June Vegas luxury sizzles: $25M record-breaker; local BHHS goes corporate

ARTICLE FROM: LAS VEGAS REVIEW JOURNAL

It will be a June to remember for Las Vegas luxury real estate.

While the luxury real estate market remains hot with some of the top sales in Las Vegas history in June and annual marks about to be shattered, the activity continues to pick up with more brokerages trading hands.

The latest deal announced Wednesday has HomeServices of America Inc., a Berkshire Hathaway affiliate, announcing it has acquired Americana Holdings, the Las Vegas-based brokerage franchise of CEO Mark Stark. His franchise operated under the name Berkshire Hathaway HomeServices Nevada Properties, California Properties and Arizona properties.

It’s the second major transaction involving a major brokerage in the last year. Last fall, Synergy Sotheby’s International in Southern Nevada came under new ownership.

The brokerage sale, which takes effect July 1, culminates quite a month in Las Vegas real estate history.

Luxury records mark June

There have been custom homes built in the valley for their owners for a higher price than the $25 million but none that have changed hands, at least publicly on the Multiple Listing Service of the Las Vegas Realtors association.

That sale broke the all-time sales record in Las Vegas at $17.55 million when magician David Copperfield bought a home in 2016 on the so-called Billionaires Row in Summerlin. That transaction was handled by Realtor Ivan Sher with the Ivan Sher Group of Berkshire Hathaway HomeServices representing the buyer and seller. That sale wasn’t transacted on the MLS but was made public.

“Kristen should be super proud of this,” Sher said. “It’s a great accomplishment. She earned it and worked really hard. I had that moment and know what it feels like, and it’s incredible.”

The No. 3 on the list only came to light this month as a private transaction that the Las Vegas Realtors association said wasn’t completed on the MLS. Former casino mogul Steve Wynn’s home on Shadow Creek golf course in North Las Vegas sold in 2007 for $17.375 million but wasn’t reported at the time. The then MGM Mirage sold the 12,000-square-foot home, which it acquired from Wynn as part of the purchase of the gaming company. The home was sold when Wynn moved out after living there for several years.

In 2019, a newly built megamansion of developer Jim Rhodes sold for $16 million. It will now rank No. 4 with the Ascaya home sold in June at No. 5.

Las Vegas Realtors President Aldo Martinez said in the last 12 months when the city started to reopen from its shutdown from COVID-19 there have been more than 1,200 luxury closings of $1 million and higher single-family homes. For January through the first 23 days of June, there were 747 sales of $1 million and above. There were only 756 for all of 2020 when it comes to single-family homes.

“For the longest while we were about 200 to 300 luxury sales per year, and all of a sudden it started jumping,” Martinez said. “It looks like we should hit over 1,000 luxury home sales this year.”

There were 270 such sales in 2016; 385 sales in 2017; 430 in 2018; 531 in 2019; and 756 in 2020.

As for sales of $4 million and above, the Realtor association said there were 99 sales between June 30, 2020 and June 30, 2021. There were 51 sales for all of 2020. Five years ago, it was in the single digits for the year.

Sher said Las Vegas has gone from a place where high-end luxury sales were hovering around $10 million to $12 million and then reached $15 million before going to $17 million. With June’s record-breaking sale, there’s a new benchmark that shows luxury is changing in the city.

“It’s a huge moment for real estate in Las Vegas,” Sher said. “All of sudden now we’re edging toward some of those California coastal properties.

Sher said he’s talking to clients with homes in Las Vegas worth $50 million to $100 million who want to put on the market at some point.

Sher said some of the new homes built in the Summit Club in Summerlin, the new uber-luxury resort community, will be $70 million, $80 million, $100 million and $120 million homes, he said.

“It’s super exciting and there’s far more to come,” Sher said. “The sale is a beacon of where luxury is going in the city.”

Martinez said part of that is rising home prices that pushes the envelope of homes that are now valued at more than $1 million. He said he bought his home in Seven Hills in Henderson at the bottom of the real estate market in 2011, paying $390,000. Homes in the neighborhood are selling for $985,000 today, he said.

“Property values have gone up 22 percent or so (in the past year alone) and homes just below $1 million in the $800,000 to $900,000 range are luxury million-dollar property,” Martinez said.

He said the luxury market strength should continue. People who have money aren’t going to deprive themselves of what they want and are able to buy.

Brokerage transaction

In its acquisition, HomeServices of America also obtained Stark’s franchises across three states. That also includes its title and escrow companies of Legendary Title (Arizona), Legendary Escrow (California) and Equity Title (Nevada). Financial terms of the transaction were not disclosed.

Headquartered in Henderson, it serves the tri-state area with nearly 3,000 sales associates in 32 offices in communities throughout Phoenix, Los Angeles and Las Vegas. The company became part of the Berkshire Hathaway HomeServices network in 2014.

HomeServices has nearly 46,250 real estate professionals operating in more than 900 offices across 32 states.

Stark, together with president and chief operating officer Gordon Miles, will continue to lead Berkshire Hathaway HomeServices Arizona, California and Nevada Properties’ strategic planning and growth initiatives as well as manage the company’s day-to-day operations.

The Las Vegas office is the valley’s leader in sales volume revenue with the transactions it handles.

Stark said Berkshire bought the Prudential real estate network in 2013 and transitioned those brokerages to Berkshire Hathaway HomeServices, including Stark’s Prudential American Group that had been part of Prudential until 2014. His franchise has been ranked No. 3 nationally in the entire Berkshire network for gross commissions closed, and that made it an attractive takeover, Stark said. He’s the No. 1 ranked franchise since the top two are owned by Berkshire Hathaway, he said.

In 2020, Stark said his franchise did $7.1 billion in sales in 2020 and grew it by $1.57 billion during the pandemic last year without any acquisitions.

“(To) the world, agents, staff and managers, it’s invisible,” Stark said. “It’s virtually no change. Some of the stronger changes is they have a stronger health insurance policy than we had on our own. Their 401k is better than ours.”

Stark said he will no longer have to deal with banking, managing debt, tax returns, managing capital expenditures or worry about raising capital.

“It opens us up to do so much more to spend more time with sales executives and leadership team,” Stark said.

Stark said he’s gone through good times and difficult times in the industry with the run up of the market in the 2000s. His company filed for bankruptcy reorganization during the market downturn in 2007 before emerging from it after six months in 2008.

By being taken over by Berkshire Hathway, the operation is well-positioned to deal with both aspects of the marketplace, Stark said.

“I want to be in the camp where this is an opportunity and not a chokehold,” Stark said. “The first time I went through it, it was a chokehold for me. We had a lot of support and got through it, however I am one guy. I don’t care how much you try and save but when things adjust, it can be tough. In this scenario, we are unstoppable. Berkshire Hathaway is one of the largest companies on the planet. I’ll be able to be in the opportunity court and (manage) how we are going to take advantage of this (next) downturn and grow through it.”

Stark has about 150 employees and more than 3,000 agents in more than 30 offices in four markets in three states. In California, they have the Palm Springs area and Orange County. The Arizona office is in Phoenix. In Las Vegas, Stark has more than 1,200 agents in Nevada.

“We’re killing it in 2021,” Stark said. “We are so far ahead for all our companies and Nevada is way up. The biggest thing I watch (to have an impact) is interest rates and the economy.”