When it comes to buying property on the Las Vegas Strip, you’re going to struggle to find anything available. However, just next door to the MGM Grand, an 18-acre site exists which houses a Walgreens and Travelodge, which is drawing quite a bit of interest.
Several offers over the past few months have come to Spectrum Group Management LLC, which took over the property in 2010. The site was initially supposed to be turned into a mega Elvis-themed casino-resort. A $475 million mortgage defaulted on in 2008 scratched those plans.
The group considers the land “the last available site of any size located in the heart of the Las Vegas Strip.” Investors are hoping this will be just one piece, which helps Vegas return to its 2007 heyday. Across from the now-closed Riviera, the Genting Group broke ground on its Resorts World, while right next door Crown Resorts Ltd. is planning to develop its own mega resort.
The Spectrum site was valued in 2007 at $750. Just one year later, it was worth just $220 million. When Genting purchased their property to build on in 2013, they paid $4 million an acre. Yet at the height in 2007, that land was valued at a staggering $34.7 an acre.
While billions continue to be invested in the city, it should be noted that gaming revenue continues to remain stagnant, with a flat first quarter compared to last year. Steve Wynn has even gone on record saying he would be happy if the second quarter was flat from last year. Yet again, a decline in baccarat revenue was the culprit for poor performance.
