happy birthday, mirage!

Happy birthday to my favorite place on the Strip! From the Las Vegas Review Journal:

MIRAGE MIRACLE: The Mirage turns 20 today
Steve Wynn's tropical-themed resort-casino had its critics but kicked off building frenzy
By HOWARD STUTZ

Twenty years ago, The Mirage was the CityCenter of its time...But with the city still recovering from the economic doldrums of the early 1980s, many financial experts didn't think The Mirage would succeed.

Some wondered if The Mirage would really grow the market. Most expected it would just steal customers from neighboring hotel-casinos.

Sound familiar? Read more.

I know the building boom ushered in my the Mirage has its fair share of critics—too big, too garish, too corporate. But there's no denying the Strip recovered as a result of the larger-than-life mega resorts and helped rebuild the market. Thankfully, the idea of Vegas being a family-friendly vacation spot is no longer the brand identity.

Here's a very telling quote about how Steve Wynn built a game changer:

"The '80s were not an easy decade for Las Vegas. Casinos started going after a family friendly market; and Circus Circus (Enterprises) was the most profitable casino company on the Strip, because more people were betting $100 a trip rather than $100,000."
—David G. Schwartz, director of the Center for Gaming Research at the University of Nevada, Las Vegas

leaving on a jet plane...wondering when you're coming back to vegas!

Not terribly shocking, really. From the Review-Journal:

McCarran passenger counts fall 1.3 percent in October
By HOWARD STUTZ

Passenger counts at McCarran International Airport fell 1.3 percent in October. More than 3.51 million passengers came through McCarran during the month, compared with more than 3.56 million passengers in the same month a year ago.

For the first 10 months of 2009, McCarran has seen passenger counts fall 9.4 percent over the period in 2008.

No real surprise that passenger counts are down this year. The real meat-and-potatoes comparison will be 2k10 numbers vs. 2k9 and even 2k8. That'll give the clearest indication if the economy is rebounding. We already know Strip development is going to remain halted. That's old news. Let's see if people are ready to occupy the rooms already waiting for them.

fourth-quarter las vegas: the good, the bad & the ugly.

Quite a bit going on in the Valley this week. Local media's buzzing with the upcoming opening of MGM Mirage's CityCenter, Some telling quotes from a roundtable discussion at the Global Gaming Expo, and oh yeah, Station Casinos continue to lose money hand over fist.

You can read all about each issue at LVRJ.com, but here are the brass tacks:
Least Surprising Story of the Week
MGM Mirage and Dubai World received its gaming license for Aria, the one-and-only casino at the $8.5 billion, 67-acre CityCenter. Shocking, right? The joint will be open for business next month. Read more.

Boyd's Balls—Crystal or Otherwise—Still Ain't That Great
"If you look out over the next 10 years, you could probably count on one hand the number of new buildings we'll see on the Strip. Frankly, my crystal ball isn't that clear, but there will not be the tremendous amount of new buildings on the Strip." —Keith Smith, CEO, Boyd Gaming
Translation: "Anybody wanna buy a half-built casino?" I'm not trying to be a smart ass, but it's clear Boyd doesn't plan on finishing Echelon. They'll sooner buy a Strip property than complete what was to be the company's crown jewel. You know what that means? Expect to look at dormant Echelon and Fontainebleau sites for years! Read more.

Why, yes, Virginia, casinos also can lose money!
At first glance, it would seem implausible that casinos would lose money. But it's a competitive business, just like restaurants and bars and such. Some profit. Some don't. Station Casinos—catering largely to a local market—had to file bankruptcy. And who might be there to bail them out? Boyd Gaming. Guess we now know Bill Boyd tore open that mattress full of Echelon money and has new ideas for it, no? Read more.

Which is good? Which is bad? Which is ugly? You decide.

we want floyd! we want floyd!

My first Fight Night in Vegas.

COTTO CONQUERED: Pacquiao in seventh heaven
12th-round TKO gives Filipino seven belts in seven classes
By STEVE CARP
LAS VEGAS REVIEW-JOURNAL
The chants began as soon as Manny Pacquiao was declared the new WBO welterweight champion Saturday night.

"We want Floyd! We want Floyd!" many in the sellout crowd of 16,200 at the MGM Grand Garden demanded. Read more.

Here's the money quote on Manny Pacquiao: "...the first boxer to win seven world titles in seven weight classes."

Wow! Bring on Money Mayweather!

citycenter: game changer or sinking ship?

I don't know of too many casinos that can make up a $4 billion shortfall overnight. From the Las Vegas Review Journal:

THE STRIP: CityCenter valued below cost
MGM Mirage: Half-stake in project worth $2.44 billion

By HOWARD STUTZ
CityCenter is worth about half of what it cost MGM Mirage and Dubai World to build the massive Strip development, according to third-party valuation specialists.

In a statement to investors Tuesday, in which MGM Mirage said it was writing down more than $1 billion related to CityCenter, the company estimated the value of its 50 percent ownership in CityCenter at approximately $2.44 billion. The project's total construction budget is $8.5 billion.

