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StumbleFontainebleau sitting idle benefits Strip’s economy
The hulking shell of Fontainebleau sits dark on the Strip. Construction was halted on the resort in summer 2009 after lenders pulled $800 million in financing.
Saturday, Feb. 20, 2010 | 2 a.m.
Carl Icahn
Sun Archives
- Carl Icahn gets OK for Fontainebleau at bankruptcy hearing (1-27-2010)
- Carl Icahn to take ownership of Fontainebleau Las Vegas resort (1-19-2010)
- Will a big wager on Fontainebleau pay off? (1-16-2010)
- Deadline for Fontainebleau bids set for Friday (1-11-2010)
- Fontainebleau judge details guidelines for credit bid (12-8-2009)
- Fontainebleau: Half-built bargain bid up by billionaire (12-7-2009)
- Fontainebleau lenders sue construction companies over liens (11-27-2009)
Ever since it became clear a month ago that financier Carl Icahn would be the new owner of the bankrupt Fontainebleau Las Vegas on the Strip, the big question has been: When will it open?
One of the last things Las Vegas needs during this Great Recession is Fontainebleau’s 3,812 hotel rooms. With tourism and consumer spending still in the tank, Las Vegas is struggling to absorb the hotel rooms that have been added in past year, a 6 percent increase. Strip hotels have had to lower their rates to try to maintain occupancy levels.
Icahn has kept silent about his plans for Fontainebleau, but a key gaming analyst predicts it won’t open until 2015 at the earliest.
The analyst, Bill Lerner, is considered one of the gurus of gambling, a swami of the Strip, so his take on Fontainebleau has some in the industry breathing a little easier.
Lerner, who was with Deutsche Bank until co-founding Las Vegas-based Union Gaming Group last year, figures Icahn will just wait for better market conditions.
“I really think it’s a five-year mothball,” Lerner says. “When it comes to market, who knows what the ultimate cost to fit it out will be? There are going to be remediation issues that need to be addressed earlier. They’ll lock the building down, get security and insure the thing. But I think it’s a smart idea to mothball it.”
It’s hard to estimate how much the shutdown, remediation and completion of the 68-floor project would cost, but he says it could be “$1.5 billion in today’s dollars to bid out the interior and finish the exterior.”
In any case, Lerner is skeptical Las Vegas will ever again enjoy an average occupancy rate in excess of 90 percent and average room rates of $132 a night.
One contributor to that is likely to be the Cosmopolitan, adjacent to CityCenter.
The 3,000-room Cosmopolitan was foreclosed on by Deutsche Bank, Lerner’s former employer, and he expects the property to open in the fourth quarter.
“It’s unfortunate that we’re going to have some incremental supply,” Lerner says. “As far as the market goes, we just don’t need more supply. Deutsche’s not concerned about what its supply will do to the rest of the market. It’s about recovering capital invested in the project, getting to a recovery and then selling it.”
The future of another stalled Strip project, Boyd Gaming’s Echelon, is even more complicated.
Construction on the 87-acre multiuse development on the site of the former Stardust shut down in August 2008 for what was then described as a three- or four-quarter delay. As the economy worsened, Echelon was put on hold for three to five years.
Lerner figures its startup timetable depends on whether Boyd succeeds in buying some, if not all, of the assets of Station Casinos, which is operating under Chapter 11 bankruptcy protection.
If Boyd buys at least a piece of Station — and Lerner expects it will — that’s likely to keep Echelon on the back burner.
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Man that Echelon project is one painful thing from day one when the Stardust was still standing and Boyd announced that they were going to close the Stardust and tear it down for this ridiculous project. The Stardust was PAID FOR and PROFITABLE!! This colossal mistake is one which will go down as one for the books in Las Vegas history!! Now all we are left with is an empty dirt blown lot with a steel skeleton. Nice work Boyd..
It is true that we do not need any more guest rooms and gaming devices and positions in this economy. However, many were hoping Icahn's gradual development would create the much needed construction industry jobs which helps fuel our community also.
Five year mothball? It will interesting to see what the weather and the blazing LV summers do to that place. Also,they should have never torn down the Stardust,that was just pure greed.
