Insta-CoGo: What's in the Cards for Tropicana?
I recently wrote about the state of Atlantic City in this space (it ain't pretty), but now comes word that an entire chain of casinos is in trouble: Tropicana Entertainment LLC has filed for Chapter 11 bankruptcy protection.
The company says it will keep its properties open and staffing will remain level.
Troubles began for Tropicana when the New Jersey Casino Control Commission stripped the AC property of its license. According to the Associated Press report, "That touched off a funding crisis that the company desperately struggled to fend off until filing for protection in U.S. Bankruptcy Court in Delaware, listing assets of $2.8 billion and liabilities of $3.3 billion." The filing covers nine properties, including its Las Vegas casino; the AC property is in the process of being sold and is not part of the filing.
So what's going on? Clearly, we're wising up. With prices generally higher for everything, it makes perfect sense that casinos -- still a huge draw for travelers, don't get me wrong -- would feel the pinch. Add in the fact that a few airlines with a lot of service to Vegas have disappeared (Aloha and ATA among them), and you can almost see the money fleeing the city.
Newsweek has an interesting story on the fact that Vegas isn't recession-proof anymore. It makes an interesting point: One reason gaming revenues are down because there's so much more stuff to do. According to the piece, "Roughly 60 percent of the Las Vegas Strip's revenues now come from nongaming activities. By contrast, in 1991 and 1992, when the last comparable slowdown occurred, nongaming activities provided just 42 percent of overall revenue. 'This is different from prior downturns,' says Bill Lerner, a Deutsche Bank gaming-sector analyst. 'Now that there are a lot more nongaming amenities, the visitation mix is leaning toward nongamblers, and the consumer coming to Vegas is different now than it was.'"
So what does this mean in the general scheme of things? It could mean some great hotel deals this summer in Sin City -- and if you don't plan to sit in front of a slot machine, all the better. (Sites like Vegas.com are a good spot to look for bargains.) Heck, I love Vegas, just because it's a fun, easy place to chill (give me a buffet and a pool bar and I'm happy).
Now, if I can just get a good airfare . . .
By John Deiner |
May 6, 2008; 1:49 PM ET
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