In the case of the two properties you mentioned, the age of the hotel towers may be a factor. Actually, it’s not a "maybe" at Binion’s, whose 366 hotel rooms were closed in 2009. General Manager Tim Lager says a full remodeling is mandatory before the hotel can reopen. "We’re going to strip down to the concrete. All the pipes are rotten," which means replacing the heating and air-conditioning ductwork, along with those water pipes. Removal of asbestos is another factor retarding renovation. "It’s amazing how expensive it is," Lager says of the remodel. "We’d love to give that [reopening date] to you but we’re just not that far. I don’t want to get anyone excited, like something’s going to happen tomorrow … there’s no timeline right now."
Compared to the refreshing candor we encountered from Binion’s management, the Las Vegas Club offered only a canned paragraph of PR: "We are happy to see the continued interest the Las Vegas Advisor’s readers have in the Las Vegas Club. With the rapid growth and changes happening in downtown, we agree that there are great opportunities for the property. We are evaluating these opportunities and hope to have news to share in the near future."
Before getting into speculation, it is worth noting that owner Tamares Group does not have a history of reinvesting in its downtown casinos, of which only the Vegas Club and Plaza Hotel remain. The Plaza* got a $20 million facelift but the Vegas Club has steadily declined into a grind joint. LVA reader "herbop" stayed at the Vegas Club in its waning days and reported, "While other Downtown hotels are installing in-room safes, and removing complaint-causing daily fees for same, the Vegas Club Hotel has pulled out the installed safes from its rooms. When I inquired, they said it’s ‘policy.’ Guests can still use the casino’s safe deposit boxes. They left the four bolt-holes in the wall, unpatched. Classy, right?"
When asked in the course of a March, 2012 interview with the Las Vegas Review-Journal, "Do you have any plans for the Las Vegas Club?", Director of Las Vegas properties for Tamares Real Estate Jonathan Jossel responded, "It's kind of the same as the Western. We have ideas, we have concepts, we just finished the renovation on the Plaza -- it's still ongoing, we're still putting money in it. As soon as this is done, steady and stable, we'll turn our attention to Las Vegas Club and the Western." That was two years ago, since when the Western has been shuttered and sold, while attention still remains focused on improvements to the Plaza, so while LVA would applaud a revival of the Vegas Club, we’re not holding our breath for any moves in that direction anytime soon.
In addition and to keep things in context, Chris Jones, analyst for Union Gaming Group, points out that – even with visitation higher than ever – there is 13 percent more hotel-room inventory in the market than at Vegas’ previous apex, in 2008. Total average daily rates and revenue per available room "is still well below where we were at prior peak and, for some of the operators, that’s the biggest rub. Some segments of Vegas are seeing more of a recovery than others." He adds that there’s "a pretty significant spread" between what you can make off a hotel room on the Strip versus one downtown. Also, Asian players and electronic dance music fans (i.e., the nightclub crowd) prefer to stay on the Strip, closer to the center of the action. Finally, the downtown revival has been driven largely by business from locals – not a customer base that needs hotel rooms.
As an addendum, we would add that since we initially researched this answer, some new developments have come to light with regard to Tamares Group and its downtown casino properties, not least the recent awarding of a non-restricted gaming license to Jonathan Jossel, and we fully expect to see some more proactive measures being taken at the Plaza, and possibly also Las Vegas Club. We can't say much more for the time being, but stay tuned!
