The battle between Barcelona and Madrid is over. No, not a match between their excellent football teams, but over the location of EuroVegas, the visionary development conceived by Las Vegas Sands Chairman Sheldon Adelson.
The capital of Spain and the country’s largest city, Madrid won the competition by being more aggressive, says Adelson.
“The regional government of Madrid has been a strong advocate for this potential development, and we are appreciative of the energy they have brought to this process,” he said. “Barcelona is an outstanding tourism destination, and choosing Madrid over Barcelona was not an easy selection.”
LVS plans to invest up to $22 billion in the project, which has a total cost of more than $65 billion. Adelson made it clear that LVS would own no more than 35 percent of the project and expected other investors to be closely involved. He’s asking the Spanish government to change national law to allow smoking inside the casinos and change zoning restrictions to allow taller buildings, but some experts doubt that would happen. How Adelson would respond to a denial on these points is unknown.
A specific location has not yet been chosen, but it must include space for 12 hotels with 36,000 hotel rooms, a convention center, three golf courses, shopping areas and a myriad of food and beverage outlets. If this is indeed the size of the development—LVS said size and scope are still being determined—it would exceed the Sands China Macau project, which includes five hotels, three casinos, retail, entertainment, dining and convention and meeting space.
The ability of Las Vegas Sands to raise the balance of the investment is being questioned in some quarters. Ramon Zarate of the EMASI group said it would be difficult.
“I see capitalization by banks as being very complicated,” he said, suggesting LVS would need to “pool” investments from a collection of venture capitalists.
Even Las Vegas Sands expressed some concern about the “current economic challenges” in Europe.
Opposition groups are up in arms about the LVS project. “EuroVegas No Platform” conducted a protest in Madrid days after the announcement, just a hint of what could come.