"This decision and related market conditions led to the conclusion that the carrying value of the residential inventory is not recoverable," MGM Mirage said in a statement.

MGM Mirage said CityCenter was required to have unnamed third parties review its residential inventory for impairment because of the company's decision to reduce the cost of project's 2,400 residential condominiums by 30 percent.

Also, MGM Mirage's largest shareholder, billionaire Kirk Kerkorian, hinted he might divest himself from the company. Read more.

MGM Mirage
CityCenter

citycenter in jeopardy?

Is the Las Vegas Review Journal guilty of hyperbole, or are they predicting the death of CityCenter? Decide for yourself:

CityCenter future in doubt after Dubai partner sues MGM Mirage
By HOWARD STUTZ

The survival of the $9.1 billion CityCenter development was called into question Monday when the investment arm of the Persian Gulf state of Dubai sued MGM Mirage over concerns about the project’s viability.

According to the lawsuit filed in Delaware Chancery Court, Dubai World, a 50-50 joint venture partner in CityCenter, is asking for unspecified damages and wants to be relieved of its obligations under the companies’ agreement that was struck in August 2007.

Dubai World, which is financing its portion of CityCenter through its Infinity World subsidiary, contends that recent statements by MGM Mirage constitute a breach of the joint-venture pact and has put the project at risk. A spokesman for MGM Mirage was unavailable for comment this morning. As of noon PDT, MGM Mirage had not issued a statement about the legal action.

The lawsuit seemingly took MGM Mirage by surprise. Last week, during the company’s fourth-quarter earnings conference call, MGM Mirage Chairman and CEO Jim Murren was asked about the relationship with Dubai World. “Our relationship with Dubai World is outstanding and has been since August of ’07 when we consummated the joint venture,” Murren said. “They have been steadfast partners.” Read more.

mgm mirage break-up...start the clock.

Looks like MGM Mirage's day just got worse. From the Las Vegas Review Journal:

Dubai partner sues MGM Mirage over CityCenter

DUBAI, United Arab Emirates — The Dubai state-run developer involved in the $8.6 billion CityCenter complex on the Las Vegas Strip says it is suing partner MGM Mirage amid concerns about the project's viability.

Dubai World says subsidiary Infinity World filed the lawsuit in Delaware Chancery Court "to protect its rights and the best interests of the CityCenter project."

Newsvine Digg Fark Technorati reddit StumbleUpon del.icio.us Slashdot Propeller Mixx Furl Twitter MySpace Facebook Google Bookmarks Yahoo! Bookmarks Windows Live Favorites


MGM Mirage is struggling under more than $13 billion in debt as it pushes ahead on CityCenter, its largest casino yet.

Infinity says recent statements by MGM Mirage about its future viability constitute a breach of contract and put the CityCenter project at risk.

It says it's asking the court to relieve it of its obligations under the joint venture agreement.

The irony of a casino plowing forward with a semi-risky venture while accruing a mountain of debt is not lost on me. When they started this project, it looked like a license to print money. The economy was soaring. Vegas tourism was at an all-time high and the affluent, young crowd was streaming onto the Strip in droves.

All the major Strip operations could afford to charge high prices for rooms, dinner, entertainment, etc. They were trying to push all the penny slot players and nickel blackjack players downtown with all the other riff-raff.

But now, MGM stock is barely worth the paper it's printed on.

I'm not celebrating MGM's recent misfortune. It disappoints me to no end. But it's worth noting all the corporate monsters of the Strip have only themselves to blame. Goliath smote Goliath.

Start the clock on the breakup of MGM Mirage.

cinevegas turns 10.

Doug Elfman of the Las Vegas Review Journal puts a pretty good wrap on CineVegas:

Unlike some others, celebs at CineVegas talented, classy

DOUG ELFMAN

Japanese artist and filmmaker Takashi Murakami points to one of his animated characters after arriving at a screening of "Planting of the Seeds" at the Wynn Hotel and Casino during the CineVegas Film Festival in Las Vegas on Monday, June 16, 2008.
AP Photo/Laura Rauch

For 10 days, actors strolled red carpets and private parties at CineVegas. When prompted, they told stories of their younger days as messy tourists in Las Vegas. But their admissions were hardly ripped from the pages of Pamela Anderson's diaries.

Sam Rockwell, star of 2002's "Confessions of a Dangerous Mind," confessed: "The last time I was in Vegas, I woke up in a lawn chair." But he didn't elaborate.

Gabriel Mann, a player in the "Bourne" thrillers, said his last visit here was 10 years ago, when "I lost all my money -- my money and my mind." Yet he declined repeated requests to explain this rap.

So even though CineVegas was a little crazier than usual -- with one Britney Spears sighting, an official party held at a strip club, and gobs of star-gazing parties stocked with free booze -- its stars were reserved actors showing art house fare to film lovers at the Palms. Read more.

$4 gas prices forcing gamblers to stay close to home?

Howard Stutz at the Las Vegas Review Journal has my job! He writes a weekly column about the gaming industry.

