Moody’s no longer moody on Vegas; Golden Gate upsizes

Caution, thy name is Moody’s Investors Service. So if Moody’s is bullish on the near-term future of Las Vegas, I guess we can well and truly believe that a recovery is here … well, on the Strip. Away from Las Vegas Boulevard, you still might mistake us for postwar Baghdad. In fact, the local NBC-TV affiliate has initiated a series of news segments, prompted by our foreclosure pandemic, entitled The Eyesore Next Door.

Anyway, not only is visitation up 4%, hotel occupancy has increased for the first time in the last four years (i.e., pre-Palazzo). In a reversal of the old Wall Street saw that fortunes would improve with “the next wave of megaresort openings,” now it is the dearth of incoming room product that is seen as the Strip’s salvation, allowing it to absorb the combined supply shock of Palazzo, Encore, CityCenter and The Cosmopolitan. Retiring the Sahara didn’t hurt, either. Room rates have notched almost two full years of sustained improvement — for operators, that is. (Customers might have a different opinion.) Fuel-price increases are the only storm cloud Moody’s perceives on an otherwise serene horizon.

You know times are improving when the sort of batshit-crazy concepts that were routinely floated in the 1990s and earlier in this century — remember Bob Stupak‘s Titanic-shaped casino? — are once again proposed with totally straight faces. Case in point: Speedway Motorsports wants to create a domestic version of the 16-mile Nurburgring race course in or just outside North Las Vegas. Speedway wants to superimpose the following configuration …

… on the topography of the Vegas Valley, with some incursion into Bureau of Land Management acreage implied. Now, I don’t have a pair of calipers handy but if you drew a 10-mile radius around the Las Vegas Motor Speedway (a circle within with Speedway Motorsports 8,000 acres lie), you’d find your options to be damned few: Mountains to the east, tribal land to the northeast, Nellis AFB to the south, then residential development, etc. There’s some empty BLM acreage just to the northwest. Actually, north of the 215 Beltway, you’ve got Aliante Station and precious little else … except at lot of raw land whose owners (including Gary Goett and Station Casinos) would gladly unload. So, wacky as it sounds, this Nurburgring-in-Vegas concept could be the salvation of landowners who were left high and dry by the recession.

Fresh from unveiling new plans and a new name for musty, old Fitzgeralds, owner Derek Stevens is formally announcing the expansion of the historic Golden Gate. In what would be a prodigious display of speed, Stevens is promising “a spectacular 35,000-square-foot, five-story luxury tower with 16 hotel suites, including two penthouses that will encompass the entire [fifth] floor,” an extended casino and a new porte cochere  … all by midsummer!

In addition to high-limit wagering and bikini-clad flair bartenders, Stevens is taking a page or two from the Dennis Gomes playbook (think “flapper”). Hey, if it worked in Atlantic City, why not Vegas? And let’s hope it’s a step up from the overhyped “fetish dealers” at the Vegas Club, who wouldn’t shock a kindergarten class. The small, original — but characterful — rooms in the older part of the hotel will be brought into step with the times, in the form of Keurig coffee makers, iPod stations, flat-screen TVs and improved mattresses. Oh, and don’t forget 3:2 blackjack, the ace up Stevens’ sleeve. Give him credit: he’s a man of deeds, not words — which was more than could be said for the late Don Barden or for Tamares Group‘s seven years of mostly empty promises.