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Las Vegas Housing Market Back On Upswing

Summerlin Las Vegas Road

Road To Nowhere

I generally keep this blog to casinos, gaming and travel between Atlantic City and Las Vegas but every now and again I’ll sprinkle in a taste of life I find exploring Vegas. I typically end up in casinos or other toursity spots so this works well. A few weeks ago I was driving around the suburbs drinking coffee on a beautiful Sunday morning when I noticed that formerly barren corners of Las Vegas were beginning to get some action. I thought this was a sign that something was happening but wasn’t sure what to make of it. Yesterday we got this news:

U.S. home prices spiked 10.9 percent in March compared to the same period a year ago, with all 20 cities measured in the most recent Standard & Poor’s/Case-Shiller housing report posting positive year-over-year growth for the third month in a row.

Phoenix has the largest annual increase in annual prices at 22.5 percent, followed by San Francisco with 22.2 percent and Las Vegas with 20.6 percent. Boston annual prices rose 6.7 percent, according to the report.

The increase in housing sales explains the activity I’ve witnessed in my corner of Vegas. The drive on this Sunday morning took me to the edge of civilization and the Red Rock mountains. I imagine that this land, like much of the other land around it, was probably desert just a few years ago before the last Vegas building boom. The road to nowhere on this day shows where the building ended (left side of the street) and where building has ramped up again (right side).

Long Road To Nowhere Las Vegas

Las Vegas is still new to me since most of my travels end up in casinos and I often end up taking roads to nowhere when I want to clear my head. These are roads where the Las Vegas boom just stops. Roads are unfinished and there partially started construction sites. It’s kind of sad but also kind of cool to look at because it’s something I’ve never seen before.

End Of The Road Las Vegas

The road to nowhere above used to just end. There were no machines moving and nothing happening. This Sunday morning they were resting like normal people…err machines but have been working during normal work hours. Looping back you can see that houses are being worked on right now.

Nowhere House Las Vegas

The construction out in the Vegas burbs has resumed and that’s a good sign of the Las Vegas economy. The Vegas strip has also begun preparing for an improved economy with construction resuming last year with The Linq and this year with MGM and SLS Vegas construction.

The next boom in Vegas won’t be as extravagant as when CityCenter, Cosmopolitan, Wynn and Encore where built but new activity on the strip and in the burbs can only mean good things in the near future for both Vegas and Las Vegas.

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The Linq Announces Exciting Tenants

Caesars Entertainment announced some more tenants for The Linq and it’s as exciting as you’d imagine.

…the Yard House restaurant aims to slake the thirsts of beer fans, while the Asian-themed F.A.M.E.— for food, art, music and entertainment — market will offer sushi, dim sum, noodle bowls and robata grill foods to patrons in lounge seating and street art from urban Hong Kong, Tokyo, Singapore and Seoul.

Other tenants include Sprinkles, a Los Angeles-based cupcake and ice cream shop; Flower and Barley, a brick oven pizzeria; Koto, an oddities and gifts store with outlets in Miami and Aspen, Colo.; and Off the Strip, a bistro and bar.

Caesars customers tend to be your average consumer. People from the coasts might say that Caesars markets to middle America. These are the blandest of the bland consumers. Your average mall shopper.

This person is the polar opposite of who The Cosmopolitan is trying to reach. Caesars customers are not young, cool or looking for anything new and interesting. I like Yard House, but this is a perfect example of what Caesars customers want. They play classic rock and serve beer. What says middle America more than that?

It’s cool, we’re not all the same and that’s cool.

Caesars has filled 12 of 18 spots in The Linq shopping and eating area with a year or so to go before opening. This seems very similar to the rate MGM acquired tenants for Crystals at City Center. That’s not bad.

I’m not going to predict success or failure until The Linq is open (if it opens), but the initial tenants show me that Caesars knows who their customer is.

There are still 6 spots left at The Linq and I’m hoping for Speaker City to be one of them.

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I Hope This Doesn’t Mean 6:5 Blackjack Is Coming To Venetian and Palazzo

Venetian Blackjack Table

Venetian Blackjack Table

I was doing my weekly catch up on Las Vegas news on Sunday when I saw a post on Wizard of Odds that made me cringe a little.

A little background first. Wizard of Odds is my go-to for any gaming odds and strategy. I source their information often. In fact, when I wrote about where to find the best blackjack in Las Vegas for Vegas Chatter I used their information.

