Two major projects on Las Vegas Boulevard were put on hold in August, with both Boyd Gaming and Elad Group deciding to wait for the market to improve before moving further forward.

Work at the $4.8 billion Echelon was already under way when the announcement was made that the company would wait until 2009 to resume construction. Elad Group was projecting a late 2008 date to break ground on its $5 billion Plaza resort, but now says that, too, will be postponed until next year.

Analysts said Boyd Gaming didn’t have much choice in the matter, and following the announcement, investors who have been increasingly weary of the Las Vegas market showed support for the decision by driving up the company stock price by 20 percent.

Elad, which purchased the New Frontier from Phil Ruffin last year for $1.25 billion, also announced that it will defer payment on the $625 million loan is used to finance the purchase.

Both companies are committed to Las Vegas and their projects, but want to see the market improve before they pursue additional financing.

While they may be able to find better financing in a year if the credit market stabilizes, the cost of construction materials and labor are likely to be higher, too. As the cost of projects like CityCenter continue to climb, it will be worth watching to see what impact, if any, these delays will have on the total cost of these projects.

By Casino Connection Staff

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