Land sale in Vegas to bypass public auction
LAS VEGAS (AP) – Critics say the proposed direct sale of land by the federal Bureau of Land Management to a Las Vegas developer is a sweetheart deal that could have netted the government more than twice as much.
The agency confirmed to the Las Vegas Review-Journal last week that it would sell a three-quarter-acre vacant lot for $546,900 to Randy Black Jr. based on a real-estate appraisal performed 16 months ago.
Experts told the paper that there is too long of a lag between the valuation and sale.
“In a changing market like this, six months can easily be too old. I’ve seen lots in only nine months go up 50 percent or higher in value,” said professor Mike Clauretie of the Lied Institute for Real Estate Studies at the University of Nevada, Las Vegas.
Veteran real estate brokers say the vacant lot’s 465 feet of frontage along Durango Drive, a major arterial road along commercially zoned property, means that it could easily fetch $1 million to $1.5 million in open bidding.
“A fast-food restaurant (chain) would pay $30 a square-foot for this site. He’s buying it for about half price,” said a broker who has bought and sold commercial land in Las Vegas for 25 years. “Frontage along Durango is worth a lot of money. This is a sweetheart deal.”
“That’s a great site,” a second broker said. “If I got this from the BLM at this price, I could have a contract to sell it for twice that in a heartbeat, and I’d love to. It could bring a lot more than that. They’re throwing money away.”
The brokers spoke on condition of anonymity because they intend to conduct future land transactions with the BLM and fear being frozen out for criticizing the agency.
BLM officials confirmed they intend to skip the standard competitive bidding process next month and sell the property to Black.
They blamed the delay between appraisal and sale on a slow-moving government bureaucracy.
“It took a long time for this to get pushed through Washington,” said Shawna Woods, the BLM realty specialist who oversaw the proposed deal.
Federal law allows the BLM to sidestep the auction process in rare instances, and the officials said this case fits the bill.
They also said the odd, triangular shape and size of the lot makes it useless to anyone else besides Black, who, according to documents filed with the city of Las Vegas, intends to assemble it with adjacent lots he owns and develop a 23-acre medical office and retail complex on the site.
“This property wouldn’t benefit anyone other than Mr. Black and his proposed use of the property,” said BLM Assistant Field Manager Sharon DiPinto.
According to a BLM memo, a direct sale can be authorized when a parcel “is an integral part of a project and speculative bidding would jeopardize” its development.
Local BLM officials say Black’s proposed office complex meets this condition.
Black, the son of Mesquite casino operator Randy Black Sr., owns the adjoining property on two of the lot’s three sides, and a Department of the Interior appraiser concluded that the “best use of the site would be for assemblage with the adjacent property controlled by Mr. Black.”
DiPinto disagreed with the brokers’ assertion that the site was large enough to be marketed to a restaurant chain.
“You’re going to have setbacks, where you’ll have a little less than a half-acre to construct on,” she said. “After you put your setbacks and access in, to me, I think it would be cumbersome to try to use that.”