WMC offers to build showrooms for free
By Clint Engel -- Furniture Today, January 14, 2002
LAS VEGAS — Developers of the proposed World Market Center here upped the ante again last week with an offer to build out tenant showrooms for free.
Through the program, which developers say is worth more than $25 million, the WMC will deliver turn-key showrooms, paying for amenities such as lighting, heating and air conditioning, electrical work, sprinkler systems, painted walls between showrooms, floor covering and showroom fronts.
The move is touted as saving tenants tens of thousands to hundreds of thousands of dollars in upfront costs.
"We are thrilled to be in a position to offer this program," said Jack Kashani, co-managing partner in the proposed 7.5 million-square-foot development. "Basically, the tenants don't have to spend money on tenant improvements to have a showroom built to our standards."
The World Market Center will offer the program — for a few weeks — to all signed and prospective tenants of the more than 1.25 million-square-foot, first-phase building, said Shawn Samson, the other co-managing partner.The improvements are valued at more than $20 per square foot. A typical 5,000-square-foot tenant, for example, would get a completed showroom worth more than $100,000 with no upfront investment, Samson said. A 40,000-square-foot tenant would be saving more than $800,000 in estimated improvement costs.
Samson confirmed the offer is designed, in part, to quickly secure those prospects who have yet to sign leases, and noted that help along these lines was a consideration for some who haven't committed.
"Now we have created a scenario where tenants have no upfront investment," he said. "We have removed all and any remaining considerations for those who were trying to join us."
Asked if the program is an attempt to draw in some big-name anchor tenants, Kashani and Samson noted the free improvements are being offered across the board and that the WMC already has a good mix of companies of all sizes and from all segments of the industry.
To date, more than 110 companies have committed to about 700,000 square feet in the first phase, Kashani said. Developers still are not naming tenants and would not say when they expect first-phase leasing to wrap up, although Samson said, "We believe we are very close." He added that prospects who have been told of the build-out offer have all embraced it, without exception.
"This represents a major commitment on our part to our tenant base and reflects our philosophy of accommodating (their needs) at a time when, due to recession and other considerations, most other projects are cutting back on their services," Samson said.
The WMC is able to offer the free build-outs by passing along the benefits of a tax incentives program it secured late last year from the city of Las Vegas, and through construction and design efficiencies it has generated for the massive project, he said.
In November, the developers received approval for tax rebates worth more the $50 million over the next 20 years to offset the project's infrastructure costs. Shortly after, developers closed on the purchase of the first 20 acres for what it now billed as a $1 billion project.
"We have said that this is the best time in the economic cycle to be developing a major project like the World Market Center," Samson said. "We are receiving very competitive bids for construction."
Construction is expected to begin this spring, with the first furniture market in early 2004.
As first reported in eDaily
