A new kid on the block will be emerging on the Las Vegas Strip beginning in 2015. In fact, a bunch of new kids are going to make a portion of the famed Strip look a lot different.
Australian billionaire James Packer finalized the purchase of a 35-acre parcel on the north end of the Strip on Aug. 3. The New Frontier, an old and aging property previously was on that site. After a long and historic run, the New Frontier met its demise in 2007 when it was demolished.
Packer’s plans for parcel
Packer plans a hotel-casino on the parcel. In a statement released on Aug. 3, Packer said he will partner with ex-Wynn Casino president Andrew Pascal and investment company Oaktree Capital Management.
“You can’t be in the gaming industry and not have a special reverence for Las Vegas — that’s where it all began,” Packer said in a statement. “While we fell short in past attempts to enter that market, we now have the ideal opportunity.”
The parcel on the Strip is one of “the best pieces of undeveloped land on the Las Vegas Strip,” said Oaktree president Bruce Karsh in a statement.
While nothing has been finalized, Packer did indicate in the statement that he hopes to break ground on new construction for the hotel-casino sometime in 2015. The new property should be open to the public by 2018.
The Australian Securities Exchanges released a statement on Aug. 4, saying that Packer’s company, Crown Resorts Ltd., spent $280 million on the project, which includes acquiring the land.
The parcel acquired by Packer’s Crown Resorts had been the subject of one of the most expensive real estate transactions ever in Las Vegas’ history.
Most wanted piece of land
In 2007, two Israeli-based companies had designs of a $5 billion hotel-casino on the very same property. The companies paid $1.2 billion for the parcel — about $24.8 million per acre. The New Frontier was razed, but the project never got off the ground because of the recession. Since then, the nearly 35 acres has been dormant.
The site of Packer’s purchase sits next to the location where Malaysian-based Genting is planning to construct a $4 billion resort. Genting took over Boyd Gaming’s failed Echelon project, which was scuttled because of the financial crisis of 2008.
Genting’s project is expected to include 3,000 hotel rooms, a 4,000 seat theater and a casino with a combined 3,500 slot machines and table games.
Genting officials met with Nevada gaming officials in May 2014 and also revealed plans for a rooftop sky park and observation deck standing 670 feet above the Strip. The Federal Aviation Administration already has given its seal of approval to the deck.
The north end of the Strip will have a decidedly different look by the end of the decade with the Genting project and Crown’s casino-resort.
Packer and Las Vegas
This is not Packer’s first foray with the Las Vegas Strip.
Packer has had affinity for Las Vegas for a while now.
His Fountainebleau casino-resort, which Crown invested a reported $250 million, ended up in bankruptcy protection in 2009. Lenders, who had invested nearly $800 million in the failed project, filed a lawsuit against Packer and Crown. That lawsuit was settled in June 2009.
Crown also invested about $320 million in 2009 the Cannery, an off-Strip casino in North Las Vegas. Reportedly, the company has not received much for its investment.
Packer, whose Crown Resorts operates casinos in London and Macau as well as Australia, also had shown interest earlier this year in purchasing the Cosmopolitan of Las Vegas but was rebuffed.
This time Packer might be on his way to hitting a home run.
Just a few steps away and across the street on the east side of Las Vegas Boulevard sits the SLS Hotel-Casino. Built on the corner of Sahara Avenue and the Strip, SLS was built on the former site of the Sahara Hotel, which historians note as the famous hangout of the hard-partying Rat Pack era stars like Sammy Davis Jr., Dean Martin, Peter Lawford and Joey Bishop to name a few.
The SLS is slated to open in August.
Further south of these projects, there are signs of recovery for the world’s second largest gaming area.
The MGM recently broke ground on a $350 million arena project adjacent to the New York New York hotel and casino. Included in this project will be 80,000 square feet of shopping, a park and a plaza.
The Wall Street Journal reported that gaming analysts also see positive growth on the Las Vegas Strip, and the time for Packer to develop is right.
Revenue from gaming at Strip properties has increased 3.5 percent during the first six months of 2014. Even more significant is that revenue per available hotel room has skyrocketed nearly 10 percent during the same time over 2013.