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CityCenter Condo’s FLYING

Some love and some hate CityCenter.  It’s a big monolith on the Las Vegas strip.  There were such high hopes for this mega-complex to do well, but the poor economy doesn’t seem to be allowing it.  One of the features of CityCenter was the ability to purchase condos at the heart of the strip in either Vdara, Mandarin Oriental or Veer Towers.  CityCenter is fairing “well” relative to general condo sales in one of the hardest hit real estate markets in the country.

Grant Govertsen of Union Gaming Group says CityCenter has closed sales on nearly 200 of 2,400 available units, with total sales of $185 million.

Click here to find  out more! Govertsen says CityCenter has closed an average of 33 units per month, well ahead of the market average of four units per month.

This isn’t really good but, I guess, relative to the rest of the market you can say it is.  I have to imagine that most of those 200 sold were sold to investors looking to flip the condos and were forced to hold on to the condos since the market is so weak.
Expectations were so high for CityCenter that, unless all of the condos were sold by grand opening opening, there really wouldn’t be any satisfied onlookers.
At this pace condos will be sold out in 2016.  Hurry if you want to get in on the action.

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Why Aren’t There Any $5 Tables?

Why aren’t there any (or many) $5 blackjack tables at the casino?  That’s a common question I see on the message boards that I read.  Common sense always lead me to believe there weren’t many $5 table because the casinos don’t make much money on them.  I found some proof of this and thought I’d share.

The chart shows that a full $5 blackjack table only earns the casino about $42 an hour where a $25 table with only two people earns about twice and much.

I didn’t know the math, but this makes sense to me.  Next time you walk though a casino and you see all of those almost empty $25 tables you know why they are there.

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ESPN Zone Closing

Yesterday, Disney announced that they would be closing most of the ESPN Zone restaurants across the country.

It’s unclear what has prompted Disney to close the establishments, although the bars may well be a casualty of the recession. A poll released in March by AlixPartners found that 30% of consumers planned to eat out less frequently, and spend less per meal than they did the year before.

I understand why people would shy away from a bar/restaurant that charges a bit more for average bar food and drinks.  I happen to like the ESPN Zone’s that I’ve been to and there’s always something inside me that wants to install a TV in my bathroom after every visit.

Specifically, I’ve had a great time at the Las Vegas location inside of NYNY.  The NYNY sportsbook is almost non-existent, so I have to imagine that MGM will find another name to slap on the ESPN Zone and re-brand it as something similar to Legasse Stadium at the Palazzo.  I’m thinking that MGM’s relationship with the Light Group will come into play here, but I’m not sure how just yet.

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Fighting Resort Fees…And Winning

At first, I wasn’t so bothered by resort fees but after my recent trip to Las Vegas that changed.  So, it brings me great pleasure to find an blog that shows how a customer at Treasure Island fought back against resort fees…and won!

Yesterday, he sent me an update:

A letter from American Express stated, “OUTCOME – This dispute has been resolved in your favor. The merchant has not yet provided the information necessary to resolve your claim. Therefore, we have issued credit to your account and removed the previously suspended amount, which will reflect on an upcoming statement.”

Folks, remember this when you encounter a surprise surcharge. The hotel may not see things your way. But your charge card just might.

That’s a great point – if the hotel won’t help go to your credit card company to fight if you feel as if you were unjustly charged.  Resort fees make you pay a bit more attention to the price of hotel rooms now.

In fact, I look at all advertised prices in Las Vegas as lies because there is almost always a resort fee added.  I don’t like thinking about money when I think about Las Vegas.

Resort Fees have potential to backfire on hotels in the long run if consumers become more vigilant when choosing a location.  If the consumer is counting their pennies before they travel they will likely count them while they travel.  That can cause less spending.  In the long term this may bit the hotels in the (insert profanity here).

I encourage you to read the whole article for the full story about undisclosed resort fees.

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Station Casinos – Who Ya Got?

A judge OK’d Station Casinos request to sell 11 of their properties in Las Vegas.  Now that they can sell the casino’s who do you think is going to bid for them of the following?

Mentioned as potential bidders are Boyd Gaming Corp, Ameristar Casinos, Penn National Gaming, Cannery Casino Resorts and the Palms.

My money remains on Boyd Gaming, unless they decide to purchase MGM’s half of Borgata in Atlantic City.  So, who ya got?

Fiesta

Photo: Las Vegas Sun

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Andy Rooney is Old. Not Nice. Not Funny. Not Beavis.

Andy Rooney hasn’t been relevant in my lifetime, but people my parents age seem to listen to his musings and take them to heart.  I don’t appreciate his take on things and never will.  This Sunday he took Las Vegas to task.

Evidently it’s morally better to build a car than to deal or play blackjack.  Whatever, Mr. Rooney.  Die is Cast puts Rooney’s comments into perspective.  It’s a good read, as usual.

Whenever I hear Andy Rooney I think back to Beavis and Butthead.  This is another reason I can’t take Andy Rooney seriously.

