The last few days have made painfully clear that even a fantasy land like the Las Vegas Strip exists in the real world. And the troubles with the real estate market and credit crunch seem to be imperilling a significant amount of the next wave of Las Vegas development.
Three major Strip projects seem to be suffering various degrees of crisis. Cosmopolitan is still being built next to MGM-Mirage’s City Center. But the project is in major trouble, as a lender has begun foreclosure proceedings.
Meanwhile, Business Press is reporting that the super-sized version of New York’s Plaza, planned for where New Frontier once stood, may be delayed because of the credit crunch. That project was to have cost $6 billion.
Finally, today comes news from the Sydney Morning Herald
that the land on the Strip that Australian billionaire James Packer had once proposed to build the world’s tallest building on as part of a $5-billion Towers resort is up for sale. Packer’s company Crown, according to the Sydney Morning Herald, remains connected to another major Strip project, “funding the Fontainebleau Hotel Casino in Vegas with U.S. group Turnberry.”
And as Fontainebleau’s continued construction hints, “slowing down” in Vegas still has development going at a rapid pace. Dubai’s partnership with MGM-Mirage on City Center assures the completion of the biggest project in town. MGM has already opened its Signature property. Also, the Venetian’s Palazzo expansion recently opened. And George Maloof is in the process of opening his Palms Place tower. Wynn’s Encore expansion is set to open soon, and Echelon Place is being built at the location of the imploded Stardust.
So, even conservative estimates have about 20,000 new rooms set to open by 2010. Locals are counting on those rooms to generate the jobs to keep the local economy humming and especially to salvage the devastated residential real estate market.
In any other city people might worry: Will more tourists arrive in Vegas to fill all those new rooms and pay for all those new jobs and justify all this construction?
While Las Vegas may have some short-term economic issues, locals long ago stopped sweating that big issue. It seems no matter how many hotel rooms get built on the Strip, more tourists come to play here.
Maybe this is evidence that if you think you’ve got it bad…!