A look at the "per acre" construction costs of two Las Vegas Strip developments, MGM MIRAGE CityCenter and the Cosmopolitan Resort Casino.

In March 2008, the Wall Street Journal reported that Deutsche Bank had filed foreclosure on developer Bruce Eichner's Cosmopolitan Resort. The Wall Street Journal also reported that Related Cos. had partnered with Starwood Hotels & Resorts Worldwide's W Hotel group to bid on the prime-location Las Vegas Strip property. You can read our blog entitled Cosmopolitan about to become The W?!

To date, when it comes to density, the Cosmopolitan Resort is the most "New York" of high-rise projects to ever hit the Las Vegas Strip. Just how dense is this piece of real estate?

When compared to MGM MIRAGE CityCenter, the most expensive Strip project to date, the Cosmo's "per acre" construction costs speak volumes.

• CityCenter sits on approx. 76 acres and has an estimated cost of approx. $8.4 billion.
  
• CityCenter development costs come out to about 110 million an acre to develop.
  
• The Cosmopolitan Resort sits on approx 8.5 acres and has an estimated cost of approx. $3.9 billion.
  
• Cosmopolitan Resort development costs come out to about $460 million an acre.

MGM MIRAGE CityCenter seen to left of the Cosmopolitan Resort (far right).

The Costs of Cosmo

To put things into perspective, the Cosmopolitan Resort Casino is now almost half as expensive as MGM MIRAGE CityCenter. Think about that, one project with only two towers, costing almost half of what the most expensive private-funded project in U.S. History costs.

CityCenter will feature six high-rise towers, five of which will be home to luxury condominiums (The Harmon Hotel, Spa & Residences, Veer Towers, Vdara Condo Hotel, and the Residences at Mandarin Oriental). The Cosmopolitan Resort is comprised of just two towers, the main resort and the Cosmo Beach Club Tower.

The Cosmopolitan Resort Casino and Cosmo Beach Club Tower seen here just right of The Harmon Hotel, Spa & Residences.

Digging, Parking, and Water

Digging down in Las Vegas is not only time consuming, but also very costly. So why did developer Bruce Eichner and Perini have to build 110-foot deep slurry walls? To support the 85-foot-deep underground parking structure.

Not only that, a first of its kind in Las Vegas water pump was installed underneath the project due to a high water table that runs just 16 feet beneath the Las Vegas Strip. While most casinos build their parking structures above ground, the Cosmo needed to do it below ground due to the tight land constraint.

Yes, the Nevada desert has aquifers and they have been a big problem for Las Vegas development in the past. Not only did the big dig seem to take forever, it was very expensive.

The Cosmo has an $8 billion neighbor in CityCenter. The Crystals, The Harmon, and Cosmo Beach Club Tower seen below.

The Cosmo Beach Club Tower is finally taller than the Jockey Club.

FOUR TIMES THE COST TO DEVELOP PER ACRE

The Cosmopolitan Resort Casino is so dense and had so much underground work to do, its cost PER ACRE to develop is approx. FOUR TIMES greater than the cost "per acre" to develop CityCenter.

The construction costs and density of the Cosmopolitan Resort clearly show the value of this property's location and the value of the condotel units inside of it. If W gets it, it could be considered one of the biggest scores in recent Strip memory.

Surrounded by the Bellagio fountains and billions worth of construction and future amenities, some say Cosmo's location is the very best in Vegas.

We believe in you Cosmo. We can't wait to celebrate your grand opening!

Are you looking to make an investment into a vacation property or primary residence in Las Vegas, Nevada?

Aaron Auxier has earned the nickname "Hollywood's Connection to Vegas" for his Los Angeles entertainment background and Las Vegas connections. He is responsible for selling some of the most glamorous penthouse and luxury high-rise condominium properties in the history of Las Vegas.

Aaron Auxier, REALTOR®, ABR can be reached at 702-205-1818.

Luxury Realty Group is recognized by the press as a leading brokerage on the Strip. They can be seen on networks and in publications such as CNBC, Forbes Magazine, Details, Wall Street Journal, The Review Journal, Los Angeles Times and USA Today.

Copyright © 2008 Aaron Auxier. All Rights Reserved.

Disclaimer: All information in this blog is subject to change without notice. Subject matter is not guaranteed and is often considered time-sensitive.