Is Sheldon Adelson the secret string-puller behind Kelden Engel‘s petition drive to have part of the Riviera preserved? John L. Smith hints at that in this morning’s edition of Adelson’s Las Vegas Review-Journal. “If he’s carrying the water for someone 
who might benefit from delaying the convention center expansion, well, let’s just say that will eventually come out,” writes Smith. And who might want to screw things up for the Las Vegas Convention & Visitors Authority, which has been a thorn in his side for years? Preserving one Riviera tower (To what end? And who’s paying for it?) would run a cart and horses through the grandiose expansion plans the LVCVA has drawn up for the site. Also, any delay in demolition potentially screws up the LVCVA’s intention to use the Riviera’s Strip front for surplus display space during shows like the Conexpo-Con/Agg convention. Adelson would shed no tears over that scenario.
And, by picking a freshman at Nevada State College to do his bidding, Adelson would theoretically have seemed to have woven an impenetrable veil. However, as crafty as Adelson has proven to be time and again, Smith has a way of seeing through his schemes, and we definitely think he’s pinned the tail on the donkey this time. Reluctantly, we have to agree that the Riv is now “a jumble of architectural themes and afterthoughts. Frankly, I suspect it wasn’t imploded years ago because no one wanted to waste the dynamite.” Touche!
* MGM Resort International‘s REIT, MGM Growth Partners is planning on some retail therapy and — to that end — is pricing its IPO at $21/share, looking to raise just over $1 billion. According to an SEC filing, the REIT “will … actively seek to identify additional entertainment and gaming-related properties for potential acquisition from non-MGM entities. We intend to selectively grow our portfolio of gaming properties through the acquisition of assets that contribute to our tenant and geographic diversification, can be leased subject to long-term leases with tenants with established operating histories, have low operating risks and provide stable cash flows, consistent with our Properties.”
It’s too early to speculate on what or where Growth Partners might be targeting for acquisition. If it were to buy out joint-venture partners like Hyatt Gaming (Grand Victoria in Illinois) or Boyd Gaming (Borgata), it would run through that initial billion pretty fast. It might be more fruitful to look at markets, such as Pennsylvania, where MGM isn’t. To put the IPO’s price in perspective, MGM stock is trading at $22.82 as I write this. MGM is hanging onto high cash-flow properties The Mirage and Bellagio, as well as Circus Circus. The incongruity of Circus’ inclusion is explained by two things: low property taxes and (which Bellagio and The Mirage also enjoy) and 91 acres of real estate, much of it underdeveloped. If MGM decides to build at the north end of the Strip — not a likely near-term proposition — it would only be out the $30 million it spent on its al fresco festival plaza … pocket change.
Pissy minority investor Jonathan Litt, impervious to such subtleties, issued a statement damning Growth Partners with faint praise. Litt sniffed that it was a “half-step to unlock the value of MGM, which is better than no step at all … in our view, full value can be unlocked by including all the properties in the REIT and eliminating any overlap on the board or management team of MGM Resorts,” wrote Litt, no doubt motivated by pique that MGM didn’t take his REIT proposal and run with it.
* Additional details continue to emerge regarding Wynn Paradise Park. The admission fee has been narrowed to between $25 and $30, and would be waived for hotel guests. Demonstrating his continuing ability to think big — and not just in terms of square footage — Steve Wynn described his vision in these terms, “Las Vegas has everything except beaches. It doesn’t have an ocean … So we decided to do it.” And, as casino boffin David G. Schwartz sagely observed, “Anytime Steve Wynn is going to put two bricks together in Vegas … it’s huge news.” By rote, journalists are required to reiterate that Paradise Park is subject to approval by the Wynn Resorts board of directors. But, really, who are we kidding? Not only has the board consistently backed Steve Wynn’s wishes, it would be crazy to reject almost any new Steve Wynn concept short of building a casino in outer space.
It is premature, however, for the Las Vegas Sun to pronounce gambling revenue as having been “eclipsed” by restaurants and nightclubs. Take the casinos out of Las Vegas and what do you have? Phoenix without major-league sports, that’s what. Wynn isn’t including “a small casino” in Paradise Park just for the heck of it.
