John Blackmon is cautiously optimistic about Nevada’s economy avoiding a recession, when he looks at the trends in development, financing and mortgages.
“A general slowdown is probably the correct way to describe what is happening right now in the local market, and we are still seeing new projects breaking ground on nearly every corner,” said Blackmon, manager and owner of NV Capital Corporation. “I believe that the trend will stay steady.”
Blackmon discussed with Vegas Inc the prospects of a real estate bubble, affordable housing and the challenges developers face today.
Tell us about your career path and what brought you to your current position? In 1987, my family and I moved to Nevada to work for Nevada National Bank, which was soon to be purchased by Security Pacific National Bank. I stayed with that bank until 1992, when I decided to pursue the local community banking world. Community banking was much more enjoyable to me, as I have always been a people person and generating business was what I wanted to do.
A variety of my customers in the Las Vegas Valley were involved in the mortgage broker business, so it was very familiar to me. I found it interesting that when I applied for my mortgage broker license, there was no one in the approval process who could ever recall a banker wanting to be a mortgage broker.
Do you have any recent news or updates you’d like to share? We have an application to open an office in Reno to better serve the customers of the northern part of the state as well. As we embark on new ventures and deals in other parts of Nevada, having a Reno office makes sense for us to be closer to both our client and investors, as well as new projects. It’s exciting to be covering both sides of the state as we work to expand our portfolio for investors.
Do you see another real estate bubble in Vegas’ future? I certainly do not see a bubble. There is so much equity in the current real estate market that I do not see a major crash in prices. The last bubble was clearly fueled by easy money, and there were many loans that were written with as little as 5% down payments. For the most part in the past several years, we have gotten away from that.
What are the biggest challenges a developer faces today? There is a shortage of certainty. By that I mean a shortage of materials, labor and tenants for commercial projects. Developers have a hard time knowing which rent amounts they need to charge when they cannot pencil out the exact cost of a project. Sure, you have the glamorous projects, such as those taking shape near our office off Durango and the 215. But the generic development projects may be a bit too speculative for most developers.
If you were king of Las Vegas for a day, what’s the one thing you’d do to improve the community? Somehow fix the traffic/construction projects going on here. There are road projects and sewer connect projects and road-widening projects, and sometimes it seems that the cones and barriers stay up even when there are no visible workers anywhere in the area.
What can be done or is being done to address the shortage of affordable housing in the Valley? Not sure that much can be done here. Las Vegas has always had an income issue for the average workers and they have never been able to purchase a house, even with two incomes. Assembling a down payment is just too difficult.
What is your dream job? If this is a hypothetical question then my hypothetical answer would be a golf pro. When I moved here I couldn’t even spell golf, but once I learned how to play, it has provided me with a lot of enjoyment and I have met some amazing people on the course.
Whom do you admire and why? I admire anyone who has put service before self in our society. School teachers, firefighters, police officers—they have my utmost respect.
What do you see happening in the industry over the next six months? We will continue to see Las Vegas grow, which means we will need more housing, office space and retail space. While we are in a slowdown, I believe that there will be a boom shortly.
What is something people might not know about you? In 1987 and 1988, I spent time in the Far East helping organize a new bank in Cambodia. That gave me a different perspective on how really advanced the U.S. economy is.
What is the best business advice you’ve received? “Always tell the truth, even when it is not in your best interest.” That was from my father.
What’s the most challenging aspect of your job? Keeping everyone happy! Borrowers, lenders, employees and service companies all want to compete for time with the boss, and it is a balancing act to keep them all happy. The most difficult aspect for sure is when it is time to call a loan due and the borrower wants to keep on going. That is where we earn our money.
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