Taking a walk on the Las Vegas strip makes it clear that there is a problem. Being a veteran of Las Vegas, I have a pretty good idea of how many people should be crowding the casino floors and restaurants. It’s way empty in many of them.
New hotels like the Palazzo are practically giving away rooms while laying off employees. Older hotels are facing the very real possibility of going under. In a bad economy, it’s not a surprise that one of the first things cut might be gambling trips to Sin City.
Few can take advantage of the situation. Phil Ruffin is one of the few. Phil is not newbie to Las Vegas investing. He paid $167 million for the New Frontier back in 1998. 9 years later, he flipped that property for a nearly 10x return. Ruffin is also partnered up with Donald Trump on the Trump International Hotel and Tower. And now, Phil Ruffin has purchased Treasure Island from MGM Mirage.
MGM Mirage is in a tight spot with trying to wrap up their $9 billion super-project City Center. Considering the sweet location of Treasure Island on the strip, many think MGM could have gotten twice as much as the $500 million, but clearly MGM was not in a position to haggle.
Gaming Daily reported that Phil decided to check out Treasure Island first hand by dining in one of their restaurants. But it appears that the restaurant could not verify his reservation. I guess we know what will be overhauled first.
There is no word yet on what will become of the Treasure Island under Ruffin. We know that Phil wanted to replace the New Frontier with a jazz club themed resort called Montreux, but I can’t see him wanting to throw away a brand that still holds some value, like the Mirage. Hopefully we will at least see a nice remodeling.
For more info about Phil Ruffin, check out my post about Oleksandra Nikolayenko.