Fontaineobama
implode the empty buildings write off the loss on your taxes and build an indoor golf driving range; the japanese would love it.
Here's to the Las Vegas Fountainbleu in 2015! Thanks but no thanks.
Hope Boyd doesn't take Stations properties over. They have they have the tightest slots and the blackjack bosses are always on your a__ if you win!
Guru! Shumu! I love it when these anal-ist make predictions for other people. I'de have to think Carl would finish it before five years for one thing he might not live that long! He has to be in his late 60's I'de think.The predictions of the Bleau costing 1.5 billion will be considerable higher to finish it in five years. I think Carl is smarter than everyone thinks! He's hasn't made any statements when he will finish it or what he intends to do with it for now. Let's just wait and see what he has up his sleeve, shall we?? I hate predictions of glum and dume!!!
for you moron republicans--- how about bushfontainefolly-----story of the republican controlled congress and republican president for 8 years of this country which led to more spending than a crazed drunk sailor and then next day blaming everyone else except themselves. You Republicans are hypocrites ---You have no shame and emabrassement after putting this country to brink of economic collapse after 8 years of reckless spending of citizen's treasury. More wicked is letting in crooks like the Greenspan and Henry Paulson to control US Treasury who were appointed by repbulican president. What do you have to say for yourself except blaming everyone ele? Why don't you look yourself in mirror.
Lets build bigger and more expensive casinos when the economy is bad,money is tight,these places depend on conventions,high rollers, how many whales are in the ocean? The Revell on the AC boardwalk is half built and theres a vacant lot where the Sands once stood and these properties sit within a half days drive of zillions of people.
Icahn will be almost 80 years old in 2015...He's really going to wait that long to finish the project? Ridiculous. Why bother?
Carl...retire already. You've got more money than god himself. Let others who really need to work take a shot at it.
This paper wrote article after article claiming the opening of City Center would bring new customers to Las Vegas and benefit everyone.
Now completion of this hotel would just hold down the others during this dire economic time?
Is the Sun on retainer for MGM or are there union issues here?
From a purely visual standpoint, Fountainbleu is an eyesore that has permanently scarred what was once the beautiful skyline of the Las Vegas strip. What were they thinking when the constructed these ugly, oppressive blue towers like this, City Center, Cosmo, and PH Towers?
as he said, vegas will never be back where it was
I don't think he will sit on that much $ for 5 years.Ought to be interesting.....
If everything just froze in 1995, everything would have been fine here today. Greed knows no boundries and the corporate thieves have destroyed what was once the most successful resort formula in the world. Jim Murren go back to NYC, Sheldon, stay in Macau, Harrah's go back to Reno! The only guy who gets a pass is Steve Wynn, even though I'm still angry at him for tearing down the Desert Inn and golf course community. Wynn rescued Las Vegas with the Mirage back in '89.
HEY MRJB; how can u said FOUNTAINOBAMA what did he do to close it it down. the money backing was weak to start with when financial crisis back in 2008 it put a nail in the coffin. it was the developer fault. and greed. just like echelon Boyd had a casino that was paid for. but greed took it toll.
Obama has accrued more debt in one year than bush did in 8 also the unemployment rate was about 5.6% when bush left office. Most of the TARP money has been repaid with interest and obama is using it as his personal slush fund to prop up dems like harry reid instead of returning it to the rightful owners,the people. GM should have been allowed to go bankrupt instead of the taxpayers bailing them out. Yep, were in a big mess but it ain't bush, it's the dems who are causing it.
Damn, some of you Bushies are just friggin nuts!
To: sidpers, Your comment is riddled with false information. Do some research before you post drivel.
Has Disney every considered a park in Las Vegas?
Scenario--Disney Corp. buys Fountainbleu and Circus Circus--puts in Mickey's World-- golf cart mini-golf course Drome, Dinnasours of the Ole West, Future World, etc--no competition for casinos, but a great place to drop off the kids and the nanny! Plug in the bullet train. Bingo, anyone?
vc-riddled with false information? Well, state exactly what is "false".
USA unemployment rate was 7.7% in Jan 2009 when Pres.Obama was sworn in. It was 9.7% in Jan 2010.