I didn’t realize that Michael Shackleford worked at Las Vegas Sands (Venetian & Palazzo) until I read that he was no longer working there.

Let it be known I am no longer working for the Venetian. It would be an understatement to say that my feelings about the termination are acrimonious.

…I started with the Sands corporation on April 30, 2012. My job title was Director of Gaming Mathematics. Physically, I worked in the Venetian, but my job was at the corporate level, pertaining to all things table games in all the Sands casinos worldwide.

Venetian and Palazzo both have some of the best blackjack that you will find on the Las Vegas strip. Specifically, Palazzo is my favorite place to play blackjack on the Vegas strip.

I’m not sure if Mr. Shackleford is the reason for the good blackjack, but I’m sure it didn’t hurt. The rest of their games are strip average at best. Venetian and Palazzo’s 3:2 blackjack dealt from a shoe for all denominations stand out from the Continuous Shuffle Machines at MGM properties and the 6:5 blackjack at Caesars properties.

I hope Mr. Shackleford’s departure from Las Vegas Sands doesn’t mean that the blackjack will go away too. Even though I don’t know him I wish Mr. Shackleford the best.

 

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Phillies Now 60-1 To Win World Series at Caesars

There’s been a lot of movement since Sunday’s bets on the Phillies to win the World Series.

Here’s a refresher in case you missed the previous article. On Sunday a friend and I each bet $20 on a futures bet for the Phillies to win the World Series at 1,000-1. As I shared, he bet first and after contemplating the wager I ran to the Planet Hollywood (owned by Caesars) sportsbook to place my bet before the odds changed.

I was half joking when I said that our two $20 wagers would move the line. This morning a friend asked me to place two more wagers for him. These were $30. Again, not big bets just more fun bets.

At the time Rio (also owned by Caesars) was 200-1. At 7pm on Tuesday night the line was down to 60-1 at Caesars properties. The line was 150-1 at MGM properties and at sportsbook.ag.

I’m not sure our hundred dollars of bets really moved the line, but it’s possible and this bet has already been more fun than any baseball bets I’ve made all year. At the same time, the Brewers were 500-1 to win the World Series on Sunday at Planet Hollywood and still there this morning at Rio.

With both teams winning last night, I have to imagine both the Phillies and Brewers will get continue to get money bet on them. The Brewers odds went from 500-1 to 250-1 to win it all and should continue to fall, while the Phillies will probably get less money and settle at 60-1.

I’m obsessed with this bet. If you follow me on twitter you know this. #GoPhils

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Rumor: Which Vegas Casino Filed Chapter 11?

Dave McKee from who writes the awesome Stiffs & Georges blog threw out an interesting question on twitter this morning about a Las Vegas strip casino going belly up (or restructuring debt) by filing Chapter 11.

He didn’t say “Company” so you rule out MGM Resorts, Venetian/Palazzo, Wynn or Caesars properties immediately. Duetche Bank has been looking to sell the Cosmopolitan before the end of the year for a while now so you can understand why that’s not in the running. That doesn’t leave many properties to left on the strip for possible Chapter 11.

Who ya got from the remaining strip properties?

  • Tropicana
  • Casino Royale
  • Riviera
  • Treasure Island

Unless Phil Ruffin is looking for a tax write off, I don’t see him divesting of Treasure Island so soon and I haven’t heard a peep about Casino Royale ever.

That leaves Tropicana and Riviera as possible casinos to file for Chapter 11. Both have had financial trouble, but after a relaunch of the Tropicana went nowhere and President Tom McCartney left there hasn’t been much positive good talk about the property. In fact, the only real news from Tropicana has been about it’s club not opening.

Meanwhile on the other end of the strip Riviera has been trying to create a niche for itself with constant marketing and promotion. I’m not sure this is working, but it’s difficult to imagine that it’s not helping. Of course, it may not be working which would give cause for Chapter 11.

I don’t think silence is can’t be a good thing here and I’d have to imagine that Tropicana is the strip property about to announce Chapter 11.

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MGM Resorts, Caesars Entertainment, Cosmopolitan, LVS, Wynn Casino Earnings

MGM Resorts International (corporate name), Caesars Entertainment (corporate name), LVS (Palazzo & Venetian corporate name), Wynn (corporate and real name) and Cosmopolitan (not corporate name) all recently reported earnings from the last quarter in the past week. Here’s a quick recap.

