Renovation Is the Industry's Real Business
New builds get the photography. The archive's most repeated lesson is about what an owner can do without adding a square foot — and what happens to properties that wait.
Two sentences, twelve years apart, describe the same reflex. Hard Hit, in 2009: And those budget cuts impact new casinos, expansions and renovations.
All Things Being Equal, later: When the economy goes south, the first thing that gets cut are plans for new casinos, expansion and renovations.
What the archive then documents is the industry working out that the third item on that list should not have been cut with the first two — because a property that stops renovating stops competing, and the archive has a name for where that ends.
The cautionary tale has a name
The same 2011 editorial points at the reporting in that issue: judicious renovations, it says, can help properties avoid the fate of the Sahara.
A closed Las Vegas landmark is the reference point the whole argument rests on — deferred capital is not saved capital, it is postponed obsolescence.
What $50 million buys, and where to look for it
The archive's most useful renovation piece is blunt in its title: The $50 Million Budget: Real Renovation. The 2011 editorial introduces it with a deliberate understatement — showing what you can do with a paltry $50 million.
Its method is worth stating as a rule, because it is the opposite of how most briefs begin. Rather than asking what to refurbish, it asks what is not earning. Mike Stewart of YWS International: Typically opportunities exist in unused, non-revenue-generating space or space that can be adapted for another use once its primary use is closed, such as a race and sports book.
That is a survey of dead area, not a finishes schedule. It also explains why the same piece is the source for the boutique-within-a-casino move — a 400-slot, 10-table non-smoking room carved from existing floor. See the casino inside the casino.
The cheap end is not trivial
Suite Deal records a renovation whose credit line reads $250,000 — the smallest investment figure in the archive — and notes that at the El Cortez the renovations begun several years ago have made a huge difference for a reasonable investment.
It also records an unusual procurement: rather than appoint a designer for ten suites, Executive Manager Alex Epstein came up with a unique idea: hold a contest and let design firms and freelancers compete for the right to design and build the suites.
Small budgets license unconventional delivery, and the archive is full of that trade.
Where renovation money should not go
The clearest negative example is in Spurred to Success, on Oaklawn: It's only used 60 days a year, and it doesn't pay to spend a whole lot of money to renovate
— said of the grandstand, while finishes in the casino, however, had to be lustrous.
Utilisation, not condition, decides. A shabby space used sixty days a year is a lower priority than a merely dated space used every day, and the analysis that produces that ranking is the first hour of a renovation brief.
What the credit blocks show about renovation scope
Renovation figures in the archive carry more qualification than new-build figures, for a reason: scope boundaries are genuinely harder to draw. Beach Party prints $180 million*
with the footnote Cost is for entire renovation of Tropicana Las Vegas
— the story is about one venue, the number is about the whole property. The Glory of Rome gives its investment as part of an $860 million expansion programme.
Anyone benchmarking renovation cost per square foot against those numbers is benchmarking against something else entirely. See what a project cost includes.
The three things renovation can change, in order of cost
- Surfaces and light. Carpet, ceiling, lighting, signage. Cheapest, fastest, and — because the casino's identity lives in exactly those layers — disproportionately effective. Renovation Nation describes a tower where
the bones remained
and only the style changed. - Programme. Turning non-earning area into earning area, per the YWS method above. Moderate cost, largest revenue effect.
- Structure and envelope. Moving the building. Let It Rock, restoring plaster details and reopening
windows long covered
, sits here, and so does the $350 million price tag.
Most properties need the first, budget for the third, and under-invest in the second. That is the archive's argument, made across a dozen stories and two downturns.