Tuesday, August 22, 2006

If you've driven down the Strip anytime in the past few years, you know how
bad traffic is. Now imagine yourself creeping along past one construction
site after another trying to get to a restaurant on time with an additional
50,000 cars crowding the already jammed-up Las Vegas Boulevard every day.
It's going to happen. And it's going to be even worse than that. The
Regional Transportation Commission is projecting that, without major changes
in transportation systems, seven Strip hotel-casino projects already started
or planned to be built in the next four years -- the Cosmopolitan, Echelon
Place, Encore, Palazzo, Project CityCenter, Signature and the first Trump
tower -- will boost daily traffic along the resort corridor by 25 percent.
The resort corridor, which includes Las Vegas Boulevard, Interstate 15,
Paradise Road, Frank Sinatra Drive and Industrial Road, already carries
about 225,000 vehicles per day, the agency said. All those trips include
drive-in visitors, taxis, rental cars, and cars driven by Strip workers and
local residents, the agency added. "It will be very difficult to meet the
demands for all those new cars," Regional Transportation Commission General
Manager Jacob Snow said. The traffic snarls will be much worse if all of the
80,000 hotel and condominium rooms that have been proposed along the Strip
corridor are built.
The RTC projections for the seven Strip projects expected to be built in the
next four years are based on its estimates that each new hotel and condo
room will increase traffic along the Strip corridor by about two trips per
day, meaning the projects' 23,000 proposed rooms would add 53,670 cars each
day.

But another 74,000 condo units have been proposed or are under construction
along the Strip, and, using the RTC estimate of about 2.3 new cars per room,
traffic could increase by another 100,000 or more vehicles each day along
the corridor if all those condos are built.

That could mean that traffic on Las Vegas Boulevard, which is already
maxed-out at 50,000 vehicles per day, could more than triple.

And tourists are already complaining.

For example, one gaming analyst who asked not to be identified and who
visits Las Vegas frequently, said a taxi ride from the Four Seasons Hotel at
the south end of the Strip to Wynn Las Vegas takes longer than the one from
Battery Park to Central Park in New York City, even though the local trip is
half the distance: 2.7 miles vs. 5.3 miles.

"That's a real problem for businessmen and convention-goers and a pretty
unpleasant surprise for leisure travelers," he said. "Just picture it
getting that much worse."

Jim Medick, head of MRC Group Research Institute, a market research firm,
agrees and said those kind of surprises will have a major impact on whether
or not leisure and business travelers pick Las Vegas over other
destinations.

His surveys already suggest that problems getting to and from major
conventions are one of the biggest concerns for business travelers.

Additional traffic and construction delays will only discourage more
visitors from making return trips until the problems are resolved, he said.

Before such a Doomsday scenario comes to pass, however, something has to
give, said Greg Borgel, owner of consulting firm Moreno and Associates.

"The numbers are accurate," he said of the RTC's predictions. "But that
number of vehicles simply couldn't be sustained. There is no possibility of
broadening the Strip to 20 lanes and that, among other things, is what you'd
have to be talking about."

University of Nevada, Las Vegas, professor Bill Thompson, who specializes in
gaming studies, ranks the Strip as one of the world's greatest pedestrian
malls and said it warrants special attention.

"I'd suggest that the number one tourist activity in the number one tourist
city in the world, Las Vegas, is walking and gawking on the Strip," he said.

MRC's research backs him up. Medick said his surveys have consistently found
that, depending on the season, walking the Strip is a leading recreational
activity for visitors with most tourists walking to seven or more casinos on
each trip.

Because of that, Thompson and Snow agree that government and industry
officials need to put a greater emphasis on pedestrian and people flows to
relieve traffic congestion along the Strip corridor.

"Any destination that has grown as rapidly as we have, and continues to
grow, needs to look at (these) issues, whether it's transportation or
highways into Las Vegas, or its air capacity," agreed Las Vegas Convention
and Visitors Authority President Rossi Ralenkotter.

Ralenkotter also believes the multibillion-dollar investments that
hotel-casino operators are making to Manhattanize the Strip show they
believe the challenges can be met, too.

David G. Schwartz, director of the Center for Gaming Research at the
University of Nevada, doubts that traffic problems will become serious
enough to hurt Strip tourism because many visitors to Las Vegas already face
worse traffic congestion in their own hometowns.

Comments from some recent visitors suggest otherwise, though.

Vicki Park, who was visiting from Chicago in July, for example, complained
about her half-hour midday taxi ride from Fashion Show mall to MGM Grand.

"Look, that's the kind of problem I come here to escape. Change the formula
and I stay away," she said. "It's not that the stores here are that much
better, it's that they are that much more convenient."

