The sale of a prominent Strip shopping mall is proof, one local real estate professional said, that the smart money is now ready to bet on resort real estate in Las Vegas.
Boulevard Invest LLC, the owners of the Miracle Mile Shops at Planet Hollywood, confirmed Monday that the mall was sold to Institutional Mall Investors LLC. The sales price was not disclosed.
The 500,000-square-foot complex opened in 2000 as Desert Passage and became the Miracle Mile Shops when the Aladdin was rebranded as Planet Hollywood in 2007. It features more than 200 shops, restaurants and entertainment venues, including Axis Theatre, home to residency performers Britney Spears and Jennifer Lopez.
Josh Smith, vice president of hospitality and gaming for Sun Commercial Real Estate Inc. of Las Vegas, said the sale indicates that large investors are now less tentative about investing in Las Vegas.
IMI is owned by Miller Capital Advisory Inc. of Skokie, Ill., and CalPERS, the nation’s largest public pension fund. According to the news release announcing the sale, Miller has about $8.3 billion in real estate investments around the U.S.
"Las Vegas continues to set record visitor numbers, and that is certainly reflected in the traffic we see at Miracle Mile Shops," said Andrew Miller, president and CEO of Miller Capital Advisory. "The world-class mix of tenants appeals to a broad demographic, and we expect to continue to build on the mall's current success."
CalPERS is the organization that manages retirement benefits for public service employees in California.
“Here you have basically people who are in charge of people’s retirement, so they have to manage pension and health benefits, and when you’re playing around with someone’s retirement money you hope those guys are smart,” Smith said.
The Miracle Mile Shops is an especially good investment given its mix of shops, Smith added.
“If you’re on the Strip and you have the tenant base that supports the middle to upper-middle tier that is not supported as well as it could be on the Strip, that’s good,” he said. “If you can get that middle to upper-middle income base and have that type of exposure, that’s a strong play.”
While he wouldn’t speculate about the sale price, Smith points to a resurgence of interest in Las Vegas on the part of these significant investors.
“We’re starting to see smart capital come back into our market where they were cautiously optimistic before. … Either it was not looking or was cautiously looking at Las Vegas before,” he said.