NV unemployment was 10.2% in Jan 2009 and was 13% last month.
US Bureau of Labor and Statistics and LVRJ article for last month.
The Vegas casino owners should hire some of the Indians running California casinos. If you go to some of these casinos, it's very hardto find empty slot machine and players are waiting in line. They are very good at luring players in by giving away luxury sports cars, something you can't find here in Las Vegas. We have to give the California people a lot more incentives to drive this way!
I have an idea :
Sell Fontainebleau to the US Government, thats right !
There will be enough space to consolidate and centralize all the IRS centers at one location - file our federal tax returns in no other than Las Vegas Nevada !
It would save the government and every taxpayer plenty of money while employing thousands more and help Las Vegas sustain the broken economy !
Once the old IBM Los Angeles building gets imploded by some other disgruntled pilot taxpayer, it will bring back the nice view of the Las Vegas Strip from the Stratosphere Tower !
No more wasting taxpayer money by politicians, lawmakers and bailing out the rich corporations (that lawmakers have invested in) by enacting even more senseless laws to tax americans a lot more than their fair share !
So you see, the american economy can start over and restructure for the benefit of the american people with a no tolerance policy on hard drugs, stealing and embezzling...in which roughly one third of the population would be executed so that it would not cost us taxpayers wasted money to feed these liars and thieves while there would be less victims.
Thats the only way the Fontainebleau could benefit for all us law abiding citizens.
Repubs want their "grandpa's" America, which is long gone.
And their intolerance makes it difficult for them to relate to what's replaced "grandpa's" America.
Gays used to hide. Now they don't. Repubs can't deal with it.
Minorities used to cower. Now they don't. Repubs can't deal with it.
Women used to tolerate back-alley abortions. Now they don't. Repubs can't deal with it.
The entire free world used to dance to our tune. Now they don't. Repubs can't deal with it.
Repubs are often paranoid xenophobes who perceive our entire existence being threatened by every little shadow.....
And where has all that gotten us? Repubs are going to be running the show again in 3 years. Let's hope they have the balls to set this country on course again. But the only prescription that I can think of that will work is a reverse cultural revolution - and that means executing millions of worthless liberals. Still, it is probably worth doing.
Hey 2dollars that is all you will have by the time this moron gets his ass out of the office
I completely agree with 2dollars-- the longer Republicans try to prevent the inevitable social and cultural evolution of America, the more financial and societal pain will be felt in this country-- look across to other countries who might have been more backwards in the past, but have surpassed the US already in terms of progressiveness today (look at Spain,Brazil,China,Japan). The old US model of the 50's can't be upheld forever. We need to move on, and stand united- not divided. Only if we overcome our internal division and animosities America has a chance to be viable in the future.
And to all the NObama lovers out there. Obama did never criticize Las Vegas as the city with it's citizens. He criticized it's image known from afar. Our image to national and international visitors is excess and being over the top. As long as the money supply was growing that formula worked. But now overspending and excessive consumption has lost it's appeal for the time being-- and Las Vegas has to re-invent itself. History shows we did that in the past--so lets show Obama (and the rest of the world) that Las Vegas can be more than this tired out image of "over the top everything" but has something unique to offer.
At this point, while the Republicans will most likely make in roads in Congress, Senate and Governors, it appears unlikely that they will be able to unseat Obama in the next Presidential elections. The Republicans lucked out when the Dems were unable to properly govern given the huge majority they have,in congress, and failed to push through any meaningful, or unmeaning depending on your point of view legislation over the last year. There is no doubt they will pay the price in November. However if the Republicans fail again during the next year, the Dems could be right back. The Republicans simply do not have a candidate , at this time, able to compete on a National level. Their most likely nominee, Mitt Romney.
cpo --and again you make it sound like a war undertaking. I think this whole two party system blindsides people. I'm not Dem or Rep--and I think more people just don't care about political parties anymore...This will continue as long as they keep behaving like three year olds in the sandbox. Grow up!!
I got news for all you Dems and Repubs, NEITHER party is gonna win the White House next election! It's gonna be a Tea party Independent, And she gonna whoop ass!!!
