New Fight For Control Of The Las Vegas Strip

25 years ago battling for control of the Las Vegas Strip meant killings and bombings, but today large corporations, private equity firms, and billionaires are fighting for control of the heart of the gaming world. The crime and violence is gone, but with the cost of a competitive Las Vegas Strip hotel casino well over a billion dollars the stakes are higher than they have ever been.

After two huge mergers, one between MGM Grand and Mirage Corporation, and another between MGM Mirage and Mandalay Corp, MGM Mirage Corporation controls over half of the hotel rooms on the Strip. Their hotel casinos include, from south to north as you travel on The Strip: Mandalay Bay, Luxor, Excalibur, New York-New York, MGM, Monte Carlo, Bellagio, The Mirage, Treasure Island and Circus Circus. MGM Mirage also developing CityCenter, an incredible collection of high-rise condominiums located between Bellagio and Monte Carlo on land that was once the Dunes golf course.

Harrah's Entertainment, formed when Harrah's bought out Caesars Entertainment, is the next largest owner of hotels on the Las Vegas Strip. Their casino hotel holdings include, from south to north: Paris, Bally's, Bill's Gamblin' Hall, Caesars Palace, Imperial Palace and Harrah's. They also own the Rio, which is just west of The Strip. In the end of 2006, two private equity firms, Apollo Management and Texas Pacific Group, purchased Harrah's Entertainment for over $15 billion. Before the sale it was rumored that Harrah's was going to implode all of their hotels from Bill's Gamblin' Hall to Harrah's and build a huge casino complex. Whether the rumor was true and whether the new ownership will make this bold move remains to be seen. Recently Harrah's announced that they would be spending a billion dollars renovating the venerable Caesars Palace, and they are also going to build a modern 20,000-plus seat sports and entertainment center behind Bally's.

After MGM Mirage and Harrah's, the remaining players are currently limited to one hotel-casino each, at least until the Sands Corporation complete Palazzo, the sister property to the successful and opulent Venetian Hotel. Major stockholder Sheldon Adelson is the third richest man in America, in a large part due to his wildly successful holdings in Macao. The Wynn is the stunning hotel built by Wynn Resorts under leader Steve Wynn, and they are also expanding. Another Billionaire, Carl Icahn, is the majority shareholder in the Stratosphere Tower. The hotel formerly known as the Aladdin is now Planet Hollywood; the already beautiful hotel has made needed changes and upgrades that will make them competitive. Other hotels include the aging Tropicana, Riviera, and Sahara.

Boyd Gaming is developing Echelon, a multi-hotel, entertainment, and meeting center located on the old Stardust property and on adjoining pieces of land. As the owner of the Coast Hotels, Sams Town, California, Fremont and others, Boyd is a major player in downtown and local Las Vegas but wants in on the Las Vegas Strip.

In addition to Mgm Mirage's CityCenter, there are numerous other high-rise condominium complexes in development on the Las Vegas Strip, including one being built by Donald Trump on a site owned by the owners of the recently closed New Frontier. The success of many of these projects is not guaranteed at this time, although most look like they are going to be able to sell their condos at a steep price. Trump looks like a sure thing, and plans are being made for another tower.

The days of the mob in Vegas are done. Federal scrutiny and the incredibly large amounts of capital required to open a casino have put an end to that era. But the days of maverick ownership aren't done yet, with individuals like Sheldon Adelson, Steve Wynn, Carl Icahn, and Kirk Kerkorian still involved (although none of them outright own a casino), but it seems like large corporations or incredibly well heeled private equity firms are the future of the Las Vegas Strip.

Mike McDougall has lived in Las Vegas for over 20 years, and his business has made it necessary for him to travel the Las Vegas Strip on a weekly basis.