Every year, the city of Las Vegas, Nevada, is always up and running with its casinos and nightlife. However, the COVID-19 pandemic in 2020 has brought this populous city to a standstill. Social distancing has led all gambling, entertainment, and dining establishments in Las Vegas to stay shut for the past couple of months. Come August, the Nevada state has implemented a reopening plan for Las Vegas businesses, which would bring things back to normal in a phased manner.
However, one of the popular casino establishments in the city, Station Casinos, has plans to shut their doors for good. According to the reports, Station Casinos in Las Vegas, Nevada is likely to keep four properties closed despite the reopening. Station Casino resorts are spanned across Las Vegas in prime locations. These properties are owned by Red Rock Resorts, the parent company to Station Casinos.
According to the CEO of Red Rock Resorts, Frank Fertitta III, the company is uncertain about the future of the four Station Casino properties, namely, Fiesta Henderson, Texas Station, Fiesta Rancho, and the Palms. These establishments are less likely to reopen during the COVID-19 as Fertitta believes “it’s too early” for the company to make the decision of resuming its operations at this time of the year.
As of March 2020, the Station Casinos had temporarily closed doors to over twenty of its properties across Southern Nevada. This move was aligned to the shutdown order issued by Steve Sisolak, the Governor of Nevada. The CFO of Red Rock Resorts, Stephen Cootey, is waiting to learn more from the data on how the casino markets in Las Vegas would respond after reopening. Currently, the data hints fewer chances of healthy demand at casinos and resorts, which is why these properties would not be reopening anytime soon.
The company’s decision to keep the doors to these Station Casino properties closed is going to be in the best interests of the stakeholders’ value. Due to the pandemic, the Station Casino revenues have dropped by more than 75% from the fourth quarter of 2019 to the second quarter of 2020. In the past few months, Red Rock Resorts has suffered more than $100 million in net loss. If all properties are reopened, and there isn’t a high footfall, the company could incur millions of dollars in further losses.