International Jet Set Settles in Vegas
By Buck Wargo
Come to Las Vegas for a convention or vacation and leave owning part of the Strip or another piece of the city’s real estate. That’s the pitch that our realtors at the highest level are giving rich foreign investors, who are visiting Vegas at a soaring rate.
For reasons as varied as strong foreign currencies and our recently diversified entertainment options luring a new clientele, the Las Vegas metro area saw a staggering 4.6 million international travelers in 2011. That’s a 92.4 percent increase since 2003, enough to put us in the number-one spot among major American metro areas for gains in international travel, according to the Brookings Institution’s Metropolitan Policy Program. “It’s no longer enough to rely on domestic visitors,” says Adie Tomer, a senior research associate with Brookings. “But if you can tap into the international market, from Shanghai to São Paulo to London, you can bring more economic growth back to Las Vegas.”
International visitors are important to the market because they tend to stay longer and spend more money than American visitors. The Las Vegas Convention and Visitors Authority has a goal to increase the percentage of foreigners visiting the city from the current 16 percent to 30 percent by 2020, and last summer McCarran opened a new $2.4 billion terminal, mostly for international flights. The ability to attract travelers from around the world gives Las Vegas financial security, especially when the domestic economy is feeling less secure. This means more people to fill hotels, showrooms, and casinos—and to boost the real estate market. “That’s a lot more people who can buy real estate as an investment or move here,” says Tomer, who recently led a research project on international air travel to and from America’s largest metro areas. “These visitors are from higher-income families.”
In 2011, 42 percent of international travelers to and from Las Vegas came from and returned to Canada, followed by Western Europe at 27 percent. Next were Latin America and the Caribbean at 19 percent and Asia at 7.4 percent.
Among cities, Toronto led with 470,478 passengers, a 110.7 percent increase since 2003. One visitor from Toronto was Roni Aharon, who came to Las Vegas in 2009 to attend a convention.
Once here, however, he decided to rent a car and drive around, on- and off-Strip, to find out if the stories he had heard of the American real estate crash were true. He now owns or co-owns dozens of rental properties in the city, including high-rise units at Newport Lofts, Turnberry, and Panorama.
“When I was in town for the convention, I started snooping around and was intrigued about what was happening in the real estate market,” says Aharon, a general manager of an event presentation company. “Some of what I spent on one property in Vegas couldn’t buy you a garage in Toronto.” That’s because he focused on foreclosed properties: Some condos that had once sold for $500,000, he bought for $100,000.
Meanwhile, Korean Air’s nonstop route between Seoul and Las Vegas contributed to one of the largest ever increases in our international tourism. Currently the 12th most popular international city of origin and return for visitors here, Seoul delivered 9,971 travelers in 2003 and 78,414 last year, an impressive 686.4 percent increase. Another interesting fact from the Brookings report: São Paulo comes in at number 14, with a 456.8 percent increase in visitors since 2003—despite having no direct flights to Las Vegas.
Shari Sanderson, a real estate agent with Award Realty, says more than half of her business comes from customers from Canada, Israel, China, and Australia. They have bought property at Mandarin Oriental, Trump Towers, Panorama, and other high-rises.
“Everybody wants to own a place in Vegas, and they can’t believe the prices are so low,” Sanderson says. “They start off buying for themselves, and then start buying to rent them out.” That’s what happened to Jeannie Neill and her husband, Tom Lanny, who live in Sydney, Australia, but also have a home in Santa Monica, California. Neill says she learned about the real estate opportunities in Las Vegas from a TV program in Australia. So, after ringing in 2009 on the Strip, the couple looked at foreclosed high-rise properties and ended up buying a unit for themselves at Panorama Towers and later two more as rental units. Their 2,400-square-foot Las Vegas residence, which once sold for $1.2 million, cost them $250,000. It has a view of both the mountains and the Strip.
“We came in to celebrate New Year’s and to see The Beatles LOVE, and we ended up buying that day,” Neill says. “It was an amazing opportunity.”
photography by bryan hainer