Las Vegas: Foreclosures Hit Resorts and Casinos

(MoneyWatch)  Las Vegas was once known as the home foreclosure capital of the country, but now its commercial and retail districts are becoming bank-owned. So far, Las Vegas is leading the nation in commercial forclosures. According to the Las Vegas Sun, the numbers pan out like this:

• $4.48 billion in land.
• $2.4 billion in hotels.
• $1.6 billion in retail with 5.4 million square feet.
• $830 million in apartments with 7,374 units.
• $177 million in offices with 678,377 square feet.
• $43 million in industrial with 258,819 square feet.
• $27 million in "other" properties.

Recent bank-owned properties include the nearly 3,000-unit Cosmopolitan Resort Casino on the Strip and Loews Lake Las Vegas. As we know, the recession hit the gambling mecca harder than most areas of the country. With tourism jobs on the decline, Nevada's unemployment rate rose to 11.3 percent in May, the highest number since 1976. As if to illustrate the situation, this week 4,000 people showed up for 800 job openings at the Hard Rock Hotel and Casino. (At least that hotel and casino seems to be fiscally OK. That can't be said for several other resort casinos on the Strip.)

The hotel and commercial property foreclosures are just starting to gain momentum. I expect several more resorts and casinos, either being built or already completed, will be taken over by lenders within the next 12 months.