How much help does the north end of the strip need?

I don't make enough time for creative writing. I love writing, I really do. But it's not the most efficient way of communicating thoughts and ideas, and I'm not the most colorful, animated writer out there.

If I lived in Vegas I'd definitely be producing video content in conjunction with, or in place of, this blog.

I don't religiously watch any of the Vegas "vlogger" channels on YouTube. The one I watch the most often is often not Vegas-specific, but I consider Wonderhussy a Vegas vlogger. Her exploration videos of the Nevada desert are a lot of fun.

I periodically watch "Jacob's Life in Vegas" for local commentary. He has been at it for a long time, discusses a variety of Vegas topics -- not all of which are of interest to me -- and mixes in the sights and sounds of Sin City now and again.

His recent video about the north end of the strip isn't particularly revealing, but he has a couple of interesting observations about its future, and I can't disagree with him.

As any Vegas regular knows, the north end of the strip isn't nearly as spectacular as it use to be. We've lost properties big and small, historic and not-so-historic. We had a decent investment made into a boutique hotel just off the north end of the strip, which crashed and burned in spectacular fashion. And we've had a major investment in revitalization fall flat on its face. Never mind the fact we lost a tired landmark of the north strip less than four years ago, demolished for a promise that has yet to be realized.

Jacob talks about the sad state of affairs that is the north end of the strip, and speculates about what the future holds. There's promise.

We have a decade-old unfinished building that is allegedly going to finally open in my lifetime, and the stalled project on the former site of the grand Stardust is finally taking shape. We know that the  Las Vegas Convention and Visitors Authority, which bought the Riviera property and leveled it, is suggesting the time has finally come to do something with the property. In the meantime the former Sahara, which bombed with its rebrand as a upper echelon property, is getting another major cash infusion by a known player in the casino industry, and the tired, alienated Stratosphere is rebranding itself with a shorter name and a cash infusion, as well.

I'm not sure how much those cash infusions will help the lonely former Sahara and Stratosphere, but the places are rather depressing if you drop by at the times I do, which is not Friday and Saturday nights or during the Super Bowl. People rent the rooms and stay at the property, but given their location and their lack of economic incentive to visit, you've got to really want to see a show or eat at a restaurant at either property in order to pay a visit.

Everybody agrees that new development on the north end will benefit all parties involved. Jacob notes that the addition of new rooms is good for the consumer, as it creates competition. That's true, but in the past decade or so we've lost the Riviera, Stardust and New Frontier, not to mention the one-time off-strip holding of Debbie Reynolds and the Westward Ho, a smaller, low-cost option on the strip that I stayed at during a solo trip in 2004, with no complaints, given I was a poor bastard. There are always new rooms opening on the strip, and we have seen plenty of high-end rooms at Aria and Cosmopolitan replace the lower-end rooms we lost to the north.

What will new development do for the north end of the strip? I'm highly skeptical it will do a lot any time soon.

If you build a new casino, people will visit it. People love shiny and new. New rooms and a new casino property are sure to draw plenty of visitors. But that alone won't sustain a property. Lucky Dragon proved that.

But the Resorts World project at the site of the former Stardust, is much bigger, surely it will be enough, in and of itself, to keep people coming back, yes? Maybe. Location isn't an insurmountable obstacle, but it doesn't help, and Resorts World is just far enough away that it won't benefit from the foot traffic that Bellagio gets from both north and south. It would take quite an array of attractions to replicate Bellagio traffic at Resorts World.

Jacob suggests that Resorts World, as well as the incomplete Drew, the tower north of the former Riviera, will have to offer deals to get people to spend their time and disposable income. He's right, but that's unlikely. You don't build hotels in today's dollars in order to offer discount rates. Yes, casinos will always offer comped rooms to their regular gamblers who have a habit of dropping cash on the property, but you don't open a hotel in 2020 and offer room pricing that competes with Comfort Inn. There will always be incentives available to fill the rooms thanks to the fiercely competitive nature of Vegas resorts, but you won't see Orleans pricing at new projects on the north end of the strip. And it's not as if the Bellagio and Wynn are turning away their high-buck clientele on a regular basis, otherwise we'd have seen more construction in the past several years.

The biggest boost to any property developing on the north end of the strip will be the expansion of the convention center. Originally that expansion was supposed to be right up to the sidewalk of the strip, but now there's rumblings a portion of the former Riviera property is available for purchase and development. On the surface, that seems like a brilliant strategy for redeveloping the property.

Once the convention center expands, all the properties on the north end will benefit, without question. Will that be enough to turn the former Sahara into the same bustling property as it was in the 1970s? Perhaps. Until that day, when all of the properties are operating and feeding off of each other, it's going to be more famine than feast by the time you head north of the Wynn.

Jacob also notes that the new properties on the north end won't be able to get away with the same gouging that other strip properties do. Namely: Charge for parking. I tend to agree. Asking people to pay for parking on the strip is like asking people to pay for parking at a suburban mall. It's ridiculous. It has hurt the strip overall, although how much depends upon whom you ask.

I think new properties can get away with charging for parking, if they can drive enough high-end customers to the property. But given that's unlikely, the new properties had better do everything they can to entice customers, and not charging for parking will be an important one. I could see a scenario where free parking and an expanded convention center would cause problems, but we'll ignore that for now.

