Some Veer owners uncomfortable with policy of renting their units

By Liz Benston

Friday, July 16, 2010 | 2 a.m.

Potential buyers of condominiums in CityCenter’s Veer towers are having mixed reactions about the prospect of being allowed to rent out their units for a minimum of six months.

Although the policy appeals to prospective buyers seeking to recoup some of their investment costs, it isn’t sitting well with some buyers who fear it will give the luxury residence a transient feel.

Although upscale condominium towers allow rentals, “most noninvestors would prefer to have longer-term rental periods, such as a year or more, whereas investors would have the opposite mentality,” says Bruce Hiatt, a broker with Realty One Group in Las Vegas. Concerns about rentals are understandable at Veer given that it was marketed as a residence rather than an investor property, he adds.

The six-month minimum rental program, which has always been the plan for Veer, is standard practice for condominiums, MGM Resorts spokeswoman Yvette Monet contends. It’s appropriate given that the units are considered homes rather than short-term rentals that can be rented daily, like condo-hotel units, she says.

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A casino analyst at CB Richard Ellis in Las Vegas predicts a huge windfall from online poker if it is legalized in the U.S.

In a report to be released soon, Jacob Oberman, CB Richard Ellis’ director of gaming research and analysis, estimates websites will generate $8 billion to $10 billion from online poker players in the United States by 2014 if the likes of Harrah’s Entertainment and MGM Resorts put marketing campaigns behind them and if they are taxed at “reasonable rates” acceptable to operators.

These billions are all the more significant because of the tiny profit margins involved in casino poker. Nevada casinos often make only about $4 per player per game. With less overhead and more volume, online poker rooms have an even smaller “rake,” and might keep only a couple of dollars per $100 pot.

Online poker is generating more money from Americans today than it was before the 2006 passage of the Unlawful Internet Gambling Enforcement Act, which further criminalized online gambling by making it illegal for banks to process online gambling transactions, CB Richard Ellis says. The law went into effect June 1. Americans have found other ways to deposit money in Web casinos despite the law, which made it more difficult to gamble online by prohibiting the use of credit and debit card transactions. Online poker currently generates $2 billion annually from Americans versus about $1.6 billion in 2005, a year before the law passed Congress, the report says.

“U.S. players are still the backbone of the online poker industry, and whichever site(s) capture the imagination of the U.S. market will ultimately dominate the global market given that poker is a game driven by liquidity,” says Oberman, who previously put together feasibility studies for major gaming companies, including Strip operators. His report cites figures from London-based research firm Poker Players Research that 10 percent of the U.S. adult population played poker regularly in 2007. Three percent of Americans are playing online poker for real money at least once a month, the London firm says. That figure would probably be higher if not for the recent banking restrictions, which have chilled online gambling for some casual players, Oberman says.

He expects 7 percent of the U.S. adult population to play online poker if it is legalized.

This is good news for bricks-and-mortar casinos, Oberman says, because most online players will want to try their hand in live casino games and will also play other casino games such as blackjack, which are more profitable for casinos. According to Poker Players Research, 92 percent of online poker players who play in brick-and-mortar poker rooms also play other casino games, Oberman notes.

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South Point owner Michael Gaughan says competitors have a right to question his modus operandi amid the worst economy in the modern casino era.

While other casinos were scaling back operations, Gaughan forged ahead with his long-planned, 43,000-square-foot casino expansion that opens today with a poker room, race book, entertainment lounge and 400 additional slot machines. A new fast-food restaurant, Steak ‘n Shake, is to be added in the fall.

The $20 million expansion shouldn’t be taken as a sign that business is improving, Gaughan says. Although the property’s convention business — decimated in the poor economy — has been picking up somewhat, overall business is flat, Gaughan says. He’s not bullish on the economy. He just wanted to make use of space that had long sat idle. The expansion will add only 50 employees, but it will also allow Gaughan to extend hours for some workers whose hours had been reduced in the downturn.

This follows another against-the-grain move to increase the payback percentage on his penny slot machines in an effort to extend play time for customers who are expected to lose their bankrolls anyway.