Posted:
#1
I'm sure everyone has heard this by now, so let's pontificate.
Ruffin bought the New Frontier in 1998 for $137 million and sold it at the height of the real estate boom in 2007 for $1.2 billion. The casino was razed by its buyers and the new project, Echelon, has been put on hold like practically everything else except CityCenter due to the credit crisis.
MGM, in need of cash to complete CityCenter, allows Ruffin to come in and "steal" Treasure Island for $775 million. TI already generates about $100 million a year in net revenue (even though the slowdown in the economy will no doubt put a major dent in that number) so the investment should pay for itself in about 10 years. Not only that, but TI just completed about $85 million in upgrades, so Ruffin has bought a four-star resort in need of no upgrades. Don't buy the notion that MGM felt it needed to concentrate on its most prized assets and divested itself of TI because of that. CityCenter needed Dubai money to get it to this phase, and the paramour has little else to invest because of the plummeting oil prices (there are alot of idle cranes in the ever-growing Dubai).
Sources say that Ruffin wanted to buy Mirage also, which seems natural since the two resorts are linked by a tram and share some admin offices. But Ruffin would've needed financing for that and again, the credit markets are ultra tight, so he couldn't.
Personally, I think this is good for the strip. The more players, the better. And I think we're about to enter an era where we'll have more independent operators. Harrah's is in such deep shit (they run the namesake, Paris, Rio, Caesar's, Bally's, Imperial Palace, Flamingo), they'll have to dump some properties. Get ready for famished vultures to come in and gobble them up. I would like to see Caesar's returned to its original glory and I think only an independent operator could do that. Bally's and IP might be destined for the wrecking ball.
Back to TI. I've posted this in the past, but TI is my favorite resort in Vegas. It has an accomodating feel, not too flashy or too pretentious. Rooms are nice, buffet is excellent, sportsbook is small and comfortable, Canter's and Social House are great places for what they serve. It's an almost ineffable quality, but I feel I "fit in" here. And now with an independent operater, I think it may be even better. Don't believe those that say Ruffin ran New Frontier into the ground. The place had been limping to the grave for years. Ruffin essentially wanted to implode the place and build something resembling Montreaux. From all accounts, he's a good guy for whom to work.
But we'll see. Now that football season is almost over, I probably won't go back to Vegas until the summer and even then I prefer the Mandalay Bay pool, but I might spend some TI just to check it out (the Ruffin purchase is expected to close in May).
Ruffin bought the New Frontier in 1998 for $137 million and sold it at the height of the real estate boom in 2007 for $1.2 billion. The casino was razed by its buyers and the new project, Echelon, has been put on hold like practically everything else except CityCenter due to the credit crisis.
MGM, in need of cash to complete CityCenter, allows Ruffin to come in and "steal" Treasure Island for $775 million. TI already generates about $100 million a year in net revenue (even though the slowdown in the economy will no doubt put a major dent in that number) so the investment should pay for itself in about 10 years. Not only that, but TI just completed about $85 million in upgrades, so Ruffin has bought a four-star resort in need of no upgrades. Don't buy the notion that MGM felt it needed to concentrate on its most prized assets and divested itself of TI because of that. CityCenter needed Dubai money to get it to this phase, and the paramour has little else to invest because of the plummeting oil prices (there are alot of idle cranes in the ever-growing Dubai).
Sources say that Ruffin wanted to buy Mirage also, which seems natural since the two resorts are linked by a tram and share some admin offices. But Ruffin would've needed financing for that and again, the credit markets are ultra tight, so he couldn't.
Personally, I think this is good for the strip. The more players, the better. And I think we're about to enter an era where we'll have more independent operators. Harrah's is in such deep shit (they run the namesake, Paris, Rio, Caesar's, Bally's, Imperial Palace, Flamingo), they'll have to dump some properties. Get ready for famished vultures to come in and gobble them up. I would like to see Caesar's returned to its original glory and I think only an independent operator could do that. Bally's and IP might be destined for the wrecking ball.
Back to TI. I've posted this in the past, but TI is my favorite resort in Vegas. It has an accomodating feel, not too flashy or too pretentious. Rooms are nice, buffet is excellent, sportsbook is small and comfortable, Canter's and Social House are great places for what they serve. It's an almost ineffable quality, but I feel I "fit in" here. And now with an independent operater, I think it may be even better. Don't believe those that say Ruffin ran New Frontier into the ground. The place had been limping to the grave for years. Ruffin essentially wanted to implode the place and build something resembling Montreaux. From all accounts, he's a good guy for whom to work.
But we'll see. Now that football season is almost over, I probably won't go back to Vegas until the summer and even then I prefer the Mandalay Bay pool, but I might spend some TI just to check it out (the Ruffin purchase is expected to close in May).
0
Hot Forum Topics
