On April 19, 2007, casino proprietors who have old Las Vegas properties or extra land are grappling with different ways to get additional value for their own properties in light of the high land properties in Las Vegas.
With the price tag for the land properties in the area costing around $40 million per acre, especially for the prime and high class spots located right on the Las Vegas Strip, insiders said that a lot of casino owners are eying joint partnerships that would allow them to monetize their own properties because of the higher value of the land in the area, instead of the lower value that the public real estate industry is giving them.
The joint partnership would also give the casino owners the added reward of being eligible to receive some of the profits from the remodeled gambling casinos. Usually, casinos owners that have outdated but good property have 2 options to get their property value - sell the property or remodel it.
Wahid Chammas, a senior analyst from the Janus Capital Group, a major shareholder in casino stocks, said that there is already a 3rd option of sharing the remodeling expenses with somebody else so that a company can scale down their capital expenditures or the capex and by turning your assets into cash with the current prices for the land.
This technique is just one example of how most Las Vegas casino owners are thinking of ways to take advantage of the value of their land. The MGM Mirage (MGM-Cramer's Take-Stockpickr) is at the front of such talks and the MGM Grand has stressed that they are looking for different ways to explore their options, like joint ventures.
06/26/2007 22:08 PM
Ann Pettersson