A significant project
Red Rock Resorts has broken ground on a new $750m casino in Las Vegas. The gaming operator received the relevant permits from Clark County in January and has since begun the development of the Durango Station casino and hotel.
Red Rock Resorts chief financial officer Steve Cooley announced the beginning of the southwest Las Vegas project during a fourth-quarter earnings call on Wednesday.
over 2,000 slot machines and 46 table games
The project will require 18-24 months to finish with the resulting casino floor space spanning more than 70,000 square feet. This will include over 2,000 slot machines and 46 table games. It will also feature over 200 hotel rooms, as well as numerous restaurants, expansive meeting space, a spa, and a sportsbook.
The estimated $750m cost of the casino includes everything from construction expenses, financial costs, pre-opening expenses, and design costs. Red Rock has entered into a guaranteed-maximum price contract for the initial project phases. It is also looking to sell 23 acres of land behind the site of the casino for around $24m which will help fund the project.
Plans finally coming to fruition
Red Rock Resorts CFO Steve Cooley has expressed excitement over the new casino project. He has asserted that the casino’s location, in the fastest-growing area in the Las Vegas valley, provides a “very favorable demographic profile.”
Cooley added: “It’s a five-minute drive to approximately 125,000 people and no unrestricted gaming competitors within a five-mile radius of the project site.”
Red Rock has had plans to develop a casino on the site since its purchase in 2000. However, opposition from local residents and the recession led to a long delay. The operator made its plans for the property officially public in July last year.
A strong final quarter
Despite some “headwinds” in the fourth quarter, Red Rock Resorts still managed to reach all-time high adjusted earnings and margins.
lower visitor numbers compared to the previous quarter
Cooley outlined some of the issues presented in the quarter, including the continued Nevada mask mandate and inflationary pressure on regular goods and services. He believes these contributed to lower visitor numbers compared to the previous quarter. There was a strong level of spend-per-visit and time on devices across the company’s portfolio, however.
For the 2021 financial year, Red Rock generated net revenue of $1.6bn, representing a 37% year-on-year rise. Net income reached $354.8m, up from net loss of $174.5m the previous year. The fourth quarter accounted for $200m of net income.