Recently, Red Rock Resorts has completed a series of big real estate buys in Las Vegas, while also consigning underperforming casinos to the wreckers’ ball. According to CEO Frank Fertitta, the measures are all part of a long-game strategy to “basically double” the Red Rock portfolio by 2030.
Insight into the Nevada-based casino giant’s plans came during its second quarter 2022 earnings call on Tuesday.
purchased 126 acres of land south of the Las Vegas Strip
Outlining plans for growth, Red Rocks chief financial officer, Steve Cootey, announced that the company has purchased 126 acres of land south of the Las Vegas Strip for $172m. He then also revealed the inking of a purchase agreement on a 67-acre gaming site earmarked for a casino resort in North Las Vegas.
Fertitta said the Station Casinos owner will “continue to roll out new properties one after the other.”
The family playbook
Red Rock’s aim to raise its next generation of casino properties in growing areas of the Las Vegas Valley is a classic move from the Fertitta family playbook.
“The way we’re going to do it is the way we built the company,” said Red Rock’s vice chairman Lorenzo Fertitta in the earnings call. He claims that the company has always focused on “the development of greenfield projects.” To ensure success, he said:
you have to control the real estate and have a pipeline for development.”
Cootey concurred, deeming the pair of recent buys another strategic step forward in the firm’s 46-year-long campaign of expanding its corporate empire. He summed up Red Rocks’ modus operandi as buying “gaming sites located in high-growth areas with superior ingress and egress among major beltways in the Las Vegas valley.”
Reassurance for locals
Station Casinos’ newly articulated plans are sure to reassure local casino-goers who may have feared the worst. Cootey has described the business as well placed to “capitalize on the very favorable long-term demographic trends and high barriers to entry that characterize the Las Vegas locals market.”
The reassurance comes just weeks after Red Rock announced plans to demolish Texas Station, Fiesta Rancho, and Fiesta Henderson, while also selling off the cleared land. Nevadans reacted to the news via Twitter, with many bemoaning the loss of once-treasured gaming meccas.
On Tuesday, however, Cootey defended the decision to pull the plug on “properties [that] have been an important part of our business for many years.” He deemed the decision “difficult” but “the correct one,” adding that the firm “was seeing an extraordinary amount of inbound calls” from parties interested in buying the properties.