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MGM Resorts International Message Board

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  • bear_cubster bear_cubster Nov 13, 2008 6:49 PM Flag

    MGM CityCenter - Perfect Storm

    Despite the economy, there are plenty of very wealthy people out there (CEO's, doctors, attorneys, celebrities, athletes) who would be eager to snap these up so I don't think it will be an issue. I live in Orlando, but heck if I had the money and a job in Vegas I would buy one, they are awesome and right on the Vegas strip. If you have the $$$, you can wake up on the weekend to a great view, then roll out of bed for a bite to eat in a 5-star restaurant then stroll on over and watch the game on a 200 mega foot screen TV then play a little bit while getting free drinks all without leaving the building! Its like places in Manhattan, the economy can suck eggs and they will still sell for millions. With the real estate market in the toliet these are probably a steal right now.

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    • The reason the CEO's and doctors etc. have money is because they don't overpay for properties like this. When CityCenter was launched in 2005, things were much different. They want about $1500 per suare foot for these units while the market will bear no more then $800 psf.

      These units are not for the locals. They are for investors/flippers who want to make money.

      By now most people looking to invest in condo/hotel units realize there's no money to be made. The high fees that the MGM charges to manage the properties leaves the investor with about 25% of the revenue from rental. After paying mortgage/insurance/electric/taxes on these units, an investor loses quite a bit of money every month.

      Look at it this way... If they close on 25% of the properties, those investors would most likely try and flip the properties for a profit. If there are no takers then they will start dropping the price. If CityCenter doesn't drop the price of the unsold units to be inline with those being sold by the flippers, they can't compete. All of the investors need to get out of the way before CityCenter can sell anything. MGM needs to sell almost ALL of the units before they start closing or they will be left hold the bag.

      This could be ugly.

 
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