Clients and projects he has consulted on have included Summerlin, Project CityCenter, the Boulder Dam bypass, Interstate 215 and the widening of Interstate 15, Aliante, Apex and the M Resort. Restrepo has also become widely quoted in local and national media because of his expertise and research into the valley's growth.

Restrepo is a board member of the National Association of Industrial and Office Properties, an associate member of the Society of Industrial and Office Realtors and the Urban Land Institute, chairman of the Advisory Committee to the UNLV Department of Economics and former chairman of the Governor's Task Force for Long-Term Financial Analysis and Planning.

Restrepo sat down with In Business Las Vegas to discuss the state of the Las Vegas commercial and residential real estate market, emerging trends and challenges on the horizon.

Question: How are land prices affecting the valley's growth?

Answer: It's slowing it a bit, moderating the growth a bit because it's having an effect on real estate prices. It's having an effect on the price of homes, the price of commercial real estate. It's causing developers, both from a residential and commercial standpoint to revaluate what kind of project they want to build and is making them go back to the drawing boards to assess financial feasibility. So consequently those rising land prices have had an impact on us. The impact is known now, so the market is adjusting to it. The bigger unknown is construction costs and that's what's really causing some concern in the development community. The more unpredictable impact on real estate prices is the cost of construction, labor and materials -- more than the land.

You've done some research recently on affordable, attainable housing. How does the valley stand in providing that workforce housing to its population?

We're doing ok, it's getting worse though. We have some challenges ahead of us. To date, there's been some indication of some storm clouds ahead. We will know more as the next couple years unfold. The reputation of Las Vegas of being an affordable housing market is slipping away. You have to look at a variety of statistics that tell you that, such as the ratio of house price to income. Median household incomes have been relatively flat for the last 10 years, but we've seen house prices go up dramatically. What that has done is changed the ratio of house prices to household income. In 1995 for a new home the ratio was about 4.2, it's now 6.7 at the end of 2005. So from 1995 to 2005 it grew quite dramatically, in terms of the loss of affordability. What's helped mitigate that loss of affordability to a certain extent has been historically low interest rates. That's changing, interest rates are going up and we'll see what that does to affordability.

So is the problem with affordability its effect on people who are moving into Las Vegas or on people who already live here?

A little bit of both. Obviously the ones that are moving here to buy a house, many of them cannot afford to buy a house. Those that were in early and bought their house, they are OK. They may not be able to upgrade to a bigger and better house, but at least they own a house. For those who have lived here for awhile that are thinking about buying and have been renters, it is affecting them. So the impacts are greatest on the new people moving in and the ones that have been renting who want to buy a home.

When you tell people that it's the people that are moving in that are affected the most, many folks say 'Well, one third are from California so it's not a big deal.'

So that means two thirds aren't. And we have to assume those one third from California all owned a home in California and came here with cash, and we don't know that.

How will it impact Las Vegas if people can't buy a home when they move here?

What it will do is slow population growth down, which is not necessarily a bad thing, per se. But the bigger impact, it will slow economic diversification and growth. We'll be perceived as a more expensive housing market than some of the cities we compete with. It's not enough to say to say that we're cheaper house-price wise, compared to cities in California, we'll always be less expensive than California. The bigger issue is how competitive are we on pricing when it comes to cities like Phoenix and Albuquerque and Salt Lake and Denver. Those cities all attract businesses out of California.

An economist at a recent Las Vegas multi-housing seminar said that rent growth of 6.5 percent per year cannot be sustained because the population can't afford it. On the flip side, developers said rent growth is necessary if apartments are to be built in Las Vegas. Can we continue to raise rents?

It's a little bit of both, I hate to give that economist type of answer, but it is. There are limits on how far you can raise the rents above what the renter is willing to pay. At some point if the monthly rental is getting so high, they have to do something, move out of town or get roommates. There are some limits on how high you can go on the rent, but there are some requirements the developers have to make, to make the projects financially feasible, and that's driven largely by rents against the cost of land and the cost of construction. We've had relatively flat rents for a long time. Are rents rising higher than housing prices? If the rents are still relatively cheap then people stay as renters longer. We have to figure out how to get more density per acre, to get as much revenue as the developer needs, but maybe lower it per unit basis on the rental side.

You've talked about a shadow market in the past, could you explain what that is?

The shadow market we estimate is around 170,000 units. That's comprised of individually owned single-family homes, town homes, and condos. Not all of them are up for rent, but they all are considered by the Clark County Assessors office as commercial properties because they're paying that 8 percent tax, which indicates that they are potential rentals. So that means that there are about 170,000 units that could provide rental housing. Now that doesn't mean it's affordable, but it's out there and it can help relieve some of the pressure on rents in the apartment complexes. Often times the individual owners of rental properties are a little bit more flexible in what they want to charge for rent.

There has been a lot of talk about satellite communities; do you think these communities will grow in importance and who will live in these communities?