The article is wrong. Hiring construction workers and then casino employees to finish and operate the Fountainebleau would be beneficial to Las Vegas and Nevada's economy it would only be bad for the corporations that own the casinos.
tforce25 That is exactly what I was about to post.
environprotector How can you see to type with your head so far up your a$$?
Dave Ramsey is run nationally on radio and he says don't gamble, and don't spend money. He is responsible for the recession.
Why isn't that special. A great big hunk o' empty building sitting there empty on the Strip like a great big old pink er bleau elephant till 2015!
one thing BUSH did not put the 8 years he was in office the IRAQ war budget. that the hell alot money
if think this is bad wait til HAWAII makes gambling legsl. we might as will kiss our ass goodby
With the majority of the unemployed centered around the construction/building sector and growth and expansion put on hold it would seem like an ideal time to clean-up the valley with some demolitions.
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If one takes a close look at the building today one would see that the missing panes of blue glass have been sealed up with a different material. Looks like a mothball in progress to me.
I cannot believe the city would let it sit empty for 5 years.Do you think they let you keep a junker in your driveway for 5 years?
surfbh :
I know the truth hurts for you, but mark my words, time stamp this comment, An Independent will take the White House next election..
sad every1 thought the city center will save this city. not. i heard and told city center is like a morgue. every1 in MGM saying how they hire so many people to help the city will let see what happen in 2 or 3 month. are they going to said the same thing.
I'm with perry161492, If Hawaii legalizes gambling, Vegas will be hurt badly.
Who in right mind sink money into this kind of poorly planned and poorly concepted development? It has no distinct features and no theme that would attract the buyers and even casino players. It was a pure gamble and some moron from wolf street pulling fast one with another grandiose scheme of world domination. guess who bought into this stuff and now holding the bag? Guess?---most are yours truly mutual funds. Mutual fund system is most corrupt system to slick money out of your pockets. Don't fall for it. DONT PUT MORE MONEY into the mutual funds. It is losing game and slighly better return odds than gambling. Do your own investing.ANd don't ever listen to republicans. They are all liars and thieves. Nixon for one and since then not one honest one since then.
HEY PERRY! WHAT THE HELL ARE YOU TALKING ABOUT? ARE YOU A RETARD? EVERY COMMENT YOU MAKE SOUNDS LIKE ITS COMING FROM A TEN YEAR OLD WHO FAILED ENGLISH. INSTEAD OF READING "THE SUN" YOU SHOULD BE READING "HOOKED ON PHONICS". PS, WERE YOU HOME SCHOOLED IN A CAVE?
Architecturally, the building really is a blight on the Vegas skyline. It might stand a chance if they lopped off the top half of floors, it might be at least somewhat acceptable to look at. Sad that this project is a complete disaster, and seems like nothing will save it, not even Carl.
how the landscape of Vegas has changed - physically and fiscally...
It's easy to read all the posts when one skips politics. Let's just focus on the topic at hand.
The thought that if Icahn died in five years because he's going to be in his 70's, and therefore the Fountainebleau can't sit in mothballs for 5 years, is laughable. As if his dynasty would die with him. So having it sit there for 5 years or longer as an asset to be sold or developed is highly likely.
Anyone know of a "limit" placed by the City or the County to stop the amount of rooms from escalating? This is pure capitalism and the company that gives good service for a good price with good marketing generally survives.
So let's look at the additional occupancy numbers that Vegas will be diluted with between City Center and the Fountainebleau. Close to 6,000 rooms at City Center between Aria and Vdara. Another 3,812 at Fountainebleau. So that's 9,812. In 2009 there were roughly 149,000 rooms according to the LVCVA with an 81.5% occupancy rate. So the new rooms will dilute the current pool by roughly 6.6% and would proportionately dilute the occupancy rate.
None of this, of course, means anything. With visitors only down by less than 4% in 2009 due to lower room rates, occupancy rates mean squat since they're manipulated by the cost of a room. Vegas could have 100% occupancy at $15 a night for crying out loud -- so therefore, an occupancy rate is not the factor here. Nor is how many rooms are here. What matters is, lest we forget, gambling. So if a $50 a night guest isn't gambling, who cares if the occupancy rate is high? And that's the thinking of the casino owners. The lower rates were to get people to Vegas -- and it worked in 2009 -- but they weren't gamblers so one may ask what was the point?
