With 5,000 people moving here each month, somebody had to spill the beans!

Whew — Glad I Didn’t Invest in Newport Lofts in Downtown Las Vegas!

In episode 65 of the Living in Las Vegas Podcast, we did a show title, Living the Loft Lifestyle in Las Vegas.  In it, we featured three loft projects in the Las Vegas valley, one of which was Newport Lofts.  For those who remember the show, I was pretty impressed by the property.

Good thing I wasn’t too impressed.

At the time of the episode (February 2009), their entry-level studio loft (at about 912 square feet) was being offered at $199,000. . .which seemed reasonable considering they were once priced MUCH (2x I believe) higher.  I thought so highly of the Newport Lofts that I seriously considered purchasing one as a business investment.

Good thing I didn’t pull out my checkbook.

When I checked back with the website about two or so weeks after the show, the price for that studio loft had dropped an additional $20,000.  In two weeks.  And while that was psuedo-good news, it spooked me a bit as well- – -enough so that I decided against moving forward.  (There were other reasons as well, to be sure.  But the price dropping that much seemed a bit ominous.)

Good thing I spook easily.

I just saw today that 20 units (out of a total of 168) are being auctioned off, with a starting “reserve” price of. . .get this. . $90,000.  Can you imagine if you had invested in that property in February. . .or before?!? 

Yikes.

I wish I knew more about real estate and how to truly measure the soundness of a property like Newport Lofts.  Truth is, the potential of that property, with its amenities and location, seems very good.  But clearly, there’s more to it than that.

For those interested in the auction, here’s their flyer announcing the event [pdf].  It’s being help on August 29, 2009 at 3PM at the Renaissance Las Vegas Hotel.  (Wonder why they wouldn’t have the auction at the Newport Lofts?)

If I owned that entire property, I would look into converting it (or allowing for) commercial activity.  They would have to address the parking issue, but with those types of prices, imagine how quickly small business folks would snap those properties up.  It would great for artist/creative folks. . .and others as well.

Regardless, I sure hope this property makes it.  It’s beautiful and very well situated, just a few blocks south of Fremont street. 


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Comments

7 Responses to “Whew — Glad I Didn’t Invest in Newport Lofts in Downtown Las Vegas!”

  1. Ted Newkirk
    July 31st, 2009 9:26 pm

    These kind of auctions have been happening in Florida for quite some time. Reference:

    http://pcbdaily.com/?cat=561

    With the investor market really picking up, what happens is that these places often go for much more than the reserve. The condo builder finally gets to close the thing out and salvage as much revenue as possible.

    At the end of the day, I’d use condo resale comps to figure out what price points are good. Pretty much every condo in town (high rise or not) has a ton of resales listed. Good way to find out what the market will bare.

  2. JR
    August 6th, 2009 4:03 am

    I agree. Low reserves are here to get you down to the action in big numbers then the price will be much higher….. I saw 900 sf for about 160000 in this building. (so from 190000 down to 160000) is already bad for just 6 months…
    JR

  3. ScottW
    August 6th, 2009 5:59 am

    I’m not completely sure, but a few months ago, I believe a unit sold for $150k.

  4. ScottW
    August 6th, 2009 6:00 am

    I guess my question is, why would anybody buy a unit at all in a building so clearly at risk?

  5. JR
    August 10th, 2009 5:26 am

    Scott,
    C2 lofts near Red rock casino is now 360000.- for 2400 sq Much nicer area… :-) I would buy one if I would know that i have a longer project in LAS.

    Downtown I would only buy if you think the upgrade projects will be successful from Wynn and other, just not so save at night…..
    Don’t know how schools are in that area…..
    jr

  6. Bob Evans
    January 18th, 2010 10:47 am

    What do you mean by “a building so clearly at risk?” At risk of what happening? So you buy a unit there for 150k. Whats the worst that could happen?

  7. ScottW
    January 18th, 2010 10:50 am

    Bob: You could lose $150k because the building itself cannot sustain itself because enough people aren’t paying HOA dues (which are at least $500) OR the surrounding area fails to improve placing downward pressure on your investment.

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