REI Neon’s big move in the game for its Major Las Vegas Sports Arena
Well the big sports area in Las Vegas City may have just grown wheels under it. What has developed is not surprising, its just typical big business.
The players include the little guys that own property south and west of Charleston and Main Street. They all got dollar signs in their eyes like little girls looking at pop idols dreaming that they would get rich quick by selling their property from 3 to 4 times its real value.
Then we have the City of Las Vegas trying anything to extend “The Strip” further in to the “Fremont Street Experience” where their City Casinos (Cash Cows) have not been doing well. Most people do not know that the only major Casino located in the City that is on the Strip is Stratosphere. All other Strip Casinos are located in the county and do not contribute tax dollars to Las Vegas City.
The third big leg to this stool is REI Group who proposed this Mega development to include a Sports Arena, Casino and Hotel. They have recently announced a new partner in the development “The Cordish Co.” More on that in a minute.
Now if you have been reading my writings for a while you know that Stratosphere sold to Goldman Sachs and that the sale included 10 acres of develop-able ground. I told you Sachs had not indicated any expansion plans to date. Well I think that just may have changed now. They have made no announcement but it appears the new sports arena may have grown trailer wheels and moved south to snuggle up with Stratosphere.
It seems REI’s new partner The Cordish group has close ties to Goldman Sachs. With the current tight development financing it may be tough to get a huge project done right now but what if you could drop the hotel and casino and just build the stadium which would take fare less land and still provide the needed support for a new Sports Arena. And by doing so you don’t have to pay 40+ land owners ridiculous prices for their land. Wow, that may just pencil.
Yep, My guess is that Goldman Sachs and REI have know about this since Goldman initiated the deal to buy the Stratosphere. I have seen very few deals go through by assembling 40+ land owners to make a project. The problems are impossible as some owners will always blackmail and sabotage the project. So it appears the all those land owners can find buyers on their own to pay them the big bucks because it appears the party for the Sports arena just started and its at the Stratosphere.
The moral to this little tail is that if the 40+ owners really want to do a deal then they better get organized. They better get their prices in line and form a joint land owners group under which their land is contractually packaged and they own shares in. Then they have a bargaining tool. I am not suggesting that the Sports Arena will come back on their site. But with the Strip land being all sold off they could hold the site for the next major casino project in Las Vegas.
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