Las Vegas still being beaten by Macau
Down on Las Vegas’s Sunset Strip all is not well. The Casino industry is having to face up to its disadvantages. The incomplete Fontainebleau Casino Complex remains a building site despite being supposed to have 3889 hotel rooms, 24 different restaurants and a massive gambling hall. But the project has stalled.
Las Vegas still heaves with individuals. The volcano at the Mirage still erupts on the hour, the gondolas still flow down the Venetian’s fake waterways and the Wynn which was recently in the newspapers due to a British Prince’s visit still operates with a healthy bed night rate..
Nevertheless, all is not well in Sin City.
The Fontainebleau’s backers went belly up having invested $3bn (£2.3bn) on the place. Now is stands as a empty shell with its metal skeleton corroding in the desert wind.
Its development – and Las Vegas’ continued growth – came to an unexpected end with the economic problems when, after years of unbroken development, Sin Town became the property foreclosure capital of the United States.
The small Chinese territory of Macau has now outstripped Las Vegas in growth. This tiny territory in the Pearl River Delta of the South China Sea is now the world leader. Macau had surpassed Las Vegas with regards to betting earnings in 2006. Now the isle rakes in an amazing five times the town’s complete pot, over $30bn (£23bn) a season, as opposed to $6bn (£4.5bn) gained in Las Vegas.
In 2012 Macau’s development has dropped for the first time since betting was deregulated a several years ago. A visit to almost any of China’s provincial places will go some way to describing why. China is suffering from a lack of growth. In all Chinese cities there are now massive tower blocks, dead-eyed hulks of buildings built with borrowed money but never occupied, a small-scale variations of Vegas’s Fontainebleau, flats and office buildings standing empty.
A property developer in Las Vegas is quoted as saying that prior to the recession Las Vegas seemed to be self generating and that growth was never ending. By 2006, more than a third of the workers in Las Vegas were employed in construction and that Vegas was “gambling on growth”.
Of course, the bet did not pay out.
The economic collapse happened and this was followed by the miracle of development fading and prosperity disappeared as real estate asset prices dived. Billions in value has been wiped from the balance sheets . As this scenario played out across The United States, the financial institutions were left with financial obligations that could still jeopardize us all and bring the entire economy to its knees.
China has been one of the few shiny areas on the globe, as its economic system has continued to flourish. But even here there are warning signs as we have discussed above. But the Chinese culture embraces gambling in all its forms and the Hydrofoils still run from Hong Kong to Macau so while Las Vegas suffers in decline Macau flourishes almost unabated.