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RETAIL Are Big Box Stores A Dying Breed? By Richard N. Velott asenior staff writer Bi THE RED BOX EFFECT g-box stores, the elephants of the suburban retail savanna, face growing threats to their survival. The evolution of technology, combined with society's growing comfort with buying online, are taking their toll. It's a national trend that is most notable in so-called "category-killer" segments like consumer electronics, and it's playing out in the Las Vegas Valley. As it does, commercial big Southern Nevada's real estate brokers are watching closely and adjusting their sales tactics. "The boxes that handle merchandise that is readily sold online, those are the ones that are in trouble," said Jeff Waddoups, professor at UNLV. In addition, an economics BROKEN MODEL?: A discarded shopping cart frames a Home Depot at the Arroyo Market Square . as products become smaller, many stores simply don't need as much floor space. Vinyl record albums, for example, are three to four times larger than a compact disc. And today, most consumers don't buy those, getting their music instead from online sources, which are loaded on devices many times smaller than the sound systems sold 10, 20 and 30 years ago. "I think the real problem with the big- GAMING DEBT-RATING AGENCY: PLAN FOR SAHARA IS RISKY FOR INVESTORS By Steve Greensenior staff writer S am Nazarian's plan to redevelop and reopen the Sahara is risky for investors in the project's debt, Standard & Poor's is cautioning. The debt-rating agency New York on April 5 issued a preliminary B-minus rating to a proposed $300 million term loan | 16 APRIL 2012 | for the $744 million project dubbed SLS Las Vegas that would open in the second quarter of 2014. Nazarian's company commenting on recent in 1,622 isn't ratings actions for the proposed project, a spokesman said after the report was released. SEE SAHARA PAGE 8 The number of rooms the Sahara plans to reopen, down from the 1,720 it had when it closed last May. Moody's and Standard & Poor's analysts agree that the Las Vegas tourism economy can absorb that many rooms, but S&P questions whether the Sahara's location is the right location. THE LAST DAY: Sam Nazarian, CEO of SBE Entertainment, which owns the Sahara, puts a note up on the hotel's door the day it closed last year. LEILA NAVIDI box store is that if you're going to get no service, you may as well buy it online," said Stephen Brown, director of UNLV's Center Development. Consumers have found like that the delivery of goods in online transactions is getting better, and because dominant online merchants Zappos.com The fact that Nevada has a fiber-optic infrastructure , great and shipping options, low tax rates and transportation SEE BIG BOXES PAGE 10 and its parent company, Amazon.com, have fulfillment centers purchases arrive quickly, in Nevada, sometimes for Business and Economic with shipment on the day of the order. Some see the potential economic development for local in the trend. a business-friendly attitude lends some hope that warehouses and fulfillment centers like Amazon's facility in Fernley could find homes in the big-box sites that commercial real estate brokers are ? LAS VEGAS Vegas then trying to market. The consumer electronics sector is where most of the big-box downsizing is occurring, and Southern Nevada has ? ? ? ? ! The innovator FortuneCookie NOW SERVIN 95 VEGASinc2021 Gate keep $ Grilled SAM MORRIS Technology is changing the landscape, says David Grant, senior vice president of the retail division of Colliers International in Las Vegas. He cited the Hollywood Video and Blockbuster chains, which had several outlets in Southern Nevada. Today, Hollywood is gone and Blockbuster has a fraction of the stores it once had. Consumers who rent videos go to a more convenient place to rent them — like Red Box vending machines — or they take delivery of their movies through the mail or with online downloads. "The Red Box model is so simple," he said. "You can rent a video at a McDonald's in the morning as you're going out of town, play it on a portable player on a plane and then drop if off at a Red Box machine in Chicago." Pick 'Em Get smart Power Lunch CLICK THIS For the complete story, go online to vegasinc.com. Buy high Sell low VEGASINCmag Executiv class The Numbers .com Power twe Sin City Me 7