I paid my deposit back in November of last year. First shot was
given to the
Maloofs, their friends and family, certain sports professionals
(the
Sacramento Kings?), and selected casino VIPs. The last,
apparently, would be me!
Guess you're not as Exalted as you believe (what a shock!).
Boy, some people are irony-proof, aren't they? Obviously my intent
was to convey that the "advance status" supposedly conferred by my
Club Palms membership was nothing special, given that (as you say)
the true inner circle had the real first crack at the prime units.
The notices sent out
in 2005 were to almost anyone in any way connected with the
Palms, nickel players included! 
If this notice fails to sell
all the units, then the "public at large" will be invited. Big deal!
If these units are worth buying (and my previous post indicates that
I don't think they are), then having any kind of preferred selection
WOULD be worth something, given that only half the units (or
thereabouts) will have a fabulous view of the fabulous Strip in
fabulous Las Vegas. Others will have an excellent vista of the
Chinese restaurants on Spring Mountain Blvd.
As part of the first group, I got
first choice of units, plus a discount on the (admittedly high)
price.
Did they say what percentage or amount discount you would be getting
vis-a-vis the public offering price? I would think that if it was
significant, then anyone interested would have simply joined the
slot club to get in the "advance" group....
My deposit is in an interest bearing account at Wells Fargo. I
get monthly statements. The company is Stewart Title, a pretty big
title company here in LV. The balance of the down will be due in May
or June of this year. Projected occupancy is spring, 2007. Up until
the down payment is due, my deposit is refundable at any time (have
that in writing), including accrued interest.
Will you also receive interest on your down payment between its
posting and closing of escrow?
Will Maloof (Palms, Inc./whomever) warranty the completion of the
units by a certain date? Do the depositors have any remedies if the
project is not completed on time?
Will you be able to treat your condo as real property, specifically,
do you have to use it as YOUR residence, can you lease or rent it
out, etc,?
聽聽
Since the title company is acting as Trustee for the deposit
monies, the> Maloofs have no control over it. I believe that this is
SOP.
Since the project will be financed by cash flow, what would happen
if some unforeseen event (like 9/11/05) cut that cash flow? It would
seem to me that the Palms will be severely illiquid in any case, and
might very well be overextended if something happens to even
temporarily stem the rising tide of Vegas visitation. Don't forget
that at the same time, they will be building a new hotel tower as
well.
Is Maloof prepared to release financials to those investors (for
that's what they are) who commit to buying a condo?
Since this is an insane price to pay for a pied-a-terre or a place
to crash when visiting Vegas, the only people who would be buying
these units are 1)potential fulltime residents and 2)speculators. I
actually spent a fair amount of time last spring researching the
high-rise luxury condo market in LV, with the thought that buying
into one of the upcoming projects might actually be a good
investment. I noticed that a LOT of the listings of never-occupied
units (i.e., those bought to be flipped by speculators) were staying
on the market for months. The thing is, unless you have a condo itch
that needs scratching TODAY, why would you pay a 30% markup to some
investor, when there is so much inventory coming on the market in
the next two years? I foresee a glut in the luxury high-rise condo
market in 2007 as all the investors list their prepaid condos in an
attempt to recoup their money, which has been tied up in these
projects, not earning any kind of return. This will depress prices
and obviate any benefit gained by buying early on spec.
But you want to know the absolute KILLER? The HOA dues!! At several
properties, for condos in the $500K selling price range, the HOA
fees ranged from a low of $728/mo (!) to a high of $1745/mo (!!)
This is going to make HRL condos a LOT less attractive when people
realize that they're paying $30/day just to have an obsequious
doorman handy and to clean their 1/300th of the swimming pool. And
the exercise room better have DAMN fluffy towels for that kind of
dough!
This is not to say that these condos might not turn out to be an
excellent investment. Its just that it's considerably more of a
gamble than the promotional literature might bring you to believe.
I'd say, if you can afford to have $100,000 disappear, or be tied up
for years, go for it. Just remember that Maloof/Palms is NOT a
publicly traded company, and their financial health is NOT
measurable. And you can't go by the apparent success of the existing
Palms property--how many large, seemingly robust companies have
imploded in the space of a week, with no warning and depriving
everyone but the lawyers of all of their investments?
It's a basic tenet of doing business that if you want to attract
investors (and that's what the condo purchasers ARE), you have to
provide full financial disclosure. The fact that Maloof/Palms isn't
doing so, is something I would find a little scary.
Any questions? Opinions offered by QUALIFIED real estate folks are
welcome!
Brian
Obviously you won't consider me "QUALIFID real estate folks", but I
do know a lot (more than I care to) about the LV real estate market.
Getting into the LV market now is like learning to count cards in
2003, or reading "The Frugal Gambler" and hitting the machines in
2004. The train has left the station s long time ago IMHO. Your
mileage may vary.
路路路
--- In vpFREE@yahoogroups.com, bjaygold@a... wrote: