The Troubles Facing Nevada's Master Planned Communities
"Planned communities have long been part of Southern Nevada's landscape, fueled in part by BLM auctions of federal land. Developers of Park Highlands, led by the Olympia Group that paid $639 million for 2,675 acres in November 2005, plan to build nearly 16,000 homes once they emerge from bankruptcy protection, their attorney Richard Holley said May 11.
The master-planned communities are paying the price for the sharp drop in demand for new homes. In 2006 at the end of the building boom, 35,406 new homes sold, but that dropped to 19,446 in 2007 and 9,965 in 2008, according to SalesTraq. Through this year's first quarter, 1,105 homes closed, putting the region on pace to have fewer than 5,000 new-home sales by the end of the year.
Despite these sluggish sales for new homes, planned communities are taking a bigger chunk of the overall sales than a year ago.
In 2008 only 45 percent of new-home closings were in planned communities, including 42 percent in the first quarter. In this year's first quarter, 54 percent of the closings were in planned communities - typically defined as large tracts under the control of a single developer and select homebuilder partners."