Even though they are still losing money the increases in revenues at Cosmo are impressive. – especially while every other company in Vegas lost money.

Each casino (company) section links to an article with more detailed information if you care to read more.

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MGM Resorts Jim Murren on CNBC

MGM Resorts International CEO was on CNBC today discussing Las Vegas and their company.

Some highlights include:

  1. 2012 will break visitor records in Las Vegas.
  2. Online poker will become legal in 2012. Either state by state or nationally.
  3. Will spend $2 mm – $2.5 mm in Macau.
  4. Aria convention space sold out.
  5. Social gaming discussion – Farmville on the strip.

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Rumor: Caesars and MGM Merging?

The Seven Stars Insider newsletter is always chock full of interesting information. In the December edition posted last week there was a particularly interesting nugget of information that you may have missed.

MGM-Caesars Merger?
My e-mail receipt from a late-October stay at Caesars Palace came from “MGM Caesars”:
Could this be a hint of what’s to come?

I haven’t heard or read about a potential merger between MGM Resorts International and Caesars Entertainment anywhere, so I’m not sure there’s much smoke to this rumor but it’s certainly interesting to think about.

I’m not even sure that the government would allow this merger because, essentially, it would create a monopoly on the Las Vegas casino market with about 90% of the strip being owned by one company. It would also probably be considered a national monopoly, but I’m not sure of that.

It’s interesting to ponder a merger of this size, even if it may never happen.

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BOOM: There Goes The Harmon!

To no surprise, it looks as if MGM will be imploding The Harmon – aka “The Largest Billboard in Vegas.” Here’s the scoop from 8 News Now.

8 News Now has learned that CityCenter is submitting proposed plans to Clark County to implode the troubled Harmon Tower.

MGM Resorts International has said it has safety concerns about the unfinished tower and is currently involved with a lawsuit with the builder.

Construction halted on the Harmon Tower in 2009 after MGM claims they found major construction defects. Perini Construction blames MGM’s engineers for a bad design, but adds Harmon is stable and all problems can be repaired.

A report released last month by Clark County’s Building Division says Harmon could completely collapse in an earthquake.

No surprise, not really even news. I just like implosions. BOOM! Note, video audio is NSFW

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What Do People Do at Cosmopolitan?

The Cosmopolitan of Las Vegas reported 2nd quarter earnings today and it gives a small look into how the casino earns it’s money.

Sequentially, results from the property’s casino declined from the first quarter. Gaming revenue in the second quarter of $28.2 million was down from $31 million.

Hotel revenue in the second quarter of $45.9 million was up from $34.4 million in the first quarter thanks to the extra rooms, strong room rates ($246 on average) and occupancy trends (91.4 percent on average).

Food and beverage revenue at the property, known for its restaurants and nightclub offerings, continued to generate the biggest chunk of revenue — $70.1 million in the second quarter v. $57.6 million in the first quarter.

So, people continue to stay and eat and drink at the casino but don’t gamble – in fact they’re gambling less than the quarter before. This is no surprise and from what I’ve seen it won’t be changing any time soon. The gaming promotions they’ve started are aimed at the small player and while that’s a good start, it’s not going to show any immediate effect. It looks as if they are changing some of their focus towards big players.

The company said the second quarter results included a $2 million charge to write off the value of a lounge, which will be demolished to make way for an additional high-limit gaming area. The 9,600-square-foot area will include 15 table games and is expected to be completed by November.

So they’re going to add high limit tables to a place where people don’t gamble. Does not seem like a smart move. I’ve never seen anyone playing in the high limits room, but I’m not at Cosmo 24-7 so what do I know. Maybe they’re playing between 3am and 5am like the high rollers in every other casino. Yes, I’m mocking.

I still don’t understand why the Cosmo won’t add a poker room. It’s another way to draw gamblers who will eventually play other games.

For as horribly as the Cosmo has marketed their casino to gamblers, I love it and will be back shortly for a bite to eat, a drink, a show and maybe a little video poker. As noted above, food and beverage is doing well. It’s easily their best feature and what keeps me coming back. Hopefully they get their stuff together so I can enjoy the place before they’re forced to see to Caesars or, more likely, MGM.

Copyright © 2017 Marc Meltzer & EDGe Vegas