The annual Las Vegas Advisor Report Card, which we publish in the January issue of the newsletter, is pretty sparse this year. In total, it has 39 entries, the least since 2002; by comparison, last year’s had 63, 2008’s had 82, and 2007’s had 92.
Also compared to previous charts, which had numerous entries in the Opening, Expanding/Renovating, and In Progress categories, this year’s contains one casino opening in 2010 (Cosmopolitan) and one casino renovating (Tropicana). Also opening in 2010 are the first phase of Tivoli Village, a glorified shopping center in Summerlin, and the Hoover Dam Bypass bridge; in progress is a long-range airport project, a new terminal scheduled for completion in 2012. And that’s it for the near future.
We categorize the indefinite future in the On the Drawing Board category. At the height of the boom, with announcements of multi-billion-dollar projects an almost daily event, Drawing Board contained dozens of possibilities; the 2006 chart, for example, held 26 entries, while the 2007 Drawing Board had 34. This year’s has a grand total of seven and only one is a major casino (and a highly speculative one at that).
Meanwhile, in the Postponed/Canceled category, we list 10 projects, and that’s after a different 10 in last year’s chart. This year, the only one that looks like it’s postponed, as opposed to truly canceled, is Fontainebleau.
Which brings us to the specific answer to your question. In the Couponomy column of the current January LVA, Anthony Curtis compares Las Vegas to a boxer who's been caught off-guard: staggered, but not stopped. He first points to CityCenter, which isn’t completely open; Veer opens in March and work will continue on the Harmon throughout the year. In addition, it’ll take months and months for the impact of the huge CityCenter to resolve. Cosmpolitan looks like it will open toward the end of the year; Cosmo is a megaresort by anyone’s standards. Tropicana is undergoing a extreme makeover. Hard Rock continues to unveil its expansions. And one of these days, Harrah’s will recommence work at Caesars on the interior of the Octavius Tower.
Then there’s Fontainebleau. With Carl Icahn (and the billions he netted from his shrewd investments in Stratosphere and the Charlie’s) in the hunt, he could easily pick up the stalled project this month and finish it this year or early next year.
So, although it seems that Las Vegas might be down and out, as Anthony says, it might be a bit down, but it’s certainly not out.
As for trends, the big side story, of course, is the hotel-room inventory. CityCenter just added nearly 6,000 rooms to the already huge total. The just-opened PH Towers at Planet Hollywood bring another 1,201 rooms. HRH Tower at Hard Rock added 374. And only a couple months ago, Rush Tower opened at Golden Nugget with another 500 or so. Caesars’ Octavius Tower holds nearly 700. Cosmopolitan has roughly 2,500 and F’bleau 3,000; together they total nearly as many as CityCenter itself. That’s more than 8,000 rooms, not including CityCenter, getting dumped into inventory in the next year or so.
Meanwhile, Binion’s, Sahara, Mirage, and others have been closing rooms due to the glut and highly deflated prices; it’s more cost-effective not to make them available at all than to try to fill them. What happens to room rates across the board, from the Ritz-Carlton Lake Las Vegas to the El Cortez, from the Mandarin Oriental to the Vegas Club, will be the major trend this year and, presumably, for years to come.
