Hotel prices in Miami Beach are often as much as twice as high as similar properties in Las Vegas, according to an analysis by Strategic Advisory Group. The study was done on behalf of the city of Miami Beach. It comes in light of a recent vote against a potential casino resort in the city, and amid growing concerns over the impact of the addition of thousands of potential hotel rooms in downtown Miami. “If you put 5,000 hotel rooms in downtown they will suck out everything surrounding them,” said Stuart Blumberg, the former head of the Greater Miami and the Beaches Hotel Association. “It will take 19 years for the current hotels to break even. They’re going to destroy the market inventory.” [Miami Herald] [more]

From The Real Deal’s December magazine: Las Vegas houses emptied by foreclosure are being turned into marijuana “grow houses,” the New York Daily News reported, as drug dealers take advantage of affordable real estate for rent. Last year, authorities dismantled 153 indoor grow sites in Nevada and seized more than 13,000 plants, compared with 18 sites and 1,000 plants in 2005, the U.S. Drug Enforcement Administration said. “You can’t have crime without opportunity,” University of Nevada criminologist William Sousa told the Daily News. “All those empty homes present an opportunity for criminal activity.” Growers can cultivate over 200 marijuana plants worth $3,000 each in a large home, the News said. Hydroponic marijuana grown indoors can sell for over four times what Mexican marijuana nets. “With this market, it’s almost a free-for-all right now,” Las Vegas police Lt. Laz Chavez told the Las Vegas Review Journal earlier this year. “These guys aren’t the fun-loving hippies with a small garden in the backyard. These are dangerous criminal groups doing this.” [more]

The casino proposed by Malaysian firm Genting for downtown Miami would contain four times more gambling space than any casino in Las Vegas, according to the developer’s plans. But the city is still divided on the benefits of casino gambling. “When you look at the enormous size and scope of some of these projects, it just doesn’t make sense,” said Phil Goldfarb, the president of the Fontainebleau Miami Beach. [more]

Commercial property buyers who had shifted their focus from prime coastal city properties such as in New York and San Francisco to secondary markets like Las Vegas, Dallas and Minneapolis, may be rethinking their strategies as a result of recent financial market volatility, Bloomberg News reported.

Investors had been showing interest in secondary markets amid growing confidence in the recovery and soaring prices in prime cities, Bloomberg said, with transactions increasing sixfold in Las Vegas in the first half of 2011 from the same period in 2010, by about 253 percent in Phoenix, 204 percent in Atlanta and 267 percent in Pittsburgh, according to data from Real Capital Analytics.

Concern, however, that the U.S. property market may only experience sluggish growth in the next few years could stymie this trend before it takes off, sources said. [more]

The booths at RECon, the world’s largest retail real estate trade show taking place in Las Vegas this week, tell a story on their own of the industry through their size, location and pull on attendees. The booths of brokerage firms like CB Richard Ellis and Newmark Knight Frank were more densely packed than their competitor Jones Lang LaSalle today, but also smaller. JLL took a much larger corner space, and its display included a waterfall spelling its name in cascading letters on the outside wall.

RECon, the annual trade show put on by the International Council of Shopping Centers, is considered by most brokers to be the most important show of the year. It started yesterday and runs to Wednesday, and draws approximately 30,000 attendees to the more than 1,000 exhibitors spread across three massive halls. [more]

Follow The Real Deal on Twitter to get a real-time look at what’s going on at the world’s larges retail convention, International Council of Shopping Centers, known as RECon. Look at tweets with the hashtags #ICSC and #RECon. Besides this event, The Real Deal tweets all sorts of fun stuff from industry parties to real estate gossip to goings-on at The Real Deal. We can be found at http://twitter.com/trdmiami. And fun party pics, factoids and articles are posted on our Facebook fan page: facebook.com/therealdealmagazine. TRD

The fallout from the failed Fontainebleau Las Vegas casino project continues to plague developer Jeffrey Soffer, who has been hit with a $168 million lawsuit from Lehman Brothers. The fallen investment bank wants Soffer to cover the loan he personally guaranteed for
the ambitious expansion of the Fontainebleau franchise to the Sunset
Strip. This sets the stage for a major legal clash between Soffer and
creditors of his casino project, which was sold to Carl Icahn last
month for a paltry $150 million. The project had previously been valued at $2 billion.
That’s not the end of Soffer’s troubles: the Miami Beach Fontainebleau
resort faces more than $60 million in claims by contractors who worked
on its $500 million renovation, as well as a $660 million overdue
construction loan from Bank of America. [Miami Herald]

Thousands of South Floridians are among the nation’s foreclosure victims who’ve learned the hard way that troubles spawned by that procedure don’t end when they lose their home. John King, a Coral Gables resident who defaulted on his mortgage and was foreclosed upon, found out last month that a Miami-Dade County court gave debt collectors permission to seek an additional $44,000 stemming from the litigation. Lenders, reeling from the collapse of boom real estate markets like South Florida, Las Vegas and California, are now pursuing their right to seek the unpaid mortgage balances of homeowners who have defaulted. Ben Hillard, a former investment banker who now is a real estate and corporate attorney at Hillard & Rogers in Largo, said banks are now able to pursue what are called deficiency judgments with greater frequency as they adjust to the realities of a market cratering. [Business Week]

Carl Icahn and the Fontainebleau Las Vegas

Investor Carl Icahn doubled a rival offer and put up a $155 million minimum bid for developer Jeffrey Soffer‘s unfinished Fontainebleau Las Vegas casino hotel. Penn National Gaming, a Pennsylvania casino operator, last week offered a $105 million opening or stalking horse bid for the Fontainebleau. Penn initially tried to beat Icahn’s offers during a hearing Monday but stopped at $145 million. Miami bankruptcy Judge A. Jay Cristol approved the broad outlines of the Icahn plan, which Fontainebleau lawyers endorsed, clearing the way for a Jan. 21 auction. [Miami Herald]

The troubled Las Vegas outpost of Miami Beach’s landmark Fontainebleau hotel may be headed to Chapter 7 bankruptcy. Creditors say developer Jeffrey Soffer can’t get out from under the $3 billion project’s battered finances and want him out. The Miami Beach hotel isn’t involved in the project, but the Las Vegas hotel is the Soffer family’s largest endeavor. It’s about $1.5 billion short of completion and has been in bankruptcy court for the past four months.