MGM Mirage has said it will start to raise its rates again in April with what only I can assume to be the hope that if the economy does indeed turn around enough for more people to come that their old habits will stay the same and a higher room rate will be justified. I think they're missing a good bet, (pardon the pun), by keeping the rates where they are and then that guest will take that "additional" room rate cash, and spend it at the tables -- where there's more money to be made over emotion, alcohol and poor judgment.
People blame this President and that President.What you fail to realize it was the corperations and the banks who have caused this economic crisis.
It was predicted in 1998 that this would happen if we did not place some regulations on some of the Deversified Trading on Wall Street.
Back in 1998 I can not remember the her last name but Bonnie who was one of Bill Clinton's
choices for Attorney Gerneral at first then later choes Janet Reno was given the job of head
of one of the watch dogs of Wall Street.Bonnie saw that their was some trading pratices going on that were fishey.She asked congress to regulate these trades but Alan Greenspan and a few other of Cliton's boys tried to sway her from doing so and she still pushed foward.With emense preasure from the big bank execs Mr Greenspan went to congress and convinced them that Wall Street should regulate itself in this area.If this had have passed on through there would have been a small glitch in the economy but we would have recovered quickly.In 2007 Greenspan was called to testify before congress and boldly admitted he was wrong and IIn his belief that the regulation was not needed and that this trading of Deversified trades should have been watched more carefully and the Ponsie schemes went rampid.the sad thing is we had a person who detected the main demize of our economy in 1998 and nothing was done.The ones who got rich are for the most part still are rich The same ones who prayed on the the hard working Americans.Now we blame President's for this economic crises.we look for them to help change the economy but a President can only Propose projects to help stimulte the economy.
The corperations and banks are the only ones who can start the change.They money that the goverment influxed into the banks help stop a complete depression.Big Banks going bust and they were on the edge.we do not realize how close we were.Now in the last year alot of time has been wasted in the recovery due to the focus on healthcare which will not impact the economy effectively if anything It has worsened our economy because the insurance industry is in panic now and rasing premiums rapidly because they know what will happen if this bill passes.
We need Construction to restart and get the dollars flowing again and creation of jobs that could and will start a true turn around.The banks are having to pay debt back right now and are extremly tight of the lending trying to get their debt down before they start stronger lending.here is the problem now the average Americans are do not have money to pay their debt and are going into bankruptcy and loosing their jobs.
My sugestion is that Fountain Bleau/Carl Ichan finish only half the project leaving completion of rooms to less then half and later complete the rest.Create some jobs but in doing so they really need to hire unemployed so we do not have another City Center
One additional comment - The Sun should also count the number of sold, unsold and future condos as rooms that dilute the current hotel pool. At their prices it's obvious these would be for typical wealthy guests that no longer would stay at a hotel but rather their condo which would would be a second, third or fourth home away from home.
Banks and corporation had a big hand in the mess.
But so did the government.
The seeds of the housing bubble was planted a long time ago.
Clinton signed into laws that degegulated finanical institutions.
Also, he appointed people to the FRB to keep interest artificially very low.
Mostly importantly Clinton placed heavy pressure on lending standards to lower lending standards so that minorities could get into homes.
Fannie Mae and Freddie Mac (quasi corp/government entities) were purchasing these risky loans left and right. So corporations were signing up people who probably should not have received a mortgage and sold them to Fannie Mae and Freddie Mac. Corporations made a quick buck with no risk. Fannie Mae and Freddie Mae wrap up this risky loans mixed them with good loans and sold them into complex bundles on the open market.
So all these people signed up for mortgages that they never should have qualifed for one.
That drove up prices for homes and speculators entered the market to flip homes and that drove up prices even more.
Then gas prices went up. People started to lose their jobs and their homes. FRB raise interest rates so people in ARMs could not met loan payments and lost their homes.
The bubble burst and we know the rest of the story.
Financial institutions need to be heavy regulated.
Freddie Mac and Fannie Mae probably should be closed down.