It seems simple...probably too simple. The best way to fill a casino and keep it filled is to offer old-school Vegas value. The problem is that new construction cannot pay down its debt and sustain its operation by offering deep discounting. Anything that opens on the north end of the strip in the coming years is going to walk a fine line between the two, and can't afford a major misstep in either direction.

What we can learn from the closing of two casinos

It’s not always location.

Those of us who spend too much time thinking about, reading about and talking about Las Vegas, when we’re not enjoying its excesses, know that many of the prominent Sin City casinos no longer rely upon gambling revenue to turn a profit from year to year. It’s well known that with increasing competition nationwide for the gambling dollar, Vegas casinos need to make money many different ways in order to turn a profit.

Two interesting casino developments of the past month have made me wonder if we’re at the point where it’s hard to make meaningful money off of gambling.

When Lucky Dragon closed its casino, (temporarily, it is claimed,) it was seen as a failure for a variety of reasons. The Dragon had opened its brand new, shiny, boutique casino/hotel barely a year earlier, and its casino traffic has been so bad that it could no longer afford to offer gaming.

The reasons most touted: The location was horrible, the gaming was unspectacular and the enticements were missing.

I’d agree.

The location makes Lucky Dragon a tough sell right now, and for the foreseeable future. It’s just off the strip, on the north end, where there’s little of excitement. Yeah, it’s close to the Stratosphere, but it’s a destination casino that doesn’t have the benefit of foot traffic like you would get at Cromwell or Casino Royale. If you want people to go out of their way to visit your boutique hotel, you had better give them something worth going out of their way for.

The fact that the property was designed to target Asian gamblers didn’t seem to help.

And it’s that gambling demographic that resulted in the mix of gaming offered by the casino. I have never set foot in the place, but it was touted as having appeal to the Asian gamblers of the world because it featured plenty of baccarat, and put less emphasis on other table games. Space is limited, and you can’t offer everything for everybody, but you need to have a niche if you’re going to put asses in the seats, especially when you don’t have 1,000+ hotel rooms feeding into your casino floor. And baccarat wasn’t the right niche, evidently.

I never paid much attention to any promotions or enticements that the Dragon was offering, but I never heard much talk about them, either. There were some simple free play or match play promotions, but if you want people to play your games in a casino that’s not convenient, and not in the most glamourous part of the city, give them some incentive, like a lower house edge. Perhaps single-zero roulette wouldn’t have made much of a difference, but offer low-minimum tables with a single zero and you’ll be the talk of the town. If couldn’t have made things worse, could it?

Better promotions and gaming odds would have drawn more people to the casino, but perhaps it wouldn’t have been enough. Perhaps the small casino/hotel couldn’t afford the volatility that a lower house edge exposes. (There’s evidence to suggest that.)

Wouldn’t it have been nice to know?

The one thing the Dragon couldn’t change is its location. Its out-of-the-way location is seen as a major detriment to its success. For any small casino to succeed in that location, it had better attract a significant percentage of its target market, or draw a lot of people looking for an alternative to the stinginess of the big players on the strip. And those people exist, without a doubt.

So, with or without more favorable gambling conditions for the player, if you could just plop the Dragon in a more prominent location near the heart of the strip, it would have a fighting chance of succeeding, right?

Not so fast.

This month has also included the closing of the Westin Las Vegas casino. All gambling was removed from the property, making way for a new restaurant, and meeting space, or something like that.

Yeah, that’s what’s missing, a restaurant in a hotel three minutes from the hustle and bustle of the strip.

The spin seems to be that this is some sort of evolution, some sort of plan, that phasing out gambling was a good thing. The latter seems to be true, but I’m skeptical its demise is by design.

When I first went to Vegas 21 years ago, my first day in town brought me to a cheap, if not free, afternoon magic show at the Maxim. The Maxim was a modest casino/hotel just off the strip, tiny in comparison to MGM, where I stayed on that first trip.

The Maxim had a bustling crowd that Thursday afternoon in early January. Who would have guessed that it was 21 years away from disappearing? Not me.

The Maxim eventually became the Westin. I’m not sure whose guidance drove off the gambling crowd, but I was in that joint a decade ago, after the Maxim name was scrubbed from the property.

I have no special insight. I don’t know why the gambling crowd deserted the property. Was it because it was poorly run, and people stopped coming, or did people stop coming because of the fickle nature of business, and the property failed to react.

A vibrant casino, just a couple of minutes from the heart of the strip, could no longer make a go of it. Is the competition from the major strip casinos too difficult to overcome? Perhaps, but close to the former Maxim is a smaller, less spectacular property known as Ellis Island. It is doing better than ever, despite having less to work with. Its casino isn’t going anywhere any time soon.

Moral of the story: Location is important, and gambling is a tougher business than ever. It remains a viable business for the smaller, secondary casinos in Vegas, but it’s tougher than ever to succeed, and is far from foolproof. We lost the Maxim, and Lucky Dragon is dying on the vine. Casino properties in the tourist districts had better offer a lot of things for a lot of people, or they face a tough battle for survival.