Integral to understanding where the local CRE market is heading is understanding what brought it to its current lowly condition. This isn't too tricky really - the obvious answer is the bursting of the housing bubble. Housing went away, took 70,000 + construction jobs with it, and here we sit.
Does that mean the current residential construction is what's holding us back? Well, probably. Gaming has shown some signs of recovery over the past year and half, including expanded employment, but gaming does not appear to be acting as the catalyst for full-scale recovery.
Construction alone, though, is not what Southern Nevada needs. Home sales, like every other "retail" sector have to follow demand, and Southern Nevada currently has enough supply to meet that demand (though this may not be the case in another year or two). What was driving the Southern Nevada economy before the crash is what we are really lacking after the crash ... Population Growth!
You can see from the above table that Nevada's population (most of which is in Clark County) grew steadily since the 1970s - and probably before the 1970s. But around 2009, the unthinkable happens - the population actually drops. Probably not for the first time ever, but for the first time in almost 40 years, Southern Nevada ceases having a steady stream of new residents (net) to buy new homes or rent apartments and go to the stores to buy all the things involved in setting up house, not to mention eating out, shopping for clothes, etc.
Steady population gains, as much as, or quite possibly, more so than gaming, was the engine driving the economy in these parts. Naturally, gaming played its part in providing a source of employment for new-comers, and in-migration itself created the inducement of employment for more folks to put down roots (often very temporary roots) in Las Vegas - though this, of course, proved a double-edged sword.
Where does that leave Southern Nevada now?
As of 2011, the population has leveled, but is still not rising. That's bad news. Possible good news, though, is that in-migration, at least in terms of out-of-state driver's licenses being turned in at the DMV, is showing some signs of recovery from the lows hit in early 2010.
Much of this migration is probably in the form of retirees, since the job market here is still pretty weak (though the Valley is probably suffering from a lack of suitable applicants for many of the available jobs, so some of our new citizens may well have come here to take skilled or professional jobs). Retirees are a welcome sight in Southern Nevada, as they were a key component to growth in the good old days, and will likely be a key component of growth again. Retirees come with their own built-in income, and that income stimulates job growth, especially in the retail and health sectors. Along with the renewed gains in gaming (slow going, though, and remember to watch gaming revenue and taxable sales more than visitor volume), the renewal of migration to Southern Nevada may prove to be what the region needs to begin a serious recovery, especially in terms of commercial real estate.