Park said if traffic problems in Las Vegas get much worse she may decide to
do her shopping at home or to vacation elsewhere.

Similarly, Marcy Matheson from Washington said she missed the beginning of
"Love," the new Beatles show at The Mirage, because of the unexpected time
it took to take a cab from Mandalay Bay.

"I don't need the headache. I might as well stay home if they're just going
to turn this into another Manhattan in terms of crazy traffic," she said.
"That's not what I'm looking for on vacation."

But another Manhattan is exactly what gaming companies and developers have
said they foresee as the Strip's future.

Skyrocketing Strip land prices make high-rise, mixed-use developments like
MGM Mirage's Project CityCenter and New York developer Bruce Eichner's
2,200-room Cosmopolitan necessary for the future growth of Las Vegas'
tourism and gaming industry. Industry leaders such as MGM Mirage boss Terry
Lanni and Eichner acknowledge that their projects will create more traffic
snarls. But they argue that, partially because of the traffic, future guests
will spend more of their time at the "urban center" resort they are staying
at and less time visiting other resorts.

But local officials and developers are taking steps to accommodate visitors
who want to wander outside.

The RTC's Snow notes that some traffic improvements have already been
completed, although he conceded that even the newest projects such as Frank
Sinatra are already inundated with traffic and much more needs to be done.

"What we need are the financial resources first," he said.

Borgel, the consultant, said the Strip resorts can help generate the revenue
needed to make traffic improvements.

"If the monies generated on the Strip from the various sources are not used
to finance transportation, then people will face unacceptable transit
problems," he said. "But that is not the history we have had in Nevada. The
premise that we won't provide the enhancements on the Strip (is false). We
will as we always have."

UNLV's Schwartz said he is also confident that developers will be able to
mitigate traffic problems by working with the state and county on
improvements.

That is already happening with the already announced mixed-use projects.

MGM Mirage spokesman Gordon Absher said traffic and pedestrian mobility were
"top of mind" in planning the $7 billion, 2,800-room Project CityCenter. The
first challenge for Ehrenkrantz Eckstut & Kuhn Architects, Project
CityCenter's lead architect, was to analyze traffic flows in Las Vegas to
produce a design that minimized disruptions.

The project will include an elevated Harmon Place roundabout that will
create a new above-ground level for transit. The level will give drivers
off-Strip access to two of Project CityCenter's major structures.

Borgel, who has worked as a consultant to The Venetian on its Palazzo
expansion, said Las Vegas Sands Corp. has built pedestrian overpasses and
has paid to install right-turn lanes and resynchronize traffic lights around
the expansion. Also, he said, Las Vegas Sands is building all of its visitor
and employee parking structures on the Palazzo's backside with access
through Koval Lane.

"Just like MGM Mirage's CityCenter, that helps the Strip by putting access
and parking off the Strip," he said.

MGM Mirage also owns the 1,728-room Signature tower at MGM Grand.

Doug Williams, chief development officer for the Cosmopolitan, said easing
potential traffic problems is a priority for his $1.2 billion project.

"To mitigate potential traffic issues, we're putting our main entrance and
porte-cochere on Harmon Avenue rather than Las Vegas Boulevard," he said.
"And we'll dedicate land for an additional right-hand turn lane into our
main entrance to our main entrance on Harmon Avenue.

"In addition, we are working in partnership with CityCenter to fund and
build two pedestrian bridges, one across Harmon and the other across Las
Vegas Boulevard."

Rob Stillwell, spokesman for Boyd Gaming Corp., which has announced plans
for the $4 billion, 2,000-room Encore high-density urban resort project at
the Strip's north end, said it is premature to discuss his company's traffic
plans.

However, he said the company will consider donating some land on Encore's
Strip side to the county if it will help mitigate traffic congestion.

Encore developer Wynn Resorts Ltd. and Trump developer Donald Trump did not
return phone calls or e-mail messages about what traffic-easing steps they
may take or favor.

Donald Trump is building a 1,282-unit condo tower and Wynn Resorts is
building the 2,000-room Encore.

Harrah's Entertainment is devising plans to redevelop its properties on the
Strip's east side around Flamingo Road. But Harrah's spokesman David Strow
said he couldn't comment on rumors or speculation.

Snow and others agree that it is in the developers' and casino companies'
own interests to take steps to help local and state governments alleviate
traffic problems along the Strip corridor.

"When you start getting the type of development density we'll get on the
Strip and look at all the cities in the world with the same density, the
successful ones have created world-class transportation systems," Snow said.

Otherwise, he warns, "if it becomes a problem, it will start to affect the
bottom line of all the operators."