Town Square debuts but in less-than-auspicious times

Clark County’s taxable sales fell 5.2 percent in August when compared with the same month in 2006. Job growth in the Las Vegas Valley was crawling along at 1.4 percent in September, down from 4.3 percent a year earlier. The county’s annual population growth dropped by nearly half between July 2006 and July 2007, from 5.3 percent to 2.7 percent. And a faltering housing market, with its price depreciation and slumping sales, has unnerved consumers.

But Turnberry Associates and Centra Properties will take a chance on that market today, when the partners open Town Square at Las Vegas Boulevard and Sunset Road.

Mike Wethington, Town Square’s general manager, said he believes the center will thrive despite a soft business and real estate market.

“We’re always concerned when there’s a turn in the economy,” Wethington said. “But because we’re so unique and different to Las Vegas, I think we are going to get a good crowd of people who want to dine with us and shop with us.”

Local analysts agreed that a slower local economy wouldn’t necessarily hurt Town Square’s prospects.

Kit Graski, a senior vice president specializing in retail with Voit Commercial Brokerage in Las Vegas, said Town Square’s location on Las Vegas Boulevard near the center of the valley will give the property a diverse customer base that will help it do well in down times. Because it’s not a grocery-anchored neighborhood center at the city’s outskirts, Town Square isn’t especially reliant on housing and population growth, and a healthy sprinkling of tourists staying in nearby hotel-casinos on the Strip should supplement traffic at the center, Graski said.

A penchant among consumers for seeing the latest and greatest major developments should also spur solid traffic to the center, added Brian Gordon, a principal of Applied Analysis, an economic research firm in Las Vegas.

Town Square’s developers have identified three primary customer streams for the development.

Wethington said he expects the center to draw consumers from across the valley because its location at the confluence of interstates 15 and 215 positions it within a 15- to 20-minute drive from all corners of the city. Town Square should be especially popular with residents in southwest Las Vegas, because the area doesn’t yet have any regional malls, Wethington said.

The tenants who will occupy the 350,000 square feet of office space at Town Square will provide a second key source of patrons at the center.

“The office space puts customers here all day long, Monday through Friday,” Wethington said. “A lot of the office employees will be dining at the restaurants in Town Square every single day of the week, so you have a built-in customer.”

Plus, Town Square officials expect to convert tenants’ visitors into customers, Wethington said. The company has signed up the 7,000-member Las Vegas Chamber of Commerce as a tenant, and is hammering out leasing deals with other local businesses.

Finally, Turnberry executives are talking with the Las Vegas Convention and Visitors Authority about how to lure out-of-town sightseers to Town Square. They’re also slating lunches and promotional events for taxi drivers to inform them about access to Town Square, and they’re meeting with resort concierges to get on must-see agendas.

Graski, who represented Borders Books & Music in its lease at Town Square, said it’s reasonable to expect customer traffic from Strip tourists. After all, the Las Vegas Outlet Center, formerly Belz Factory Outlet World, does brisk tourist business at Las Vegas Boulevard and Warm Springs Road, he noted.

But existing shopping centers on the Strip, including the Forum Shops at Caesars, the Miracle Mile Shops at Planet Hollywood, the Grand Canal Shoppes at The Venetian and the Fashion Show, could make it difficult for Town Square to scoop up many out-of-towners, Gordon said.

“Certainly, there’ll be a visitor component that will be intrigued by the project, but it’s competing with several million other square feet of retail offerings on Las Vegas Boulevard,” Gordon said. “That’s tremendous competition for (Town Square).”

Both Graski and Gordon said Town Square could siphon shoppers from existing shopping centers off-Strip, but the effect shouldn’t be dramatic. That’s because parts of the valley, especially the southwest, are under-retailed, so there’s room for a new offering.

“The pie is expanding,” Graski said.

Nor does Wethington expect to put any existing centers out of business.

“There’s absolutely room for all of us, because we’re bringing something different to the valley,” he said.

The only potential hurdle Graski sees is Town Square’s soft opening. With just 40 of its 150 stores opening today, consumers who drive in from suburban markets such as Summerlin or the far northwest could find the offerings too limited, and decide against making the longer trek again anytime soon. An eclectic retail mix and the upcoming holiday shopping season could mitigate the effects of a limited launch, he added.

Town Square officials expect to have the entire shopping center open by spring.

Despite the challenges — economic torpor and an incomplete build-out — Town Square’s long-term outlook is bright, Gordon said. The downturn is temporary, and should start to reverse after a new wave of megaresorts begins opening this winter.

“Establishing their brand and their product now is important, and as the overall economy picks up, projects such as Town Square will be poised to take advantage,” Gordon said.

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or (702) 380-4512.