The Las Vegas Strip kicked off the year by hosting CES, the big tech conference long-known as the Consumer Electronics Show, which was expected to be somewhat close to normal after being virtual the year before. But it ended up as a shell of itself due to the Omicron variant of covid. Instead of Sin City's grand return, the event saw mostly empty hotels as major companies pulled out.
After January, however, Las Vegas began to get back on track. March Madness drew near-record crowds and headliners began returning to Caesars Entertainment (CZR) and MGM Resorts International's (MGM) big venues. It wasn't like flipping a switch, it was gradual with regular tourists returning first, followed by business travelers, international travelers (after bans were dropped and testing requirements went away), and, finally, older customers have also made their way back.
Las Vegas hosted a massively successful NFL Draft in April that essentially showed the world that Sin City was back in all its glory.
And, even during the city's darkest days, investment in the Las Vegas Strip has been steady. Land prices climbed astronomically, and a seemingly endless number of new projects have begun (with a few nearing completion). There was a lot of news coming from the iconic 4.2-mile stretch of Las Vegas Boulevard this year and these are some of the highlights.
Image source: MGM Resorts International.
Hard Rock Buys Mirage From MGM
Technically, this deal was announced in late December, but the real news wasn't Mirage getting a new owner, it's that huge changes are going to happen at the property. Hard Rock International, which owns the Hard Rock Hotel & Casino in the Fort Lauderdale area, plans to build its signature Guitar Hotel on the property.
That hotel will be built at least partially on the site of the current Mirage Volcano, bringing about the end of that beloved free show. In addition, Mirage has also closed the Siegfried and Roy's Secret Garden and Dolphin Habitat--a longstanding, well-loved attraction at Mirage.
It's also not known whether "Beatles Love," a Cirque du Soleil production will continue at Mirage under the new owner. The show is widely expected to close, but perhaps not soon as Hard Rock has the rights to use the Mirage name for up to three years and the contracts for the cast have been extended through 2023.
The North Strip Continues to Grow
Before Resorts World Las Vegas opened in June, 2021 the North Strip had become a bit of a wasteland. Once you passed Wynn Resorts' (WYNN) namesake resort and its sister property, Encore, the north Strip became quite bleak. You had dated properties like Circus Circus and the unique (but also in need of renovation) Strat and not much else.
Now, Resorts World will be joined by Fontainebleau, a resort-casino that has been in development for nearly 20 years, and is on track to open in 2023. There's also an NBA-ready arena along with a hotel being developed in the north Strip and Circus Circus began a $30 million makeover.
The renovation will not include a change in the hotel's concept. Instead, painting will be done to restore the original bright "circus" feel and the signature "big top" will be renovated as well. The resort's pool was also totally revamped, doubling its capacity and giving it a "new resort" look. In addition, new rides including "NebulaZ and Twistin Tea Cups," have been added to the Adventuredome theme park area.
On top of that, the Las Vegas Fairgrounds, a site adjacent to Circus Circus remains in contention to become home to a new stadium for Major League Baseball's Oakland Athletics.
Caesars Fails to Sell Flamingo
For much of the year, Caesars CEO Tom Reeg talked about selling a Las Vegas Strip property. The deal would both help the company pay down some of the $15.5 billion in debt it took on when it merged with Eldorado Resorts in 2020 and raise the value of its Strip rooms by lowering its supply.
A lot of rumors were flying that Planet Hollywood or Paris Las Vegas might be the properties for sale, but ultimately Caesars confirmed that it was Flamingo that was being put up for sale. Reeg seemed confident that a deal could be made.
"For us--and there's--there are plenty of interested parties. Obviously, the financing environment is what it is. And if that's going to impact what someone will pay, there is a level where we're not going to chase it. I'm very happy to just clip the free cash flow and come back later," he said.
He was also clear that a deal did not have to happen.
"As we have discussed, this is a discretionary trade for us," Reeg said,
Ultimately the deadline passed and the Flamingo was not sold, which, given the ever-escalating value of properties on the Las Vegas Strip, may prove to be a blessing for Caesars which retains the dated but well-located resort-casino.
Tilman Fertita Becomes a Las Vegas Strip Player
Tilman Fertita, a billionaire who owns the Houston Rockets and the Golden Nugget resort-casino on Fremont Street, made some major moves on the Las Vegas Strip in 2022. He made a major investment in Wynn Resorts, and he purchased a piece of land on the Strip where he plans to build a top-tier (Wynn-like) resort-casino.
The billionaire purchased a strip parcel in April located between Caesars' Planet Hollywood and the MGM Grand. Recently, Fertita's company filed plans to build a 43-story, 2,420-room hotel-casino on the property, the Las Vegas Review-Journal reported.
"The upscale project, on roughly 6 acres at the southeast corner of Las Vegas Boulevard and Harmon Avenue, calls for restaurants, convention space, a spa, wedding chapel, auto showroom and a theater with around 2,500 seats, Clark County records show. It would also include suites and villas, VIP salons and a bar and lounge for high-limit gamblers, building plans indicate," the paper shared.
With his 6.1% stake in Wynn--a passive investment for now--along with this property, Fertita has quickly made himself one of the biggest players on the Strip.
