Morton Grove, IL. Lying low while Black Friday sweeps Chicagoland …
You will remember that, when CityCenter teetered upon the brink of bankruptcy earlier this year, it was saved by a compromise that put the onus on MGM Mirage for any cost overruns. At the time, it looked like MGM came out the loser in its showdown with partner Dubai World. Well, maybe not. If CityCenter’s price tag increases, you wouldn’t want to have to wait around for Dubai World to pick up even half the tab.
Sobering thought: Not only is Las Vegas adding as many hotel rooms in the 2009-2011 period as it did from 2001-2008 (eight years of growth packed into three), it will need to generate 3.2 million visitors to fill them. Barring an economic miracle, that seems a pretty tall order — especially amidst the Great Recession. If ever the phrase “irrational exuberance” applied, it would be to the casino industry’s expansion-and-LBO mania that produced this incredibly un-propitious confluence of new product, big debt and a bad economy. The men who run these companies aren’t idiots who couldn’t read the warning signs. Judging from their own after-the-fact rationalizations, they simply chose to ignore them, borne on a wave of optimism that proved reckless … or worse, judging by the economic havoc that can be found just a block or two beyond the Las Vegas Strip.
Cirque du So Late: Is there trouble under the big top? A media preview for Viva Elvis was quietly scrubbed and ticket sales for preview performances only went on sale in the last 48 hours. Which means that a show whose debut was supposed to crown the rollout of Aria will only be in previews as of Dec. 16. Given how incredibly underwhelming its casino is, Aria is going to need every bit of razzmatazz it can muster for opening night.
A decade’s worth of job security may be taking some of the edge off Monte Carlo headliner Frank Caliendo‘s act. Or so it appears. Unfortunately, in writing my review, I somehow forgot to mention the funniest single part of Caliendo’s show. Noting that Casey Kasem was the voice of Robin in old Batman cartoons, he interprets the Boy Wonder in the style of American Top 40. Maybe you had to be there (i.e., the Seventies) but I was laughing so hard I could scarcely breathe.
Here in Illinois, video gambling in bars continues to bomb in the suburbs. From what I heard at G2E, its best prospects for acceptance lie in the rural areas, not the urbanized ones. Companies like IGT and WMS Industries have to be hoping that what doesn’t play in Schaumburg proves more appealing outstate. As far as riverboats, the Chicago-area ones are being bled dry by northern Indiana. Hopes that the bankruptcy of Don Barden‘s two Majestic Star vessels will reverse that trend look like wishful thinking. After all, neither Ameristar Casinos nor Harrah’s Entertainment is quitting the Hoosier State anytime soon.
Gambling’s growing pains are also being felt in Ohio. Two bills before the Lege show how far the Buckeye State is from having a regulatory apparatus to cope with the casino industry which has suddenly been thrust upon it. One, requiring background checks on casino employees, seems like mere common sense. Another, which would place draconian restrictions on industry campaign contributions, would confer second-class citizenship upon casino companies and their employees. This is akin to the nonsense which, until recently, forbade casino employees from running for office in Atlantic City.
Restraint in Kansas: Even with only one casino in progress, the Kansas Lottery Board made it clear this week that any old proposal isn’t going to cut it. Given how far short of acceptability Ozark Trail Gaming‘s bid fell, the latter clearly overestimated the state’s desperation for casino revenues. Also, when your Hail Mary pass is a tentative management deal with Penn National Gaming, your own desperation is writ large. Penn has been so whimsical of late — especially in Kansas — that the state has copious reasons for being skeptical.
With all the new rooms coming onstream I guess it was a good idea that they imploded the Stardust and New Frontier when they did or rooms would be free.
Cal
The reason some communities don’t want video poker machines is because they already have illegal video poker machines in some taverns in and around Chicago and by making them legal in Illinois there would be way to many video poker machines around Chicago and the suburbs. By the way who would regulate these machines? Former governor Blagojevich?
I have to been to some taverns around Chicago and the suburbs that have had video poker machines in them for years and years. Some of the taverns include The Old Munich Inn in Wheeling and then there’s three taverns that I know of in Chicago that have video poker machines: O’Lanagans, Marge’s and St. Pauli’s.
As far as I know some of the rural areas already have illegal video poker machines inside some taverns. I graduated from Illinois State University in 1989 and when I was in college occasionally me and my friends used to go out to some country bars outside the Bloomington-Normal area and most of these taverns had illegal video poker machines. It would be safe to assume most of these machines are still there.
From the pictures I have seen of the inside (from various websites) City Center looks pretty cool. It should be considering it only costs $8.5 billion dollars to build.
That being said when you said here “Given how incredibly underwhelming its casino is, Aria is going to need every bit of razzmatazz it can muster for opening” this kind of worries me. Hopefully City Center will increase interest and visitation to Las Vegas in 2010.
“The men who run these companies aren’t idiots who couldn’t read the warning signs. Judging from their own after-the-fact rationalizations, they simply chose to ignore them, borne on a wave of optimism that proved reckless … or worse, judging by the economic havoc that can be found just a block or two beyond the Las Vegas Strip.”
Well said. Isn’t it ironic how these people engaged in “reckless” economic gambling while at the same time discouraging it in their patrons? I must have seen Gary Loveman’s big head every thirty minutes during the WSOP encouraging me to “gamble responsibly.” (Of course, behind the scenes they really don’t want you to gamble responsibly at all, c.f. the Watanabe case). I honestly don’t know how some of these execs can live with themselves. (Oh wait, an $8 million salary/bonus might go some way towards rationalizing that.)
Also, I’m skeptical how much off that projected room inventory will actually come online. CityCenter is done, obviuosly, but I think the people “pulling the strings” might hold off on some of the places like Fontainebleau, etc.