It's going to take a while for this community to adequately address the affordable housing, or attainable housing crisis that's looming. There's going to be a relief valve in the short term and it's the emergence of the bedroom communities in places like Coyote Springs, Pahrump, White Hills area, Mesquite even some people have mentioned Sandy Valley. These more rural communities will be one of the tools to provide housing for our workforce population. That's the good news. The bad news is it will lengthen commutes. Those driving will have to consider the relative savings they are getting on their home and the relative increase in their costs because of gas prices.

Many developers and brokers are concerned about the tight industrial market and its potential implications on the valley. Is it a true concern?

It's a real concern. There have been instances in the last two or three years when businesses have wanted to move to Las Vegas, industrial using types of employers, and have not been able to find adequate space here because our vacancy rate is so low. So the next question is can you build me something? And then there is a bit of sticker shock when they see the land prices and the construction costs. So what have they done? They've either decided not to expand and wait and see what happens, or they continue their expansion plans, but expand somewhere else, to Salt Lake, Albuquerque or Phoenix and we end up losing those jobs. There is some movement by the development community and some of the political jurisdictions to, through the BLM (Bureau of Land Management) land process, earmark some of the land that is going to be auctioned for commercial development, so we try to maintain a reasonable job housing balance, which is about 1.5 jobs per dwelling unit.

Do you see the condominium high-rise market changing? Some high-rise developers are talking about entering the second or even third wave of development.

I think we are going to a period of a more realistic view of our high-rise condo market here. We've had a period of irrational exuberance on the high-rise condo market, where we thought the demand would be a lot higher than it has ultimately proven to be, combined with the land prices that we've seen and the construction costs. Over the next five years, we'll probably see 25 percent of the 60,000 (proposed) units actually built. So we'll see about 15,000 (residential) high-rise units built over the next five years.

As far as condominium projects that are now starting to be marketed, have they missed the boat, should they have started earlier?

Most of the projects have been along the Strip corridor, they're essentially projects that serve second homebuyers, investors and speculators. That's why 80 percent of the time these units are dark. A question I always ask when someone comes to me asking for a feasibility study: Have you ever built one of these before and if not are you joining forces with somebody who has? Do you have your contractor lined up, do you have your construction financing moving forward or in place. If those answers are no, they generally fall into the category of the guys with a Web site and a dream, the speculator club. That's what's gone away from here. The high-rise developers are looking at this market a bit more realistically. A lot of the speculative guys that would tie up a site temporarily and then start flipping it and using a Web site and put a trailer on a vacant lot, those guys have pretty much gone away, for the most part.

How do you think the condo-hotel market will affect hotel occupancy rates?

Not much. There's not enough units being produced, we think, that's going to affect the overall occupancy. It's a relatively small percentage; we don't see much of an impact on vacancy or average daily room rates.

Do you see mid-rise growing in popularity throughout the valley?

If we're going to be talking about high density residential product, we think that they are the projects that have the most opportunity for developers and for residents. That's probably the most likely future for our high density product in Las Vegas, these mid-rise projects. You're servicing the local population and can go into neighborhoods and suburban locations.

What about mixed-use projects? Everyone has talked about doing a project mixing residential, office and retail, but so far the only group that's pulled it off is the American Nevada Company with its the District at Green Valley Ranch. (American Nevada is owned by the Greenspun family, owners of In Business Las Vegas.) Is it a viable product model throughout the rest of the valley?

Developers through their marketing arms can call any project a mixed-use project. A mixed-use project does require relatively equal allocations of square feet among the various uses. When you have something like that you can truly call it a mixed-use development, the District is a great example and the District phase two is even a better example, the uses will be a lot more mixed in there. To say you are going to build an office building and put in a 2,000-square-foot convenience store and call it mixed-use is kind of a stretch.

Is it possible to build everything that is on the drawing boards, and does it have a good chance of going forward?

The issue for us right now is the demand for construction labor by the resort industry. That's what's driving the difficulty here in terms of getting nonresort projects built, we have limited labor resources. We're starting to see some leveling off on the commodity side of the equation. Wood is still expensive, as is cement. But that's largely a function of what's happening overseas. But the bigger issue for us is labor. The resort industry does absorb huge amounts of labor. The other area that absorbs huge amounts of labor is public infrastructure construction projects. We're kind of victims of our own success.

How do you see Las Vegas evolving over the next 10 to 20 years?

I think from our driver industry, the resort industry, it will continue to reinvent itself and provide newer and better experiences to customers. From a residential development standpoint, going to see increasing density in the way we live, the units we build. We'll see a change in the residential skyline. Same thing with office development, it will go more vertical and become more dense. I'm not saying we're going to be ringed with office towers but we're going to see more mid rise office development. We'll see a mixing of office and industrial development. With residential, we'll see more retail with residential on top, like we see in the District. Mixed-uses will be the name of the game in the suburbs. Who knows what the next wave of commercial development will be in the resort corridor.