Harrah’s Entertainment continues construction progress on $1 billion Caesars Palace NV hotel. Even though last quarter’s loss was almost $100 million, they continue with their expansion of convention space and a new hotel casino tower.
In the past month other hotel chains have reported they are halting expansion including Echelon resort, a $5 billion version of New York’s Plaza Hotel. Crown Las Vegas and Morgan’s Hotel Group. Last year’s net profit during the same quarter was $237.5 million. Revenues for Harrah’s during the second quarter declined year to date 3.7 percent or $2.6 billion.
Seven months ago the Las Vegas hotel and gaming company became private by purchase of private equity firms Texas Pacific Group and Apollo Management Group for $17.3 billion and debt of $12.4 billion. The higher debt was due to their doubled interest expenditures to $468 million.
The current national economic conditions, credit market and slowed Las Vegas economy has contributed to the company’s loss with their three dozen casinos in a dozen states.
The Caesars Palace expansion is integral to the continued success of the gaming company and the Las Vegas real estate market. Encore resort by Wynn will open soon along with planned over $9 billion Project CityCenter on the Strip.
The company continues to rebrand and invest in its US gaming properties. Harrah’s rebranded Grand Tunica hotel to Harrah’s Casino Tunica and Caesars Indiana to Horseshoe Southern Indiana. Harrah’s completed a $565 million expansion of Harrah’s Atlantic City.