Havent seen any talk about this development, with the biggest part set to open just a month away. What's your thoughts on this, New best hotel or a bust? Seems like the approx 7000 new hotel rooms could put a huge damper on the rest of the hotels, including its sister hotel the MGM grand. Seems like the 200+ condos are still selling in this down market, for a whoping 1.7mil each
The 12000 new jobs it will be offering sure seem like it will help there local economy.
around 17 million square feet makes it the biggest property on the strip.
Claims to be the largest privately financed development in the United States. I just dont see it as being anything super special. Whats your thoughts?
Might be time to buy MGM stock!
-Scott
Also shows much developing can actually cost alot more then you plan, orignally set at a 4 billion dollar project ending up costing around 11 billion, and thats with losing 25 storys on one of the hotels!
-Scott
FYI – City Center condos have had significant price reductions. That includes condos that were already under contract. The City Center project had been touted as the savior of Las Vegas for a couple of years until recently. Now the fear is that the project is just going to siphon tourists away from existing properties. The thing is that MGM owns a large portion of the strip hotels so they are, in effect, competing with themselves.
Another note: The media likes to make it sound like Vegas tourism has slowed to a trickle. Nothing could be further from the truth. It is down about 10% based on passenger count at McCarran airport. Instead of 36 million people coming in (3 million a month) it is down to about 32-33 million. That’s still a huge number and the strip is still packed with tourists every weekend. The problem is that the strip properties have over-leveraged themselves to such a degree that they are losing money. They need to operate a maximum capacity and had raised prices to such a degree before the recession just to make a profit. Now they’ve been forced to lower prices and that is killing their bottom line. It wasn’t that long ago that Vegas was one of the best travel bargains around. That started to change when the mega-resorts started popping up.
:cool:
In anything, I think its time to short MGM. This development is wrapped up in legal trouble, quality issues, and lawsuits from their Middle Eastern investors who have their own money troubles.
MGM owns much more than the MGM grand. They own the entire west side of the strip from Luxor to Treasure Island. except Caesar's. That's Luxor, New York New York, Monte Carlo, Bellagio, Mirage, and Treasure Island, plus their namesake MGM Grand. They may own Mandalay Bay, too, I can't recall. I can't see these new rooms helping room rates. I'm not a high roller and don't get free rooms on the strip, but I've had e-mails in the last few days from numerous Vegas hotels with $30-40 weekday room rates.
http://www.thestar.com/business/article/719540--rebuilding-las-vegas
Timing the RE or economic cycles on a project this big is impossible.
FYI – City Center condos have had significant price reductions. That includes condos that were already under contract. The City Center project had been touted as the savior of Las Vegas for a couple of years until recently. Now the fear is that the project is just going to siphon tourists away from existing properties. The thing is that MGM owns a large portion of the strip hotels so they are, in effect, competing with themselves.
Another note: The media likes to make it sound like Vegas tourism has slowed to a trickle. Nothing could be further from the truth. It is down about 10% based on passenger count at McCarran airport. Instead of 36 million people coming in (3 million a month) it is down to about 32-33 million. That’s still a huge number and the strip is still packed with tourists every weekend. The problem is that the strip properties have over-leveraged themselves to such a degree that they are losing money. They need to operate a maximum capacity and had raised prices to such a degree before the recession just to make a profit. Now they’ve been forced to lower prices and that is killing their bottom line. It wasn’t that long ago that Vegas was one of the best travel bargains around. That started to change when the mega-resorts started popping up.
:cool:
and now, once again, it is a value travel spot! Rooms are often free if you get a players card and even if you are paying, the discounted room rates are a steal!
Vegas is not far off from recovery in my opinion. Granted, the hotels are hurting due to the overleveraging, but that too will be corrected through the commercial meltdowns.
Since this is such a hot spot and attraction to all, we BP Nation and company) will be working on setting up a BP event here, hopefully early next year!
"I would be up for a get together there if we can plan it out a little. Yours just came up too quick, Jon."
Sorry, I just piggy backed it onto an IT conference next week.
City Center should be open next month, so maybe that's the place to do the next one so we can see the latest and greatest development.