Lake Las Vegas residents keep confidence despite bankruptcy

Mike Tobey and his South Shore Golf Club cronies have the course pretty much to themselves on a 108-degree weekday. If they're feeling any heat to speed up their play, it's coming from the scorching desert sun.

They're OK with that.

For these guys, playing a round of golf against the mountainous backdrop of Lake Las Vegas -- stopping for bighorn sheep that occasionally wander onto the course -- is the ultimate satisfaction for buying into the 3,600-acre resort community east of Henderson.

They're acutely aware of the myriad problems dogging the upscale neighborhood that gained fame as the residence of singer Céline Dion.

Lake Las Vegas has been going through bankruptcy reorganization since July 2008 after Santa Barbara, Calif.-based developer Transcontinental Corp. defaulted on a $540 million loan with Credit Suisse. The resort lost $11.5 million in May and has lost $60.7 million overall since filing for bankruptcy.

The Falls and Reflection Bay golf courses are closed. Carmel Land & Cattle Co., which holds a $28 million note on Reflection Bay, plans to foreclose on the property. It's uncertain whether the course would be reopened or sold for future development.

Owners of the Ritz-Carlton, one of two premier hotels at Lake Las Vegas, filed for Chapter 11 bankruptcy. And like other places that got caught in the housing bubble, Lake Las Vegas has been plagued by foreclosures and falling property values.

None of that has scared off Bob Taylor. He looked all over California and Arizona when he retired from the motion picture industry in 1997 before settling into Lake Las Vegas. He even looked at the master-planned Summerlin community in Las Vegas.

"There's nothing wrong with Summerlin, but there's something about this area with the lake and the mountains and it's quiet. We just loved it out here," Taylor said. "I knew there'd always be something to do here. We can go to shows and I wanted to take up golf again."

Tobey, a retired billboard advertising executive, was living in Sun City Summerlin when he bought a custom lot at South Shore for $280,000 so he could join the golf club. His wife, Judy, decided she wanted to move there, so they sold the lot and bought a modest home at Belle Vivente.

He takes offense at stories in the media that portray Lake Las Vegas as something of a ghost town. A recent picture of MonteLago Village, the $500 million mixed-use retail and residential district developed by Intrawest Corp., shows a lone person strolling past shops.

The recent Fourth of July extravaganza at Lake Las Vegas attracted thousands of spectators with jazz, barbecues and fireworks, a scenario in stark contrast to the photo.

"You should see the village on a Saturday or Sunday night," Tobey said. "They've got a Mexican restaurant with entertainment, a French restaurant. They're trying like hell. It'll come back. The South Shore is vibrant."

New-home construction is down to maybe a dozen sites at South Shore, but that's typical of any luxury neighborhood in Las Vegas. Castle Development has let the dust control permit expire for a 0.3-acre custom residence, but construction is under way on the Williams-Kirby residence by Wright Custom Home.

Although foreclosures are up, they're mostly condo-hotel units and production homes purchased by speculators, said Carol Russell, Realtor for Prudential Americana and waterfront lot owner at Lake Las Vegas. Only two of 37 custom homes listed for sale in South Shore are foreclosures, she said.

"South Shore was very well established," Russell said. "It's people who bought in that three- to four-year period of new development. They had adjustable-rate mortgages and no money down. Those are the people in trouble. They bought at the height of the market when there were multiple bids on expensive properties."

She hears horror stories about the condo-hotels. They were purchased at high prices and they're difficult to resell because lenders won't finance them, Russell said. More than half of Lake Las Vegas condo-hotel listings are bank-owned or short sales.

People who paid $360,000 for cramped condo-hotel units at Viera and Luna di Lusso at Lake Las Vegas were obviously speculators and they got burned, Tobey said. One repossession is listed for $91,900.

"What happened here is that there was speculator after speculator on the other side (of the lake) and they're the ones that got caught," he said. "Too bad for them, but that is what speculation is all about."

He said a private group is trying to buy South Shore Golf Club, and he hopes new owners of the two public courses open them again and price them right.

Loews Resort at Lake Las Vegas, originally built as the Hyatt Regency, still offers fine dining and MonteLago Village has a number of nice restaurants, Tobey said. The South Shore Yacht and Beach Club is opening a new dining facility.

Development will continue at Lake Las Vegas, but probably at a slower pace than the last several years, said Bob Otto, a South Shore resident since 1999.

"I think quality communities will come back once the economy recovers," he said. "Just the overall look of the community is appealing."

Russell said Lake Las Vegas is "alive and well" with 127 homes sold in the past 12 months.

"I dare say that is more than any other community in the Las Vegas area," she said.

Not all home prices have been reduced, Russell noted. The least-expensive home on the South Shore is listed for $795,900, an increase of $100,000 from its previous price. On the high end, a home listed at $7.9 million was previously priced at $7 million.

Twenty-three listings for single-family homes on the North Shore and West Shore range from $205,000 to a $1 million home previously priced at $1.25 million.

Contact reporter Hubble Smith at hsmith@reviewjournal.com or 702-383-0491.