Commercial Real Estate

$4.8 Billion Las Vegas Project Halted

156 Articles Written

Another one bites the dust…

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A major Las Vegas construction project was halted last week.  Echelon PlaceThe $4.8 billion Echelon Place development on the Las Vegas strip had been hailed as a sign that the city will survive the current economic woes.  Construction on the 87 acre project began in June 2007.  The developer, Boyd Gaming Inc., expects the construction to be halted for up to a year. 

The Project

The project includes four hotels totalling almost 5,000 rooms.  The plans also call for a 300,000 square foor shopping venue, 750,000 square foot convention center, 140,000 square foot casino, 4,000 seat theater and approximately 30 restaurants and bars.  It was a major piece in the development of the north strip area.

The shutdown has approximately 800 construction workers heading to the unemployment lines  Economic forecasts for Las Vegas had been pointing at 2009  as the year of recovery.  Echelon Place was prepared to hire 10,000 workers when it opened.  This would have provided a major spark to the local economy and helped to revive a stagnant housing market.

 While this is a major project, it is not the largest in the area.  The City Center project is slated to cost a staggering $9.2 billion and provide an even greater number of jobs in the area.  The developer of City Center, MGM Mirage and Dubai World, have had their share of problems but have, so far, managed to keep their project on track.

Credit Markets to Blame  

Boyd Gaming CEO, Keith Smith, had this to say: “It was a decision based on the economic climate for capital.  A lot has changed in the past year.  The financing is just not there.”  It certainly can’t be an easy decision to mothball a project of this size and scope.

While they claim to be halting the project for a year, it remains to be seen if and when it actually starts again.  There have been many projects in Las Vegas that never get off the ground for various reasons, but this one is halfway done. 

Las Vegas is a city that prides itself on fantasy and illusions.  As you travel the strip you can see the New York city skyline, pyramids of Egypt, a volcano, and the Eiffel Tower.  We now have a monument to the real estate bubble as a $4.8 billion construction project gathers dust.  

Man, I really like Vegas.Elvis Presley


    Replied over 11 years ago
    Another reason I believe Las Vegas is still in for trouble is because of the rising cost of air fare. I used to goto Vegas once a year because it was soo cheap to fly there, but that isn’t true anymore. It will just hurt the strip even more.
    Replied over 11 years ago
    Las Vegas is in trouble because people don’t have that much money to spend anymore…
    Replied over 11 years ago
    One more problem of Las Vegas will be the problem with the money, because the US spent so much money in war, that they couldn’t have enough money for such big projects. And by the way everything is getting more expensive, so this will also cause troubles I think.
    Tony Sena
    Replied over 11 years ago
    You guys are forgeting that Las Vegas is one of the top destinations for conventions which has been a growing segment every year. Gaming is no longer the main source of revenue in Las Vegas. Las Vegas is going through a small recession right now but so is the rest of the country. Does that mean every other city is in trouble?
    log home builders
    Replied over 11 years ago
    That is no surprise that a huge million dollar hotel has been halted with not as many people are traveling and vacationing. It looks like a good hotel with cool architecture.
    Replied over 11 years ago
    They gambled…they lost…
    Jeffrey Allen
    Replied about 9 years ago
    As of 3/11, the 1st high-rise hotel-casino on the Vegas Strip has announced it will close + lender forecloses on the $1B Hard Rock Hotel-Casino.