The LVRJ is reporting that the Las Vegas Sands Corporation, parent company of the Venetian, Palazzo and the Sands Expo and Convention Center is “in jeopardy of missing certain financial covenant requirements and needs to raise more capital.” This could result in the company defaulting on some of its loans and possibly being forced into bankruptcy.
The company’s stock price has dropped more than 90% this year and Sheldon Adelson, the Chairman and Chief Executive Officer has lost over $16.6 billion of his net worth. Ouch!
One of my neighbors works as a dealer at the Venetian and he confirms that things are really slow in the casino and that many of his co-workers are fearful of layoffs.
Gaming stocks have lost more than $50B in value since last summer. Experts blame the current downturn on everything from rising fuel costs to the new casino projects in Macau not living up to lofty expectations. The Las Vegas Sun interviews three fund managers who invest in the gaming industry to get their perspective.
It pays to be a casino pit boss. “Gaming Manager” is mentioned in this article about jobs paying six-figure salaries.
If Chris Binkley’s book is about the old guard and how they shaped Las Vegas, this article from the NY Times is about how a new generation of moguls is building out their vision of Las Vegas.
MGM’s CityCenter project was discussed on NPR’s All Things Considered today. It was amazing to hear that half of the $8B budget is already paid for through residence pre-sales and foreign investments.
Here’s a photo I snapped of Steve Wynn’s latest project Encore. That’s right, it’s another hotel right next to the Wynn and it’s reportedly costing over $2B. You can’t really tell from the photo but Encore is arched the other way (convex vs. Wynn’s concave shape).
According to MarketWatch, a group of investors has plans to re-develop the historical Moullin Rouge. There will be a new hotel, convention space and casino built on a budget of almost $1 billion. The site is located on the troubled west side of town so this project could help revitalize the area.
The Moulin Rouge Hotel has an important place in Las Vegas history:
“The Moulin Rouge opened on May 24, 1955, built at a cost of $3.5 million. It was the first integrated hotel casino in Las Vegas, perhaps in the nation. Until that time almost all of the casinos on The Strip were totally segregated—off limits to blacks unless they were the entertainment or labor force.” — Wikipedia
300,000 football fans are expected to watch Super Bowl XLII in Las Vegas this year. I honestly don’t see the draw: sure it’s fun to watch the game with a couple hundred rabid fans but all the sports books are crazy crowded and it’s tough to make a bet or find a place to sit.
The casinos are expected to take in a record $100M in wagers this year. Sounds like a lot until you consider that many estimate total Super Bowl gambling will top $10B (most of it illegal and unregulated like office pools). On top of that, with the Giants winning outright (the spread was Pats -12) it looks like the sports books had a tough weekend.
But don’t feel too sorry for them. The brilliant Vegas business model comes through again: tonight I saw hordes of jersey-clad Giants fans giving back their Super Bowl winnings and more at the card tables. Viva Las Vegas!
This article from USA Today offers a good summary of the various construction projects underway on Las Vegas Boulevard. 2008 kicks off three years of new casino/residential/mixed-use debuts:
- The Palazzo celebrates its official grand opening this weekend and the combined Palazzo/Venetian duo should be almost as lucrative as ticket sales from the Miley Cyrus/Hanna Montana concert.
- The Maloof Brothers are adding Palms Place to their resort in February.
- The Donald opens the first of two Trump International Hotel & Towers this spring.
- You cannot miss MGM’s ginormous construction mess between Monte Carlo and Bellagio, CityCenter. It is being called the largest privately financed construction project in history.
- Steve Wynn is spending over $2B on his Encore to the very successful Wynn property.
- Fountainebleau Resorts will introduce a chic hotel and casino with “crisp aesthetics” in 2009. They own the popular resort with the same name in Miami.
- Boyd Gaming is betting big on hard-10. 2010 is when we’ll see Echelon, a sprawling resort including five separate hotels introduced on the old Stardust site.
