Last week I was in Vegas for Blogworld and was struck by the inability of my fellow new media peers to see the collapsing city around them. While the practictioners of new media and citizen journalism were beating up on mainstrem media for missing the big stories they themselves seemed oblivious to to the state of Vegas. Today on of Yahoo’s most popular stories covers sin city’s turn for the worst.
Two factors make the current downturn harder for Las Vegas than previous ones, according to analysts.
One is high gasoline prices, which will hit the pockets of the more than half of Las Vegas visitors who drive in by car or bus. No one knows how $4-a-gallon gasoline will affect their spending decisions, said Margaret Holloway, senior credit officer at Moody’s Investors Service.
The other is the growth of places where gamblers can get a cheaper fix close to home, like riverboats in the U.S. Midwest and new casinos on Indian reservations like the MGM Grand at the Foxwoods casino in Connecticut.
The U.S. credit crisis has begun to dampen construction, a big economic driver since the 1990s.
Cranes have stalled at Boyd Gaming Corp’s (BYD.N) $4.8 billion partially built Echelon project as the company awaits financing agreements for two joint venture deals.
And the projection for new luxury hotel rooms to be built by 2010 is down by half from a year ago as the weak economy and credit constraints lead companies to reconsider their plans.