Tropicana: omen or sore thumb?

The economic slowdown is the No. 1 topic in Las Vegas now in conversation and in media. The Tropicana filed for bankruptcy. While the drop in tourists may be blamed, I have reported on the Buffet about the problem-plagued property for some time.

The last time a major casino declared bankruptcy on the Strip was the Aladdin in 2001. In that case, the post-9/11 environment was cited as well as it being a resort with a Middle Eastern theme. I always hated the insinuation that somehow racism was at fault for Aladdin's failure.

The Aladdin had so many design problems when it reopened that Planet Hollywood is still spending millions to fix the place. And I am being generous by not dwelling on management decisions before Aladdin filed for bankruptcy protection. In short, the Aladdin's bankruptcy may have been accelerated by the economic downturn in Vegas after Sept. 11, 2001, but one felt that the process of the resort's fall was well underway before terrorists attacked New York. And it is meaningful that no other casino went bankrupt during that period.

Similarly, the Tropicana's problems date back to a bidding war that the new owner won, but at what most experts felt was a grossly inflated price. Problems continued through workforce reductions and continue at the Tropicana to this day as the resort is the only one on the Strip that has yet to renew its contract with the Culinary Union.

These are certainly hard times for Vegas. Among the casino companies to announce layoffs are MGM-Mirage and local giant Station Casinos. Only Steve Wynn has announced that his property will have no workforce reductions. Meanwhile, huge new resort projects like Cosmopolitan are haunted by uncertainty; Donald Trump has put off building his second condo/hotel tower; and the Plaza resort that was to replace the New Frontier also may not break ground anytime soon. There is also the problem of the residential mortgage crisis that is taking place in the suburbs outside the scope of this blog.

Much has changed since a few years ago, when even Trump's former wife had the towering Ivana planned for luxury Vegas living. That said, Palazzo at the Venetian has just opened. Encore at the Wynn is about to open. CityCenter by MGM is coming along with incredible alacrity, as is the little-discussed Fontainebleau resort. In entertainment, big projects like "Jersey Boys" at Palazzo and Cher at Caesars Palace are opening at a regular clip, including Cirque's plan to invest $100 million into a Criss Angel show later this year.

The Tropicana can certainly blame the economic slowdown in Vegas in part for its bankruptcy.  But plenty is still happening at other companies on the Strip. And, while there may be sales, I doubt any other Strip properties will need to resort to bankruptcy.

By the way, the Trop continues to have one of the best locations on the Strip: next to MGM Grand and New York New York, with easy access to Luxor-Excalibur-Mandalay Bay.

(Photo by Sarah Gerke)