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First Quarter Casino Earnings

I tend to keep away from corporate casino hotel earnings, but I’ve noticed that there have been a lot of incoming searches for this so I figured that I would round up a bunch of information for those looking.

  • Golden Nugget Reports Increase In Revenue. LV Sun
  • Las Vegas Sands Narrows Loss In First Quarter.  LV Sun
  • Tropicana Reports Loss; Cites Las Vegas “Room Inventory Imbalance”. LV Sun
  • Harrah’s Reports a Loss as Recession Takes Toll. LV Sun
  • CityCenter Pushes MGM Mirage to First Quarter Loss. LV Sun
  • Boyd Gaming Returns To Profit, Notes Improving Economy. LV Sun
  • Wynn Resorts Sees Profit in First Quarter. LV Sun
  • Hard Rock Hotel Reports First Quarter Loss of $26.5 Million. LV Sun
  • Station Casinos Reports Revenue Drop in Fourth Quarter of 09. LV Sun

Each article has is accompanied with commentary.  Check Two Way Hard Three‘s thread for non-local comments.  Non-locals always have a different point of view.

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Imperial Palace & Harrahs High Returns

Imperial Palace (IP) and Harrah’s Las Vegas have the highest return on investment for Harrah’s Entertainment says Gary Loveman, CEO.

• In response to a question about what Harrah’s property is most profitable, he said its highest return on investment normally occurs at properties most often considered low-end entries, such as Harrah’s on the Strip and Imperial Palace.

I haven’t thought about the ROI of each casino property, but this makes sense.

While these aren’t the properties with all the big ticket items, they always seem to have steady traffic and don’t need much high dollar investment.  For example, you’ll never see Kim Karshian getting paid $200,000, or whatever, to hang at IP where she, and others like her, will get big money to appear at Caesars for an event.

Recently I learned that Human Nature is doing bang up business at Imperial Palace – selling 85% of tickets to their show.  I’m not much for shows when I’m in Vegas and I don’t know who would pay for that, but go on with your bad selves!

Happy Birthday Kim

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Station Selling Off Casinos

Station Casinos bankruptcy reorganization is taking place and it’s what most should have expected.  They’re going to sell off some assets to cover their debt.

Station Casinos Inc. filed a reorganization plan in its bankruptcy case Wednesday proposing the sale of its interests in certain land holdings and 13 of its 18 gaming properties.

…The plan, if approved, would lead to the sale of the remaining company assets.

The assets include Indian casino management contracts as well as Texas Station, Santa Fe Station, Fiesta Rancho, Fiesta Henderson, Wildfire Rancho, Wildfire Boulder, the Gold Rush, Lake Mead Casino and the company’s 50 percent interest in Green Valley Ranch Resort, Aliante Station and the smaller Barley’s, the Greens and Wildfire Lanes.

The founding family of Station Casinos, The Farittas’, will still maintain management and a 50% share of the following 5 properties.

Court records show the Fertittas and Colony Capital would pay $85.6 million for a 50 percent stake in the new company holding Red Rock, Palace Station, Boulder Station, Sunset Station, the Wild Wild West and certain land holdings — and that company would assume $1.6 billion in mortgage debt. The Fertittas would manage these five properties.

The properties that are up for sale aren’t very exciting, but would allow a new company the ability to enter the Las Vegas marketplace or allow an existing company the ability to easily grow.

It’s interesting that the Ferritas family would be able to regain some control over the properties that seem to make money.  It will be interesting to see how the new company and properties are marketed when the dust settles.

Las Vegas Sun has much more info on the specifics of the deal.

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Harrahs Buying Palms Next?

New rumor: Harrah’s is buying Palms next.  How can this be possible?  Steve Friess from The Strip Podcast was the first person I saw with this rumor.  After reading his blog and the accompanying Financial Times article it seems as if we have a repeat of how Harrah’s purchased Planet Hollywood.

The piece relies on anonymous sources, albeit more than one, and notes that “the investment points toward a systematic strategy by Harrah’s to acquire other casinos through their distressed debt.”

Friess followed up this with a call to George Maloof, owner of Palms, to get even more information on the subject.

I just hung up with George Maloof, who cast doubt on the Financial Times’ report that Harrah’s has been buying up Palms debt by saying, flat-out: “They’re not going to take over my company. It’s so far remote.”

Great job of digging for info here.  I love the Palms in the same way I love Planet Hollywood.  Maybe it’s the independent nature of those casinos that draws me or maybe it’s the youthful, energetic crowd that both casinos seem to draw.

Mass homogenization of casinos is boring and it seems as if that’s where Las Vegas is heading.  This will create a wider gap for casinos like Wynn/Encore from MGM-Mirage and Harrah’s properties.

There is part of me that will pay for great service and there is another part that loves the comps provided by “The Man.”  I will sit here torn a little as I ponder whether or not I’m going to make it to Harrah’s in Atlantic City.

ALSO: Props to Steve Friess for the info here.  Follow The Strip Podcast on twitter, read the blog for more info and check the podcast.  A great source for Vegas info from a person that’s actually in Vegas.

Copyright © 2017 Marc Meltzer & EDGe Vegas