Lenders should be encourage to make solid loans not risky ones just to get minorities into homes.
A request to The Sun's moderators: Any way to block or take down posts that have nothing to do with the article people are commenting on like the one above?
A request to The Sun's moderators: Any way to block or take down posts that have nothing to do with the article people are commenting on like the one above?
you can say what you want about Clinton--- but he left surplus in the treasury.
Bush spent 1.5 trillion in IRAQ alone and also gave away trillons to his croniey oil companies. (war drove up oil prices)
Bush is like this Fontainfolly projet. Sore thumb in American history that will be foreever branded into American psyche as the worst president the Americans ever had. Not so much as what he did but by being a pushover and being manipulated by all his cronies.
Have the government issue tax free redevelopment bonds to buy up old properties and tear them down: Trop, IP, Sahara. People would get a long term land investment on the strip and FB and Echelon could be finished without glutting the area with more rooms. Icahn Boyd etc could buy some of the bonds, etc.
The only way out of this is more Government.
Fontainebleau will be completed and casinos will adapt to the competition. The casino operators have done this to themselves; greed will be their demise. They'll rise and fall just as any industry does when greed overcomes sound business decisions. Sit back and wait, this place will open and sold like a ten dollar hooker, some investment group will lure unsuspecting investors into another get rich quick scheme, the only winner will be Icahn.
What many people fail to realize is that Las Vegas was an adult playground and was the only destination for many to come play and have adult fun. They now have so many choices to choose from, the casino operators have built all over the world and Clark County never planned for loss of tourist revenues and investors only care about how much revenue these operators generate, not how much profit they make.
The other ones who will make money will be the construction company removing all the debris that was buried below the paved lot and concrete batch plant. When Icahn or the new owner decides to expand the parking or add amenities they will encounter around 150,000 cubic yards of buried concrete rubble and debris from the old Wet-N-Wild buried there to save on construction costs of this project.
I will spend my time and money in the MGM properties if they are the only union casinos. I believe in protection for worker's rights. And the service at the MGM casinos is excellent.
Corperation greed has killed Vegas. People I talk to say Vegas is to expensive not like it use to be. Well, when your building billion dollar casino's you have to charge, not like that in the old days. I like Vegas but with 48 states having gambling OUCH
It's an eye sore tear it down.
lol,
"Fontainebleau sitting idle benefits Strip's economy"
Who wrote the headline? It's kind of like saying that my broken ankle makes the gout on my foot not hurt so bad.
VC: The unemployment rate on the fateful nov 7 day when the annointed one was elected was 5.7%. Businesses saw what was comming and started lay off's immediately. By the time the annointed one was elected it was 7.7%. Perhaps you should check your facts before posting.
gdperson has said it best. Vegas will never be the way it was. The world will never be the way it was. Instead of blame, perhaps we should all do what we need to do to save ourselves (i.e. keep your job, start saving money, don't spend unnecessary monies)
You can say what you want about Clinton, but his REPUBLICAN CONTROLLED LEGISLATURE left a surplus in the treasury. If it were up to Clinton he'd have spent it all renovating a brothel in Haiti or something.
The Problem didn't start with Clinton; it started with Obama Sr. (Jimmy Carter). He's the one that started the, lets loosen the lending standards, probably out of white guilt, so that poor an minorities can buy houses. Every administration since has not had the balls to stop this even though the signs that it would eventually cause a major crash were seen even in the early '90's.
As far as the Fountainbleu goes, I said the same thing about City Center, but the Corporate Criminals called upon their dear friend Harry Reid to do some back door dealing for them, and now we have this huge monolith to Corporate Excess that is once again diluting the pool. Yeah it's great that they employed 10,000 people. But what is the average wage? Below living standard I'm sure.
I'm a 3rd generation Las Vegan, and I see the average wage in the hotels being roughly the same as it was in '88. In the same period of time the rents have doubled, my insurance has more than doubled, Taxes are out of control, food, utilities, etc have more closely tripled, car note has tripled, all on roughly the same income. In the same time frame I have gotten a Bachelors Degree, an Associates Degree, and 22 years of experience in my field, but I don't make half what my predecessor made in the same position. And the sad part is for all this extra spending; I have gone from living in one of the safest cities in the US to the Violent Crime Capital of the US.
