Las Vegas' Largest Residential and Commercial Appraisal Firm Says Commercial Appraisal Business Booming Even as Residential Market Continues to Struggle
Las Vegas commercial appraiser Don Foster Scoggins of AppraisersofLasVegas.com, Las Vegas' number one appraisal firm as rated by In Business Las Vegas, said the commercial real estate market in Las Vegas is booming even as the city's residential market continues to tread water.

/Nevada News Articles/ - LAS VEGAS, NV, October 07, 2007 - AppraisersofLasVegas.com tracks Las Vegas commercial appraisal and development trends on its corporate website. The data show a clear undercurrent of busy commercial investment and development in Las Vegas.

"Population and tourism growth lead to increased investment like night leads to day," Scoggins said. "We keep tabs on the most critical data on the Las Vegas Hotel and Motel Market, the Las Vegas Industrial Market and the Las Vegas Office Market, and the data are all as robust as the Las Vegas residential market is still moribund."

These trends led Fitch Ratings to rate Las Vegas' upcoming LTGO bonds 'AA' with a stable outlook, Scoggins noted. The investment ratings firm highlighted generous gains in assessed values in Las Vegas. "Between fiscal years 2003 and 2008, AV increased over 18% on average annually, growing 30% and 33% in fiscal years 2006 and 2007, respectively. Fiscal year 2008 saw slower AV growth of a still strong 12%," Fitch Ratings reported. The deceleration in growth is attributable to the slowdown in the residential market as opposed to commercial, Las Vegas appraisal experts say.

"An office employment boom has led to a spike in speculative multi-tenant projects in Las Vegas," commercial appraiser Arthur F. Nelson, MAI, RM, also with AppraisersOfLasVegas.com, said. "As vacant square footage is absorbed, Las Vegas' commercial appraisers are seeing a strong market continue."

Las Vegas commercial appraisal continues to show growing construction and leasing activity and shrinking inventory. The Federal Reserve's "Beige Book" report for the district including Las Vegas noted the city's strong commercial market in assessing the overall real estate economy over the summer. "Most contacts from this sector expect further sales declines in coming months, due in part to more restrictive credit standards and higher interest rates for residential mortgages," the Fed reported. "By contrast, construction and leasing activity for commercial and industrial space grew further and vacancy rates have reached low levels in some cities, most notably Los Angeles and Las Vegas."

Scoggins notes a national boomlet in office and industrial property, and according to the commercial appraiser, Las Vegas is right in the thick of the activity. "Office buildings were going for $130 a square foot as late as 2002, and 2006 saw that price rise to $225 nationally," Scoggins said. "Industrial property is up 50 percent over the last two years."

Industrial development in Las Vegas turns on the difficulty of finding comparable development solutions outside the city. Speculative industrial development hit a record in 2006 and rental rates are continuing to climb, Scoggins said.

No discussion of Las Vegas commercial appraisal is complete without noting the robust nature of its hotel and motel market. AppraisersofLasVegas.com observes that the number and scope of new hotel and motel developments demonstrates the strength of the Las Vegas commercial market and its size and sophistication. "A greater national acceptance of gaming, several new theme hotel casino developments, population growth and stable and affordable fuel prices have contributed to record tourism and taxable sale increases in Las Vegas," commercial appraiser Scoggins said.

The driver to all of this is population growth. Scoggins noted that Las Vegas' 28 percent increase from 2000 to 2006 made it the fifth fastest growing U.S. city. "Las Vegas commercial appraisal is as hot right now as many markets' residential appraisal is slow," Scoggins noted.

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