It has been more than two years since the last major resort opened on the Strip. Since then, most construction projects in the resort corridor have been room remodels, store renovations and other interior work.
That soon could change.
If all goes according to plan -- and that's a big "if" in Las Vegas -- the Resorts World project would boost the local construction sector, which after being practically wiped out during the recession is finally beginning to show signs of improvement.
Construction employment in Nevada has plunged 66 percent since the peak of the boom days. There were 50,200 construction workers employed in the state in December, down from 146,400 in June 2006. Nevada saw the largest percentage drop in the country during that period.
Burke Construction Group CEO Kevin Burke said he was "surprised and enthused" when he heard about the Genting project. The resort is a great sign of confidence in Las Vegas.
It "sends an entire ripple effect through our industry that is so positive," he said.
The Strip's oversupply of hotel rooms, casino space and restaurants has kept new construction at a standstill and made renovations "the word of the day for the last few years," Penta Building Group President Jeff Ehret said.
He described Genting's project as a "terrific boost" to the construction industry, though it's much larger than he would have expected, given Las Vegas' sluggish economy.
"Hopefully there's enough demand in order to absorb that supply," he said.
The last major resort to be built on the Strip was the $3.9 billion, 2,995-room Cosmopolitan, which opened in December 2010.
Gov. Brian Sandoval noted at the Genting announcement that thousands of jobs will result from Resorts World opening.
Not only will the company need construction workers, but thousands of gaming and service industry jobs will be created once the megaresort opens. Not only that, hundreds more will be generated to support the resort -- drivers to deliver products to the property, accountants and tax specialists to work on the corporate side, even teachers to accommodate the children of employees.
The only downside is that hiring won't begin for several months. Ground isn't expected to be broken until next year. Designers, planners and architects will be needed early in the process, but the most of the hiring won't happen until 2014 and 2015.
The Las Vegas company that owns and operates several downtown casinos and Sam's Town on the Boulder Strip once had the iconic Stardust in its line up, but the hotel-casino was imploded six years ago to make way for Echelon, which was destined to be the CityCenter of the North Strip.
Both Boyd and Echelon fell victim to the Great Recession, and the company suspended construction on the site Aug. 1, 2008. Analysts repeatedly said it was a good move by Boyd because continuing work on the project as visitor volume plummeted could have led to bankruptcy.
But Boyd has little to show for the time and effort it spent on Echelon. Genting picked up the 87-acre site for $350 million. By comparison, Phil Ruffin sold the nearby 36-acre New Frontier site in 2007 for $1.24 billion.
While some industry observers say Boyd is happy to be out from under the Echelon chapter of its history, it's hard to make a case for the company being happy about losing the Stardust -- a casino that was making money -- investing in a failed dream and selling the land for pennies on the dollar.
Genting also could be bad news for other luxury resorts.
Gaming analysts say Genting will bring a new era of competition for high-end players on the Strip. Companies such as MGM Resorts International, Caesars Entertainment, Las Vegas Sands and Wynn Resorts have reason to be concerned about losing customers -- particularly Asian whales -- when Resorts World opens.
Michael Paladino, a senior director for the gaming, lodging and leisure sector of Fitch Ratings, said the added capacity of both Resorts World and SLS Las Vegas could drive down average daily room rates.
"The Las Vegas Strip is still in the midst of a choppy recovery, so the additional room and gaming capacity provided by SLS and Resorts World Las Vegas is notable, particularly if this is the onset of a resurgence of supply growth, given the low interest rate financing environment," Paladino said in a recent report.
Genting's presence in New York, where it operates the largest slot machine floor in the world at the Aqueduct Racetrack in Queens, could entice more New York gamblers to Las Vegas, Paladino said. But it is unlikely they'll play at the Venetian, Bellagio or Wynn if they are marketed to by Genting.
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