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Saturday, March 28, 2009 | 2 a.m.
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- Las Vegas Sands lays off 283 workers (3-17-2009)
- Letter sent to MGM Mirage employees from CEO James Murren (3-27-2009)
- MGM MIrage payment keeps CityCenter on track (3-26-2009)
- Harrah's extends debt-exchange offer, deadline (3-26-2009)
- MGM lending pitch from Ensign, Reid so far on ethical up-and-up (3-25-2009)
- CityCenter partner might want more say (3-25-2009)
- Tropicana creditors want Vegas property split from company (3-24-2009)
- Lawsuit clouds future of CityCenter; MGM responds (3-23-2009)
- Herbst Gaming files for bankruptcy protection (3-22-2009)
Beyond the Sun
If CityCenter gets mothballed, is that good or bad for the other properties on the Strip?
The answer to the question depends largely on the state of the overall economy.
Think of profit on the Strip as a pie.
When the economy is soaring and tourism seems to be an ever-growing industry, the pie is large with plenty to go around. Casinos operate at near capacity, room rates rise, and everyone gets a big slice.
In fact, each Strip casino contributes to the others’ share. A casino that lures visitors helps the others, as people are apt to gamble, drink and party at more than just the hotel where they are staying.
In these conditions, other casinos are likely to think a new gleaming property is a positive, because it is thought to attract even more people to the city.
“Historically one reason we’ve been so successful is we’ve continually reinvented ourself,” said Vince Alberta, spokesman for the Las Vegas tourism bureau. When a new property opens “people immediately want to come see it.”
Pre-recession, that’s basically been the scenario — with few exceptions — since the 1989 opening of the Mirage kick-started a wave of Strip development.
But in the recession, the equation has changed. Supply is outpacing demand. CityCenter would saturate the market with rooms, siphoning business from other casinos.
Analysts say other casinos would likely be relieved in the short term if CityCenter didn’t open or was delayed.
Some analysts said CityCenter shuttering would better for the existing MGM Mirage properties as well. Any business CityCenter draws in today’s economy would likely hurt MGM Mirage’s higher-end properties. Even the most luxurious resorts in Las Vegas, including Wynn Las Vegas and MGM Mirage’s Bellagio, are running big discounts to lure customers.
Still, troubles at CityCenter don’t bode well for the long-term view of Las Vegas’ prosperity.
As one former casino executive said, it’s one less thing for the city to crow about.
The Strip loses the increased advertising and marketing CityCenter would do to attract people to Las Vegas.
Though CityCenter won’t yield the kind of boost Las Vegas had grown accustomed to before the recession, it’s still expected to attract customers because it is unique, iconic and will generate global publicity, said Jacob Oberman, a gaming analyst with C.B. Richard Ellis.
Though the latest resorts have expertly catered to highrollers and expense-account-wielding conventiongoers, CityCenter has the potential to attract masses of gawking tourists, Oberman said.
Sun reporter Liz Benston contributed to this story.
When bankers and builders went faster and faster building bigger and better like it could never end, they are chastised and ridiculed. They are pulled in front of Congress and held up as thieves and immoral.
When Las Vegas corporation put their head in the sand and pretended life could never slow down they built newer and bigger every year. The MGM city complex is building more space and venues than have ever been done befroe with it's eggs all in one basket.
What do they get from Congress? harry Reid trying to arrange a loan from banks he is now contolling through the government take over and held up as a necessity for Nevada's economic survival. I know we need the jobs, it's the hypocracy that offends me so much.