Riviera: Non-story of the year

In what was 2010’s biggest foregone conclusion, Riviera Holdings filed bankruptcy yesterday. This has been coming a long time although the scanty news coverage leaves it unclear whether what’s taking place is the pre-packaged bankruptcy that would see the Riv go to Barry Sternlicht (who might or might not be leading the unspecified “senior secured debtors”) or if the company’s trio of CEOs — 1.5 per casino — will continue to attempt eking out a starvation existence under creditor ownership. Debtors are going to take 19 cents on the dollar, which suggests either great lenience or considerable pessimism about the Riviera’s future.

Not having read the full 18-page ruling from Nevada Labor Commissioner Michael Tanchek, I’m holding my fire on the merits of why he slammed the door on Wynn Resorts dealers. However, the implications for tip-dependent employees in Nevada are far-reaching and dire. “Retail,” the state’s #1 revenue sources includes many small, customer-service-driven businesses — of which I have seen a high attrition rate firsthand. Since a lack of discretionary income is one of the factors depressing Nevada’s economy, widespread raiding of tip income by management would worsen this situation and perhaps even spark the dreaded “double-dip recession.”

Since Sheldon Adelson keeps pinning his investors’ hopes on raising capital through sales of Venetian Macao‘s Grand Canal Shoppes and the nearby Shoppes at Four Seasons, he might do well to put a sock in it. Asia Times reports that Macao is maxed-out on high-end retail. That’s not deterring developers like Pansy Ho, whose joint venture One Central ties into MGM Grand Macau and an adjacent Mandarin Oriental.

“Spending and traffic are not as closely aligned as you might expect,” says another developer (words that could, in an inverse sense be applied to the Las Vegas Strip). They better not, as reporter Muhammad Cohen finds Adelson’s malls to be ones where “staff [is] vastly outnumbering customers” for whom retail is “mainly a climate-controlled space for residents and tourists to pass time.” You can just feel the asking price on those “shoppes” falling, can’t you?

Who likes gambling? That’s basically the question posed by Marc Dunbar, who’s running down Bible State political races and their implications on the casino industry. (Thanks to reader detroit_1051 for tipping me off to this new resource.) The marquee event is the Alabama gubernatorial contest. If it comes down to Agriculture Commissioner Ron Sparks vs. Robert Bentley, it’s all good for the state’s electronic-bingo industry. The phrase “Gov. Bradley Byrne” will, however, plunge it into a slough of despond.

Hardly Gaughan. During his brief, unhappy tenure running a fiefdom within Boyd Gaming, maverick Michael Gaughan arguably went a bit overboard, building Phases I and II of South Point simultaneously. But the market caught up with him and Phase III followed three-plus years late. Now, we’re onto a Phase IV, for a mere $20 million. (Gaughan was always careful to leave himself plenty of room for expansion.) Although Gaughan has been one of the loudest grumblers about changes in consumers’ spending patterns, he’s also been one of the few casino operators to successfully adapt to meet them.

Harmon(ini) Watch. It will only take 12-16 weeks to remedy the structural deficiencies of the Harmon Hotel, says culprit Perini Building. Maybe so, but would you feel comfortable even walking into that building, knowing its deeply troubled history? Of course what Perini can’t do is restore the two-dozen stories that had to be aborted, due to the incompetence of the clowns it hired to build the place. It looks more and more like MGM Resorts International is trying to position itself for a huge writedown, followed by a quiet conversion of the Harmon to office space — or perhaps a tear-down of this albatross around its neck.

(Speaking of watching stuff named “Harmon,” did anybody catch Angie Harmon‘s new series, Rizzoli & Isles last night? I missed it. Good? Bad? Meh?)

Singapore’s two casinos are driving unprecedented tourist traffic into the city-state and helping propel bigger-than-expected economic growth. When governments use casinos as an instrument of policy objectives, it’s a course fraught with peril but Singapore‘s gambit is already paying off handsomely. Congratulations.