Las Vegas Casino Hotels Palazzo, Venetian Face Bankruptcy
I’ve always been a bit put off by the tasteless extravagance and decadence of Las Vegas. Even as the rest of the nation was buckling up to face the inevitable recession, hotels in Las Vegas were pushing for expansion and grand openings with celebrity hosted parties, fireworks and spewing a spigot of money like there was no tomorrow.
And for the newly opened $1.9 billion Palazzo, and its sister casino resort The Venetian, there may be no tomorrow. Bloomberg News reports that Las Vegas Sands Corp., billionaire Sheldon Adelson’s casino company, fell the most in New York trading since going public after saying it may default on debt and face bankruptcy. The casino owner, which had $8.8 billion in long-term debt at the end of June, said in a regulatory filing today that it probably won’t meet the requirements of loans arranged by Citigroup Inc., Goldman Sachs Group Inc. and Lehman Brothers Holdings Inc. unless it cuts spending on developments, boosts earnings at its Las Vegas Strip casinos and raises more capital.
And this is going to be very difficult. For starters, with a stagnating economy and consumers unwilling to shell out the big bucks which the casinos need, its highly unlikely that earnings on the Vegas Strip are going to go up in 2009. In fact, there’s a good chance that earnings might go even lower, as consumers demand discounts and lower room rates for Las Vegas vacations.
Secondly, raising capital means that the banks would have to throw in god money after the bad, which is even more unlikely, given the recent history of a spate of bankruptcies with banks unwilling to step in and save their own money.
As far as cutting spending on development is concerned, that horse has now bolted, and its too late. Maybe they could lay off a few staff and make some cosmetic changes, but the bulf of the spending has either already been done, or its in an advanced stage, like their $4 billion casino project in Singapore, and pulling out now would put in jeopardy the very existence of the Las Vegas Sands Corp.
To put it in a nutshell, the House doesn’t always win… This is one time they gambled away everything, and lost.
Photo by jimg944 via flickr (creative commons).
Posted on November 9th, 2008 by Thomas
Filed under: Hotels, News
Goooood! The human resources department at the Venetian is severely, mentally retarded! They wouldn’t offer me a position because I didn’t specify that I had experience with Exchange. When I tried to explain to them Outlook and Exchange are one in the same, this retarded bitch was clueless about it. Come to find out, they have non-technically inclined idiots trying to vet and hire technical experts! No wonder the Venetian is going bancrupt! They’re soooo stupid and have the most unqualified discriminant assholes working for them… god I can’t wait til they fire everyone and blow that casino to bricks and rubble!
I understand your pain, Bill. Must be horrible to find out that people who know nothing about your job have the power to give you one.
Las Vegas hotels have seen a lot of setbacks this year, with tourism down about 7 percent. For people who do want to indulge, though, it’s a good thing, since the hotels are desperate to fill empty hotel rooms. It’s a great time to find good deals to Sin City. And there’s a lot to do there besides gamble. It’s a popular spa destination and Red Rock Canyon is close if nature is more your style.