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Gaming Guru

Chris Jones
 

Mall Owners to Showcase Changes

22 February 2005

LAS VEGAS -- With the first of several major changes now complete, the owners of Las Vegas' Showcase mall plan to further shake up the 7-year-old Strip property with an influx of new tenants and dozens of full-time residents.

San Francisco-based City Center Retail and partner Angelo Gordon & Co. of New York two weeks ago acquired Showcase and an adjacent three-quarter-acre parcel from Henderson-based Makena Development Corp. and Forest City Enterprises of Cleveland.Advertisement

Mark Stefan, a City Center Retail principal, said Monday that the new owners will add 75,000 to 80,000 square feet of retail space, and up to 80 luxury condominium units, at the site of an existing Denny's restaurant north of the 190,000-square-foot mall.

"It's an excellent location," said Stefan, who believes Showcase's existing tenant mix will attract new retailers to the expansion. The center's position directly along Las Vegas Boulevard South should also lure potential condominium dwellers, he added.

"It's one of the few residential projects that is right on the Strip," Stefan said. "A lot of the other (announced condominium) towers are set back, but this is (ideal) for somebody who wants to be right in the center of things."

Stefan said City Center is in the early stages of marketing the expansion, which should begin construction later this year. Upon build-out, Stefan estimated, the center will be worth approximately $250 million.

Clark County Assessor records show City Center paid $142 million to acquire Showcase, which also includes a multi-story parking garage.

Located in front of MGM Grand, the $94 million Showcase project opened with the December 1996 debut of the Original All-Star Cafe, a now-defunct eatery whose owners included basketball star Shaquille O'Neal and local tennis star Andre Agassi. Other tenants soon followed, including World of Coca-Cola, United Artists Theaters and the GameWorks video-game arcade.

More recently, shoe retailer Adidas opened a 20,000-square-foot Adidas Performance Centre at Showcase in July.

City Center Retail previously developed and sold a pair of smaller Strip retail centers, most recently the nearly 38,000-square-foot Silver City Plaza at Convention Center Drive. That project, which includes a Ross Dress for Less store and Denny's, opened in the fall.

Stefan said Silver City Plaza was sold in December to Passco Real Estate Enterprises of Irvine, Calif., for approximately $38 million; county records list a February sale valued at more than $42.4 million.

City Center Retail also developed the Gold Key Shops, which are one block south of Silver City Plaza. That project, whose most notable tenant is a Starbucks coffee shop, was sold to a Los Angeles-based investment group in September 2003 for $21.6 million, county records said.

Despite those past turnarounds, Stefan said his group does not plan to quickly cash in on its latest Las Vegas investment.

"We like the market a lot and think growth is going to continue," Stefan said. "We're going to hold onto this one."