Sunday, October 16, 2011

telegraph: las vegas is so over...,

Telegraph | A faded blonde in her mid-forties with a gaming-room pallor said it was all so sad. When she heard the Sahara was closing, she said, she had come and had a farewell drink in every bar. Two labourers were prising an ornate wooden pillar 12ft high from the wall. 'It wouldn’t fit into my apartment,’ the blonde said. She gave a deep sigh. 'Las Vegas,’ she added, 'is so over.’

To the tourists who flock up and down the Strip, the impact of the recession on Las Vegas might not be immediately apparent. The casinos still thrum with cries of jubilation and, more often, the groans of disappointment. Queues still form at the hotel-theatres where The Lion King and Viva ELVIS are playing.

Few people have any reason to venture into the suburbs, where, if you look carefully, a different vision of Las Vegas presents itself: the rows of foreclosed properties; the mile upon mile of unfinished housing developments; the 'going out of business’ signs on shops.

For a period in the 1990s and 2000s, Las Vegas was the fastest-growing city in America. Drawn by the flourishing fortunes of the casino industry (and too by Nevada’s benign tax laws: the State has no individual or corporate income tax, most of its revenue coming from gambling and sales taxes), workers flocked to the city. In the four years leading up to 2007, the population increased by 104 per cent – the largest population growth of any city in the entire United States. (It now stands at 2.03 million.)

But Las Vegas’s days as a boom town are long gone. At 14 per cent, unemployment is the highest in America (the national average is 9.1 per cent). House prices have fallen 58.1 per cent since their 2006 high – the biggest losses of anywhere in America, while according to the website RealtyTrac, which specialises in foreclosed properties, Las Vegas is the nation’s foreclosure capital. Some 70 per cent of homes in Las Vegas are thought to be 'under water’, or in negative equity, meaning their value is worth less than the amount owed on the mortgage, while foreclosure notices have been served on one in 16 properties. A survey last year by the local Las Vegas Review-Journal and Channel 8 News Now found that 34 per cent of locals would leave Las Vegas if they could find a job elsewhere, or if they weren’t underwater on their home loan.

A report last year by the Brookings Institute and the London School of Economics ranked Las Vegas’s economic performance in 2010 as one of the five worst out of 150 metropolitan areas around the world, due in large part to the collapse of the real estate market. Many of the problems are down to Las Vegas having relied too much on one industry for its growth: 20 per cent of the town’s workforce is employed in gaming and tourism.

In the peak years of 2006 and 2007, roughly 39 million people per annum flocked to Vegas. In the worst of times – 2008 and 2009 – that number fell by only three million, but the effect on the complex arithmetic of the Vegas economy was critical. Room rates dropped, and crucially so did gambling revenues. Between 2007 and 2010 gaming revenues on the Strip fell by 15.4 per cent – $1.05 billion – driving three major casinos into bankruptcy.

Nor can Las Vegas any longer claim to be the gambling capital of the world. Last year gaming revenues in Macau were four times those generated on the Strip, and this year it is estimated that Singapore will also overtake Las Vegas. Local operators such as Las Vegas Sands and Wynn Resorts, the company run by Steve Wynn, who is credited with much of the Strip’s burgeoning economic growth over the past 20 years, now get the lion’s share of their revenue from Asia, and Wynn is said to be contemplating relocating his centre of operations to Macau.


Uglyblackjohn said...

Vegas is America.
When people realized that the dream was not sustainable, everthing lost it's value.
People in many states can now go to their local Indian casino to lose their rent instead of going all the way to Vegas.
With it's superfluous decor and lifestyle - Vegas was created to be ephemeral.