Thank you Harry. You really have fought hard for us Nevadans, NOT! From your failed policies and back door dealing on the Gaming Control Board, to your failed policies and back door dealing as a Senator. It's always been about you and your Corporate Criminal allies, not us.
zetian has most of the panels for the leaveout areas( crane areas). They may not be available in 2015.
They did not build all these hotel megaresorts just to lure in gamblers, they built more hotel rooms so that more and more visitors of all walks of life can enjoy Las Vegas with a wide range of marketing in order to accomodate for every type of person ....from gamblers, to clubbin partiers, to recreational enthusiests, to conventioneers, to sporting event spectators, sex trolls, etc.
As far as luring 2009 visitors by substantially lowering hotel room rates, that was the only portion of lowering prices the properties had done.... virtually all the one star to five star strip properties ridiculously done overpriced everything else from gift shop items, to food and beverage, to entertainment, to table minimums, and tighter slots than ever before as slot players do notice them kinda things... and management wonders why the revenue numbers aren't good....GREED THATS WHY.
The MAJORITY of Las Vegas visitors are middle class americans who work and make a living (that corporate pinheads seem to forget) and are getting very selective with their spending habits ....Trust me, they would rather NOT PAY $20 for a strip buffet when it was $8 for the same buffet 7 years prior, $15 table minimums when they were $5 before (which means they will gamble away from the strip or somewheres else), $50 to $200 to see a show now when it was only $15 to $90 to see a show 7 years ago, $12 for a Subway sandwich at any hotel food court (other than O' Shea's) when you can pay $5 for the same sandwich at any other Subway location, $300 for a pair of Nike shoes with a made in china tag on it at a ritzy hotel shop when you can buy the same exact pair of shoes for less than $20 at a Walmart, $12 for a beer when you can pay $4 or less at a off strip property, $8 for a 16oz milk shake when McDonalds charges the same size milk shake for less than $3....
With the MINORITY group of upper class foreign and domestic visitors with deeper pockets, you can set a price on anything while they just say "ummmm ok" and buy it if they want it.
The upscale RARE group of rich clientele like the whale is specifically marketed for gambling, which can make or break a property's quarterly figure on a single weekend visit, and to be point blank thats mainly who the corporate sector cares about the most upon luring them in.....what is the point of building a megaresort of enormous debt without luring in whale customers.
The one thing I noticed about megaresorts is the successful ones always had ATTRACTIONS that lured in all visitors, the megaresorts that just have a bunch of expensive priced rooms and expensive restaurants and expensive overpriced shops seem to fail like the New Aladdin/Planet Hollywood did, and guess which three other megaresorts have the same type of non attractions that will not appeal to the majority Las Vegas visitor ? ....[hint] One that just opened last December, and the other one scheduled to open later this year next to Bellagio, and the other one that is featured in this article.
While these overpriced expensive strip properties with greedy bonus pay incentive corporate management would just take note to the majority of the Las Vegas Sun comments time and time again stating to lower the prices on all the food, shows, table limits, shopping, etc., you might attract more majority middle class visitors once again (that can afford to travel at this point) to part with their money in order to get more for their value....I mean, any property that is bought out or built new faces enormous debt anyway, so you might as well obtain increased revenue with a smaller profit margin - which is better than closing down a business establishment with no profit margin due to overpricing, versus high price greedy hope to make some sales scenario.
Like one recent posted comment mentioned, the cost of living in the US over the past 30 years has doubled and tripled or more on practically everything we see or need in everyday life, EXCEPT FOR THE COST OF LABOR.
For all you political junkies out there, for the record:
Carter signed the bill to lower the lending standards, Reagan signed the bill to allow corporate businesses to scave from providing less benefits to full time workers to no benefits to part time workers (which is still in practice today), little boy failure run everything in the ground he was ever in charge of bush allowed businesses to deregulate everything else with little or no opposition while breaking all the ethnics rules of due process that practically crushed this economy, and Obama gets credit for the trillions of debt overspending to keep the economy afloat rather than the economy crashing now instead of the near future.