Credit crunch cancels casino plan

Crown already owns three casinos in Las Vegas

Developers of a $5bn (£2.5bn) casino complex in Las Vegas have abandoned the project, blaming the credit crunch.

The complex was to have included a 5,000-room hotel and one of the tallest towers in the US at 324m high.

It was a joint venture between Australia's Crown, Texas developer Christopher Milam and private equity firm York Capital Management.

Crown, which is owned by billionaire James Packer, announced a strategic review of the project in February.

The conclusion of the review was that it would stop making payments to the site's owners and write off its investment.

"The recent upheavals in world credit markets have made it increasingly difficult for Crown and its partners to develop a commercially viable project on what remains an attractive location on the Las Vegas strip," Crown chief executive Rowen Craigie said.

The location on the former Wet 'n' Wild site at the northern end of the Las Vegas strip was put up for sale in March.

"It's indicative of the fact that in a slowing growth environment, the gaming sector does carry some short-term risk, given its exposure to discretionary spending," said Angus Gluskie from White Funds Management.