The other Behringer-based project it is developing in the Las Vegas Valley is Alexan St. Rose, a 430-unit project on 26 acres located immediately northeast of the confluence of Maryland Parkway and St. Rose Parkway. That project also has been slated for completion in 2009.

TCR typically directs such developments in partnership with equity partners like Behringer Harvard. TCR acquires the property using equity from the partner while taking anywhere from a 0% to 10% equity interest in the project. It then handles the entire process, from governmental approvals through construction and lease-up. For its effort, in addition to development and management fees, it gets as much as 50% of the back-end profit from the sale of the stabilized asset.

TCR's equity partners are interested in Las Vegas because supply--due to condo conversions, demolition for redevelopment and population growth--has not been keeping up with demand for the last three or four years. And with tens of billions in resort development under way on the Las Vegas Strip, tens of thousands of new jobs are expected to be created in the coming months and years.

TCR's local project director Jeffrey Allen told GlobeSt.com in fall 2007 that condo conversions had taken 20,000 to 21,000 units off the market and redevelopment has taken another 6,000 to 7,000 units, raising occupancy in the remaining properties into the mid-90% range. At that time, Allen not only expected to achieve top-of-the-market rents, about $1.15 per sf, he expected to lease up the property much faster than the typical local standard of 20 to 25 units per month.

Vacancy has increased since then – average occupancy was 92.7% at the end of the first quarter, according to local data – and while asking rents have risen 1.8% in the past year to $888 per month, it is the slowest growth rate since the start of 2004.

Behringer Harvard's new project announcement comes on the heels of an apartment market forecast report by Hendricks & Partners that predicted that no new significant apartment properties would be delivered in 2009. The report said new apartment deliveries will slow to 2,300 units in 2008—from 2,725 units in 2007—and that the market would soak up approximately half of those units in the same year. For 2009, H&P predicted no new significant apartment deliveries and absorption of 1,600 units.

The H& P forecast predicts that apartment properties will continue to face significant competition in 2008 from condo rentals and single-family rentals and that the average apartment vacancy rate will remain elevated, settling at 7.5% by year-end. In 2009, H&P predicts stronger employment growth and an absence of new apartment deliveries will help drive the average vacancy rate down to 6.3%, while average rent growth will range from 2.0% to 2.5% over the forecast period.

In May , Behringer Harvard bought into Alexan Prospect, a 400-unit TCR development in Central Platte Valley, a 120-acre former industrial area immediately west of the Denver CBD being redeveloped into a mixed-use urban neighborhood. Behringer Harvard Multifamily REIT I, in partnership with a Dutch pension fund, acquired a 50% stake in the $95-million project, which according to SEC documents is expected to provide all partners a preferred return of 14%.