New life for downtown Vegas?

Sep 13, 2005 12:37 AM

Fremont Street is getting ready to rock-n-roll. There’s continued talk of a renaissance in the area where Las Vegas and its No. 1 industry began.

It’s not just Mayor Oscar Goodman doing the cheerleading.

Developers are looking for affordable opportunities with big potential as soaring real estate prices along the Las Vegas Strip force all but the biggest companies to have second thoughts about building.

"Some of that downtown property’s going for five million an acre now," said an impressed casino industry observer. He didn’t want his name used, partly because he continues to have an interest in his own deal along the Fremont corridor.

Landry’s Chairman Tilman Fertitta could provide the catalyst for other deals. He’s preparing to wrap up his company’s purchase of the Golden Nugget by the end of September. He’ll then push things a big step further with an expansion. Reliable sources say he is interested in buying other property to expand the Nugget’s footprint.

One possible consequence of such development talk is an eventual end to the Fremont Street Experience, or at least a temporary dismantling. The light and sound show was developed in the early 1990s but would probably be in the way of whatever new develops.

Reliable sources with their ears to the ground stand behind previous reports that MTR would like to rid itself of the Binion’s Gambling Hall. The West Virginia-based gaming operator has apparently decided that it bit off more than it cares to digest by buying the late Benny Binion’s historic gambling hall.

Boyd Gaming is said to have taken a close look at this property, but whether that interest will produce a deal is unclear. Station Casinos has also taken a hard look at the possibilities.

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The big thinkers at Harrah’s Entertainment appear intent on using the company’s dazzling geographic diversity to their advantage as they reassess priorities and undertake a recovery plan from hurricane Katrina.

The strategists with other Las Vegas companies that own Gulf Coast casinos — Boyd, Pinnacle, MGM Mirage — probably have similar thoughts.

But with the exception of MGM Mirage, which has an upcoming event this week that promises to get a lot of attention, no other company has so many options.

What I’m hearing is that Harrah’s may be inclined to hurry up the announcement of plans for capital spending in Las Vegas and perhaps Atlantic City. Until Katrina, there was no reason to give these subjects anything less than all the study time they needed.

It’s no secret that Harrah’s has big things in mind for its bulging Las Vegas real estate portfolio. The company has spent more than $300 million on property near the Strip since acquiring Caesars and the likelihood is that we haven’t seen the last of the deal-making.

Shifting the spotlight to plans for Las Vegas where a "signature Harrah’s" and the use of the Horseshoe name will be part of the mix will balance out the dismal news from the Gulf Coast.

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MGM Mirage strategists are working on their variation of the same theme. But Kirk Kerkorian’s company has it a bit easier, what with only one Gulf Coast resort and plans already in place for a coming out party this week intended to put the spotlight on CityCenter, MGM’s largest ever development.

A press conference to raise the curtain on some of the elements associated with this $10 billion development on the Las Vegas Strip has been tentatively scheduled for Thursday at Bellagio.

Action by Harrah’s and continued efforts by MGM to keep CityCenter’s profile at a high level will benefit both companies, showing they can deal with a disaster and plan for future expansion on two fronts.

Redevelopment plans for Harrah’s have been under careful study for a number of months, while the company has been accumulating massive amounts of real estate around the corner of Flamingo and the Strip.

One possibility has the Bally’s property being redeveloped into what a source terms a "signature Harrah’s," and the property that includes the Flamingo becoming the company’s first Horseshoe brand in Las Vegas.

Announcing something big in Las Vegas will serve the purpose of giving company watchers something to consider besides the continually unfolding tragedy on the Gulf Coast.

Continued servings of warmed-over disaster news are not what a public company needs as its leaders project the sense that the best is still to come.