Bye, bye, Vegas Club; Murren accepts minority status

One of our favorite sources, VitalVegas author Scott Roeben, is interviewed at length by Nevada Public Radio on what, if anything, the introduction of virtual reality to the Las Vegas Strip means for the big casinos. In part, Roeben says, “the casinos are at a bit of a loss, and they’re trying kind of what they see working elsewhere and are hoping they will work in their establishment … To [MGM Grand‘s] credit, they keep trying. They’re trying new things. They’ve got the virtual reality now. They’ve got a golf game that is kind of a 3-D, interactive golf game. They’re trying a lot of different things, but nothing has quite clicked yet.”

On other topics, Roeben is more optimistic than we are about Fontainebleau, less so about Resorts World Las Vegas and predicts that Lucky Dragon will be on the sale block soon. (Another acquisition for SLS Las Vegas buyers Meruelo Group?) In other news, Ghostbar has closed at the Palms and the casino portion of the Vegas Club has been gutted — no bad thing, that. Roeben predicts that the demolition of the of the Vegas Club’s two hotel towers, to give Derek Stevens “a blank slate” with which to remake the terminus of Fremont Street. Hint: Expect swimming pools.

* In an address to the Bank of America Merrill Lynch 2017 Japan Conference, MGM Resorts International CEO Jim Murren bowed to the inevitable and said he would “commit to being a good partner to Japanese companies in a Japanese-led [megaresort] consortium.” He also pegged the opening date as being in 2025. MGM already has a spiffy new design for the project, one each for Tokyo, Yokohama (shown) and Osaka. (If Sheldon Adelson gets in, expect him to plop another big-ass Venetian on Japan.) Murren had reason to be confident, as media reports say Prime Minister Shinzo Abe‘s Liberal Democratic Party has gotten the oft-recalcitrant Komeito Party to swing into line on the passage of the essential casino-regulation bill. However, optimism should not tip over into giddiness: A new Nomura Securities report sizes up the Japan market as being no larger than $7 billion a year, presuming two megaresorts.

In other MGM news, the company is rolling the cash from its sale of MGM National Harbor to MGM Growth Partners into stock repurchases. The late Kirk Kerkorian‘s Tracinda Corp. has some to sell, as it announced it would offloading 10 million shares, taking its amount of the company down to slightly over 8%. CityCenter partner Dubai World is also in a selling mood, having dumped some 5.2 million shares last week, news that trickled out after the market closed on Friday, no doubt to the benefit of MGM’s stock price.

* Sticking their heads firmly in the sand, major Strip operators boycotted a conference on e-sports, which makes virtual reality look like penny-ante stuff. Native American casino operators dominated the crowd of 175 at Westgate Las Vegas. “It is extremely hard to turn a battleship,” conference leader Ben Fox remarked, alluding to the old-school mentality of the big casinos and the quicker adaptability of regional operators. At least MGM has the excuse of having already dedicated the old LAX space at Luxor to an e-sports arena but why were the supposedly with-it likes of Wynn Resorts missing in action? Maybe they scorn the e-sports player because he’s too young to drink or gamble and too penurious to afford high ADRs. The Tropicana Atlantic City recently jacked up hotel rates for an e-sports tourney, the Las Vegas Review-Journal reports, and players stayed away in droves. Ditto Trop restaurants.

Downtown Grand CEO Seth Schorr pushed back against conventional wisdom saying e-sports is the coming thing and “in 10 years from now is going to compete with major sports” for audience appeal. While the bigger casinos wait and see, Schorr has been studying the market for two years and preparing the Downtown Grand to be a “boot camp” for the e-sports crowd. To go out on a limb, Schorr will likely be remembered as having been a visionary while the competition merely napped.