Inside Asian Gaming

INSIDE ASIAN GAMING | June 2013 26 rates were prohibitive. Interest rates have since come way down, as have equity requirements, making it possible for the big operators to refinance their considerable debt loads on easier terms, which is freeing up funds to renovate and remodel and invest in expansive new non-gaming attractions, about $1 billion of which is on tap in the next few years, indoors and out, on the Strip, off the Strip and Downtown. The LVCVA has master-planned a $2.5 billion “Global Business District” at the Las Vegas Convention Center that will unfold in phases with additional exhibition and meeting space, new food and beverage outlets, a new grand concourse, an international business destination called the “World Trade Center” and a transportation hub connected to the resort core in and around Las Vegas Boulevard. “I’m not sure how much better things can get in terms of a cost of capital that’s rational,” said Bill Lerner of equity research firm Union Gaming Advisors in a recent interview in the Review-Journal . “Markets are trying to price in the good news, and they’re certainly demonstrating that the best is yet to come.” Genting likes its chances. It has, as it claims, “one of the last major developable sites on the Las Vegas Strip”. The company hasn’t assigned a price tag to Resorts World LV, but reports are of a phased project starting at $2 billion, climbing possibly to $7 billion, no doubt with partners. Plans call for acres of water attractions and amusements around a “cluster of hotels” along with a 4,000-seat theater, more than 400,000 square feet of restaurant and retail space, 500,000 square feet of MICE, a panda habitat, a replica of the Great Wall of China and a collection of terra cotta warriors modeled after the legions of little men unearthed from the tomb of China’s first emperor in a famous archeological find from the last century. Echelon, which might have been as grand, will fade quickly from the collective consciousness in this town of notoriously short memories, and no doubt, Boyd and its shareholders are glad to get out from under it. But the price was steep. Two operating casinos for openers. One, the legendary Stardust, was blown up to clear the site. The other, Bill’s Gamblin’ Hall & Saloon, named for Chairman Bill Boyd and located on prime real estate at Flamingo Road and the Strip, the site of the old Barbary Coast, was traded to Caesars in exchange for land Boyd wanted to add to the Echelon complex. (Caesars is rebranding Bill’s as an upscale boutique hotel in partnership with Gansevoort Hotel Group.) That’s not the end of it. Talk about how not to make money in Sin City, Boyd is also out about $500 million in construction and other costs related to the failed development, and $187 million of the $350 million from the sale of the land goes to reimburse a utility consortium for a power plant it was going to build there. The total loss taken as a charge against last quarter’s earnings: $994 million. IN FOCUS Echelon will fade quickly from the collective consciousness in this town of notoriously short memories. Conceptual design of the LVCVA’s master-planned “Global Business District”