MGM Mirage, which closed one of its two casinos in Jean, and American Nevada Company are partnering to build what has been announced as a master-planned community of single-family homes, condominiums, retail and a locals-style casino on a 166-acre site.

American Nevada is owned by the Greenspun family, which publishes In Business Las Vegas.

"Very candidly, we're struggling with what exactly to do there," MGM Mirage President and Chief Operating Officer Jim Murren said in a recent interview.

"The economics of a lot of the residential development are not there right now," Murren said. "We're fortunate that we're not sitting on inventory like homebuilders are currently. But the pricing umbrella and the cost of construction have created a difficult environment to make residential pencil out right now."

Bruce Deifik, president and chief executive of American Nevada, concurred, adding that much of the problem involves paying for the extension and expansion of water and sewer pipelines, utilities and other infrastructure to Jean.

Deifik explained that there already are some lines in place serving the two hotel-casinos that straddled Interstate 15 about 25 miles south of Las Vegas, but they can't accommodate the volume necessary to support a major residential development.

"As we did our due diligence, we found that it would be very, very expensive to bring those utilities to the site just for developing those 75 acres to 80 acres on the west side of the (Interstate) 15," Deifik said.

"A lot of things make it more difficult than simply — and with all due respect to some of the homebuilders — getting a tract of land and putting up single-family houses," Murren said. "That's not what we're going to do there. That might not even be a good idea, but it certainly is an easy idea relative to what we're thinking about and we still don't have the answer yet."

MGM Mirage announced in February its plans for a joint-venture partnership with American Nevada, which developed Green Valley and built The District adjacent to the Green Valley Ranch casino.

Under MGM Mirage's plan, the company planned to close the 302-room Nevada Landing property on the west side of I-15, but leave its 800-room Gold Strike property on the east side of the highway open.

In April, the Nevada Landing closed as planned and 300 employees were scattered to 10 other MGM Mirage properties in Southern Nevada or encouraged to apply for jobs at three casinos in Primm about 15 miles farther south. At the time, MGM Mirage was just completing a $400 million sale of those three properties to Herbst Gaming. Some Nevada Landing workers moved over to the Gold Strike.

When the announcement was made, the move was viewed as a turning point for MGM Mirage, which had begun increasing its role in the real estate business with a series of joint-venture partnerships with partners interested in nongaming development.

MGM Mirage and American Nevada envisioned it taking more than a year to detail plans for the Jean acreage, but in the initial announcement company officials said they hoped to make affordable housing available to casino workers who had struggled to buy in what had been a robust market.

Since then the local real estate market has taken a more pronounced downward turn, and the economics of the project have changed.

There's hope on the long-term horizon since Jean isn't far from the proposed Ivanpah Valley airport proposed by Clark County as a reliever airport for rapidly growing McCarran International. But Deifik said the partners are reluctant to do too much while the county is in the midst of environmental impact studies on the property surrounding the airport site. Still, there's likely to be increased demand for homes close to the airport.

Clark County would have to approve any residential development since the 166 acres surrounding the two Jean casino sites are zoned to allow 50 residences per acre.

In addition, some critics of the project have emerged. The Progressive Leadership Alliance of Nevada, an environmental group, said a major development at Jean would increase traffic congestion and air pollution because of the long commutes that would result. A spokesman for the organization called the proposal an example of urban sprawl.

Murren explained that the Jean project isn't meant to be exclusively for gaming company workers.

"We're not in the housing business, that's not what we do, and we're certainly not in the subsidized housing business," Murren said. "But it was something that we looked at as being a potential amenity to our employees if we could pull it off."

Deifik said his company is monitoring options to come up with a plan for the Jean site. One consideration is to use property in the area temporarily to park recreational vehicles and buses.