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8 ANALYSIS Viva Las Vegas

The development of world-class shopping malls has been a major plank of Las Vegas’ plan to widen its appeal from the old ‘Sin City’ clientele. But now that the city is the grip of a major downturn how is the strategy working?

During the first decade of the new millennium Las Vegas was the fastest- growing city in the US, with its population growing by 20 per cent from 478,434 to 583,756. But the economic boom that drew so many hopefuls from across the US, and indeed from across the world, to seek a new life in the Mojave Desert hit the buffers.

It is a symbol of the shattered dreams

of many that the city now has one of the highest home foreclosure rates in the country. Unemployment stands at 14 per cent against a US average of 9 per cent, and that in a country that lacks the social safety net that Europeans enjoy.

in 2007 at 39.2m, and by 2009 they had slumped to 36.3m before recovering in 2010 slightly to 37.3m. But at that level they are still running below 2004’s levels. So what does this mean for the city’s shopping malls? Recent years have seen the construction of four major shopping malls on the Strip – Miracle Mile; The Forum Shops at Caesars Palace; the Grand Canal Shoppes at the Venetian and the Fashion Show Mall – with two Premium Outlet properties bookending the Strip to the north and south. Remarkably, they are holding up well and

that’s down in part to a shift in the nature of visits to Las Vegas. It’s the hardcore gamblers and the visitors to corporate conventions

Forum Shops at Caesars Palace, this is good news, because the average tourist visitor has three times the disposable income of a local shopper. The 636,000-sq ft Forum Shops is ranked

by ICSC as the most productive mall in the US, with the highest sales densities of any US centre. Yet it has no anchor department store and its layout is idiosyncratic, basically leading to a dead-end. So why does it perform so well? Crampton

says the art has been to turn the mall itself into an attraction, with its signature statues and spiral escalators. And it’s closely integrated with the Caesar’s Palace resort and casino. “We consider Caesars to be our anchor,” she says, “But there’s cross-fertilisation. We’re each driving traffic both ways.” Early indications are that the good times

are back at The Forum Shops, with the first two months of 2011 seeing double-digit year- on-year increases in footfall meaning traffic is now up on the previous record years of 2007/8. According to Crampton this not only reflects a bounceback in visitor numbers to Vegas as a whole, but it specifically relates to work Simon has done on the mall. A new extension has created a prominent

entrance on the Strip, and in addition it has created a three-storey trading space that has proved attractive to some interesting new brands like Mark Jacobs, Harry Winston, Ted Baker, Agent Provocateur, Ugg and Californian favourite Chrome Hearts. “Some major new brands like Gucci,

The Las Vegas economy was predicated

on a belief that the leisure industry – the casinos, hotels, restaurants and bars that line the Strip – would continue to grow exponentially. And construction was a major source of employment building homes for the new arrivals as well as new resort casinos like the massive City Center complex. But data from the Las Vegas Convention

and Visitors Authority shows that this was a false assumption. Visits to Vegas peaked


that have stayed away during the downturn. Leisure visitor numbers have proved far more robust, and that is the group that is most prone to go shopping while in Vegas. According to the Las Vegas Convention

and Visitors Authority 2010 was the first time that more than half of visitors described the primary purpose of their visit as “vacation or pleasure.” According to Maureen Crampton, Simon Property Group’s marketing director at the

Versace and Burberry took the opportunity to upsize last year,” she adds. And the biggest vote of confidence came in December 2010 when H&M opened its biggest store anywhere in the world in the 60,000-sq ft space formerly occupied by the toy store FAO Schwartz. At the same time Tournel has also just

opened the world’s biggest watch store, specialising in luxury brands to appeal to the high rollers. And for Crampton these two openings epitomise the breadth of the Forum Shops’ offer. “We can appeal to the masses as well as the high end,” she says. Since it opened 20 years ago The Forum

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