Jim Murren is playing the long game on the Strip.
“We have a very strong feeling of what Las Vegas is going to look like five to 10 years from now,” the MGM Resorts International chairman said recently when describing the details of the Park, an entertainment and retail complex between the company’s New York-New York and Monte Carlo properties. “It’s very different from today—and when this is done in 2016 we’ll see if we’re right.”
The Park is a bet on both the great outdoors (the kind of urban walking experience we’ve seen at Caesars’ Linq) and also on the great indoors (it will be anchored by a 20,000-seat arena). Both bets have roots in Las Vegas’ heritage as an entertainment capital, but they’re notable for their openness to the street and for the degree to which gaming is marginal. More than ever, resort operators want to offer a full-spectrum experience.
And with MGM’s massive footprint of hotel rooms and convention space, more Park-type developments could follow between and among the company’s holdings.
An interesting way to ponder the Strip’s trajectory is to follow Murren’s lead, play the long game, and imagine what it will look like in 2019. Here’s a glimpse:
- The Linq’s High Roller observation wheel will have long since made its way into the national imagination as a symbol of the city.
- The MGM arena (on which the company and its partner, AEG, have already broken ground) will have already hosted three years of concerts and sporting events. Other Strip projects will be even more seasoned: The Cromwell is already (somewhat) open. SLS appears on track for opening late this summer. Likewise, the Delano, a refresh of Mandalay Bay’s THEhotel, will be officially “open” this fall.
- The City of Rock—a planned 80,000-capacity outdoor performance venue on the southwest corner of Sahara Avenue and Las Vegas Boulevard—will be 4 years old and hosting its third Rock in Rio festival. Future festivals? They’ll depend on how well the first three are received, and whether MGM determines that the land can be better used to house a new resort, as was initially intended.
- If annual visitation heads toward the 45 million mark, we’ll see plenty of construction. Prime candidates for development include underused land at the Riviera and Circus Circus, as well as MGM’s South Strip land bank. Will Fontainebleau have fallen by this time, to make way for something more in line with the Strip’s new direction? It’s likely, assuming the demand that some in the industry are forecasting materializes. That would leave the former New Frontier site across from Wynn as the most coveted piece of undeveloped land on the Strip.
Who will be coming to Las Vegas in 2019? If current trends continue, the average visitor to Las Vegas should be somewhere in his mid-40s, and will enjoy shopping, drinking, dining and live entertainment more than gambling. At least 25 percent of visitors will hail from outside the United States. A substantial portion will be here on business, attending conventions and expositions at the newly remodeled Las Vegas Convention Center and Global Business District, the expanded Mandalay Bay Convention Center, and facilities in resorts up and down the Strip, including the massive Sands Expo Center.
Many of those visitors might be staying at a property that will have been open for at least two years: Resorts World Las Vegas. Built by Malaysian casino giant Genting, this massive project—the cost is estimated as high as $7 billion—will mark the return of themes to the Strip. Its water park and Strip-front Chinese village are expected to attract both high-rollers and middle-market visitors from Asia.
But bigger might not be the predominant direction. If “boutique” properties such as the Cromwell and Caesars Palace’s Nobu Hotel prove popular, it is likely that other resorts will subdivide and rebrand their spaces, leading to a proliferation of “hotels within a hotel” on the Strip.
Also, wholly new properties might not have much in the way of casino space. Gaming revenues have yet to reach their pre-recession highs, and Strip gaming win as a percentage of the national economy remains below its mid-2000s levels. The international high-rollers who make up an increasing segment of total gaming win don’t require acres of slot machines. As visitation rises and gaming win inches along, some may decide that nongaming properties are the best investment, and leave the increasingly competitive gaming market to the established titans.
Of course, there are always surprises that can send astray the best laid plans—the recession squashed hopes that the Strip would become a condominium corridor, after all—but the projects already announced tell us a lot about what the Strip will look like in 2019.
David G. Schwartz is the director of UNLV’s Center for Gaming Research.