MGM 3rd Quarter 2010

The third quarter of 2010 has officially ended and it’s time to take stock of recent developments at the MGM Signature Hotel/Condo project. I have been following this particular property for over two years and have published a quarterly update throughout that time. This quarter is particularly noteworthy as it has brought the opportunity for fractional ownership in the MGM Signature towers for the first time in the history of the development. (More on that later in this article.)

Beginning with the sales data: In my second quarter, 2010 MGM update, published on my blog August 17th, 2010, I stated, “I am ready to go on record at this point and say that we have seen the bottom of this market as far as pricing on MGM Signature units is concerned...demand has accelerated so steadily for these units that I believe demand is now outpacing supply.” This prediction has certainly come true. In the third quarter, we watched sales of one bedroom units increase slightly from 24 units in the second quarter to 26 units in the third quarter...but the significant change came in the average price per unit sold. In the second quarter of 2010, the average one bedroom unit at the MGM Signature sold for $218,000. During the third quarter, this price went up substantially to $227,000. Another telling statistic is the decline in the number of one bedroom units selling under $200,000 (6 units in the third quarter, down from 9 in the second.) As this article goes to press, there are no listings for one bedrooms under $200,000.

Although the average price for a studio unit in the third quarter remained steady at $155,000, we saw yet another sharp increase in sales volume. 53 studio units (sometimes referred to as junior suites) closed in the third quarter, up from 41 units in the second quarter, which was already up substantially from 36 units in the first quarter of 2010.

There are currently zero bank-owned REO units of either type available for sale at the Signature towers. There are 5 short sales available for one bedrooms and 24 short sale studios listed. The remaining 11 one bedroom and 33 studio listings are regular re-sales.

As I stated at the end of the second quarter, demand is now exceeding supply at the MGM Signature. If you are at all interested in investing in this property, now is a great time to do it. I track all four possible methods of acquiring a unit (short sales, REOs, re-sale, and units purchased directly from the trustees’ sale) in order to get my investors the best possible entry price into the property. As a result, I currently have the lowest priced strip-side studio unit available in the entire property. It is priced at $144,000. (Contact me if you are interested.)

Another option we have just put in place is for those of my clients who have expressed an interest in owning a portion of an MGM unit that they can use for vacations, etc. We have just put together a fractional ownership plan that works perfectly for those who want to invest a lot less money and still control a four week block of time at the MGM Signature. We are currently offering fractional options on two different units. The fractional shares sell for $14,995 and include all maintenance fees and HOA dues for the first year. Each share is entitled to four, separate, full weeks of use of a strip-side unit with balcony. Investors who do not wish to use the unit for the entire share can place the unit in the rental pool and earn revenues on the room for any un-used nights.

If you are interested in purchasing a unit, or a fractional share of a unit, at the MGM Signature Hotel/Condo, please contact me for more details. I have specialized in this property for years and would love to help you acquire a piece of the Strip.

Glenn Plantone
(702) 769-9872
gsplantone@gmail.com