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Las Vegas Casino in Financial Trouble

The Riviera Hotel and Casino is a Vegas Strip casino that offers just what you’d expect. They have a Chinese acrobatics show, a topless revue, a comedy club, a comedic hypnotist, and a duo that performs a tribute concert to Barbara Streisand and Frank Sinatra. They offer a full convention center for businesses interested in holding conventions. Of course, they have a full casino with poker, table games, slots, video poker, and a race and sports book.

Unfortunately, their holdings company, the Riviera Holdings Corp, has filed Chapter 11 bankruptcy. According to the casino operator, the recession has hit the casino too hard for them to continue paying their loans, and Riviera Holdings Corp. has defaulted on over $225 million in loans from Wachovia Bank. The terms of the bankruptcy will transfer the properties to the lenders, which means that for now, both the Riviera Hotel and Casino and its sister operation the Riviera Black Hawk Casino in Colorado will be able to continue operating.

The news, though far from shocking, is a bad sign for the land-based casino world. Even with the UIGEA in place, more and more bettors are placing their wagers online. Moreover, state after state is opening or expanding their casinos making Las Vegas much less of a casino destination than it used to be. The current downturn in the economy means that more Americans are doing without vacations, staying closer to home, and spending less money when they do vacation. For Californians who used to drive to Las Vegas for a weekend, economic hardship coupled with rising gasoline prices have made the trip much less appealing.

The trend is likely to get worse before it gets better. Casinos around the United States are feeling the pinch. The only ones profiting are the online casinos. If the government doesn’t move to allow America’s land-based casinos to offer online games, they simply won’t be able to continue operating, meaning lost revenues from taxes, lost jobs for those employed by the casinos, and the end of an era for Las Vegas.

The Las Vegas Strip casinos are working hard to bring in more customers and keep them at the tables longer, but the reality is that fewer tourists are even making it into Las Vegas these days. Those who do want to play for lower stakes, and those who do play higher stakes are often those who can ill afford the losses, meaning the casinos are often forced to turn down their credit cards and send them on their way.

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