spots with quality brokers.

"The market is important to us, we believe in it and we already think it is turning around," Blanchard says. "I don't want to sound crazy, but we are seeing an increase in transactions; it's not as bad as it was and we think it may even be starting to thaw a little bit. People and corporations need to expand, contract, acquire and/or dispose of real estate space and given enough time and pressure...they will find a way to do it."