Sands backslides, backpedals in Pennsylvania

Wow, there’s nothing like the rumor of an in-progress sale to light a fire under Las Vegas Sands to restart its desultory Sands Bethlehem. Sands CEO Sheldon Adelson tries to imply that resumption of the hotel is contingent upon getting table games (he’s obligated to build it, table games or no) but this is still a double-reverse from LVS.

When table games were still before the Lege, Adelson led people to believe that he’d restart hotel construction once the games were approved. Then Adelson’s $2 Million Man, COO Michael A. Leven said he “would wait until the end of the year before even considering resuming projects such as the Bethlehem hotel, mall and conference center.” [emphasis added]

Quite a different story. One can attribute Adelson’s sudden zeal to resume work either to A) a news leak scaring off an imminent buyer or B) a behind-the-scenes political shitstorm and my money’s on B. Sands’ promised (but not contractually obligated) museum has always looked like a long shot and now will probably never be built, and — having overspent on the casino — LVS is understandably trying to incur as little more self-inflicted damage as it can.

As for the $743 million casino, its return on investment is poor and likely to be poorer still once additional construction costs start rolling in, possibly pushing ROI into the negative. But Adelson made a promise to the State of Pennsylvania and the City of Bethlehem, and now he has to keep it. This may be a (very expensive) “teaching moment” for Sands, the lesson being that you don’t spend Vegas-sized bucks in non-Vegas (or Macao) markets, but it’s never too late to learn.

Anybody with even a cursory understanding of the Las Vegas casino market could have told the developers of Casino MonteLago that failure was inevitable. Even had the promised 9,000 homes been built at the Kingdom of Make-Believe (aka Lake Las Vegas), that’s pretty low critical mass. Not to mention that the casino was rather discreetly tucked away in Lake LV and to even get there you had to drive all to Hell and gone, passing straight by several casinos en route. PDS Gaming‘s Johan Finley may told regulators his firm had increased operating profit by 80%, but since he also said Casino MonteLago had been operating in the red … well, any increase on nothing is statistically huge.

Same old ColSux. The picket lines continue to spread across America. Can there be any further doubt that this would have been the endgame at the Tropicana Las Vegas had William J. Yung III‘s reign of error not been cut short?

Jim Gibbons seems to think that the only new casinos being developed in Nevada are being done by companies from out of state (roughly at 4″ in). Go figure. His presumption that Nevada Gaming Control Board auditors can be corrupted by a new fee potentially imposed on casinos to underwrite NGCB audits is both naive and blithely insulting to state regulators. Also predicates 2011 budget on an economic recovery. From your mouth to God’s ear, sir.

Massachusetts’ protracted push toward casino gambling is proving very, very good for lobbyists. Big spenders include Harrah’s Entertainment and Sands. No surprise there.

We’ve found a recession-proof segment of the Vegas economy … and it’s booze. Stay thirsty my friends.