Here's a little bit of today's Inside Gaming column:

No surprise, but gasoline prices of more than $4 a gallon don't bode well for regional casino markets. Deutsche Bank gaming analyst Andrew Zarnett said Atlantic City would suffer as gamblers stay close to home.

"Consumers will choose the convenience of Pennsylvania casinos over Atlantic City amenities," he said.

Potential casino patrons are spending more for necessities, such as gasoline and food, leaving fewer dollars for discretionary activities, including gambling.

Zarnett said casinos in Indiana, Iowa, Louisiana and Missouri are experiencing declines in visitation. Here's a little bit of today's Read more.

I made the rounds in Vegas this past May and all the talk among the employees in the pits was how its business was...well, in the pits.

Whether or not we're in a recession is a debate best left to the wonks on Meet The Press, but when people are paying $4 for a gallon of gas? Something's got to give.

revenues still down in vegas.

No real surprise here...from the Las Vegas Review Journal:

Gaming revenues decline again

Gaming revenues in April decreased 5 percent compared with the same month a year ago, the fourth straight month in 2008 casinos took in less than they did in 2007. Gaming revenues were $1 billion, compared with $1.053 billion a year ago.

On the Strip, gaming revenues were $524.1 million in April, a 1.28 percent decrease compared with $530.9 in April 2007.

Gaming taxes collected by the state based on April's gaming revenues were off 3.5 percent from a year ago, the seventh month out the last 11 that gaming tax collections have shown a decrease.

A few years ago, when I was a dealer, we at the casino used to comment how casinos were recession-proof. That's not the case any longer. Although I would guess the riverboats and Indian casinos across the nation are hurting worse than Vegas as a whole. Just a guess, though.

Just a year ago the Strip was gearing up to skew high-end with lavish resorts catering to affluent people. That's not going to change, but the gaming side of things will have to skew toward "average" players until we come out of this poor economy.

Again, duhhhhh!

it wouldn't be the first time mediocre talent sold out in vegas.

That's so crazy it might work! Mike Weatherford of the Las Vegas Review Journal has an idea that's begging to be picked up.

'Idol' should have home on Strip

With the "American Idols Live" tour headed for the Thomas & Mack Center on July 5, it once again begs the question, "Where's the permanent, sit-down version of 'American Idol' on the Strip?"

"It's crazy that it hasn't happened. Can you imagine? It would sell out twice a night," says Andy Walmsley. He is both the "Idol" set designer and a Vegas producer himself, albeit on a modest level, with "Laugh Out Loud with The Scintas" at the Las Vegas Hilton.

I've long accused casino entertainment types of being imitators, not innovators. But there is a disconnect between the big entertainment ideas -- some obvious, some less so -- and the current reality of casinos serving as innkeepers, collecting rent from the more humble likes of magicians and comedians. Read more.

dubai-dubai-doooooo.

Las Vegas is proving itself to be a model for international gaming ventures. First Macau, now Dubai. From the Las Vegas Review Journal:

Dubai firm sets sights on LV hospitality: Investors aim to grow Light Group's brand

By BENJAMIN SPILLMAN

It's been less than two decades since business leaders in Dubai sought to transform the desert emirate into a leading global tourism destination.

Now an investment firm that grew from the roots of Dubai's transformation wants to reinvent hospitality in Las Vegas, long one of the world's top tourist spots.

"We should be able to do it better," said Mohammed Ali Al Hashimi, head of Zabeel Investments, a financial firm that recently bought a 50 percent stake in the Las Vegas-based Light Group.

Zabeel is a private company with a stake in everything from real estate to aeronautics and a property portfolio with an estimated $5 billion value, according to news reports. Read more.

Dubai is one of those places in the world I'd love to see some day. It's such a rich nation, I bet even the homeless people wear Armani.

vegas on a shoestring.

Thanks to a flabby US economy, the Strip casinos have to scale back their collective plans to cater strictly to the affluent, upscale travelers. From Sunday's Las Vegas Review Journal:

RELAXING DEALS, FUN DEALS, FOOD AND DRINK DEALS: Vegas on the Cheap
Sour economy could be sweet deal for savvy shoppers

By SONYA PADGETT

If there's anything positive about Las Vegas' struggling economy -- and that's a big if -- it's the return of the good casino deal.

While we're nowhere near the $3.99 all-you-can-eat buffets of yore -- yet -- there are some decent deals to be found, even for those whose budgets are tighter than a Rio cocktail waitress's uniform. Read more.

I observed the struggling economy in action when I was in Vegas last month. I had a chat with a pit boss table games manager at The Mirage who told me, "we're starting to pick back up right now."

She's a veteran of the Strip for many years, I gathered. I was somewhat surprised that the Mirage was feeling the pinch, since it's one of the more lavish destinations.

But that's the problem. When the economy is doing better, middle America has more disposable cash to throw around. And where better to throw money than the desert? But when gas is running twice as much as it was from four years ago...well, you get the point.

The economy will pick back up. And when it does, bye-bye deals.