Two Way Hard Three | Las Vegas Casino & Design Blog

February 22, 2008 6:05 AM Posted by detroit1051

I'm listening to the podcast in segments. I started with David McKee's comments on my old hometown, Detroit. I held my breath until I realized he had some positive things to say. MGM will have a home run in Detroit; a first class property with its location on the edge of downtown, not far from the Cobo Convention Center. Metro Detroit's population of 4.5 million residents provides a huge market for the three commercial casinos. MGM has done the best job of the three in giving people reasons to drive downtown. It's unfortunate that MGM Grand Detroit's opening was in the midst of a severe recession, if not depression, in Southeast Michigan. I have heard reports that the hotel, with only 400 rooms, has low occupancy rates except when there are conventions in town. Michael Mina's two signature restaurants, SaltWater and Bourbon Steak will have to depend heavily on business travelers because of their price points. I've dined at both, and SaltWater is exceptional, but like at many casinos, especially in the midwest, steak houses are the bigger draw. I hope MGM is patient enough to let SaltWater develop its clientele over time. It is one of the best restaurants in the state. David, I don't know whether you went into Wolfgang Puck's, but the bar area at the very rear of the restaurant is a very comfortable place to dine and have conversations.
David's comment that Greektown Casino looks like something that Stanley Ho would operate was an excellent analogy. Right on the money. Greektown has consistently run a poor third in revenues, and the expansion project does not appear to be progressing smoothly.
Privately held MotorCity Casino may have a tougher time than MGM due to its poor location in a desolate area several miles outside of downtown. However, I wouldn't count it out becasue of the excellent management provided by Marian Ilitch. The Ilitch family has done a great deal for Detroit thanks to the Little Caesars Pizza empire. Marian's husband, Mike, owns the Detroit Tigers and Red Wings and has invested hundreds of millions into Detroit. Because of his sports team ownership, he has no interest in the casino operation. No offense to Mike Ilitch, but I've always said Marian was the brains of the family.
The three casinos had to agree to build hotels to be licensed, and further, once the hotels open, the tax rate declines. So, even if MGM sometimes thinks it overbuilt in Detroit, the lower gaming tax rate makes it worthwhile.
Across the river, in Windsor, Casino Windsor, now renamed Caesars Windsor, is in the midst of a large expansion. I'm sure the private equity guys are wondering that they got themselves into. Metro Detroiters used to provide about 80% of the business at Windsor, but that was before the falling dollar, unpredictable border delays since 9/11 and the most impactful of all, the non-smoking laws in Canada. It's a nice property, but it sure has some challenges. I don't know the financial implications for Harrah's because it operates the casino for the Province of Ontario.
This segment of the podcast was great. I'll catch up with the rest over the weekend.

February 22, 2008 8:53 AM Posted by David McKee

Thanks, Detroit. Yes, I ate at Wolfgang Puck Grille and liked dinner so much I went back for breakfast. I was there during the auto show, so that may have swelled attendance, at least in the restaurants, a fair amount.

I was pretty impressed with the spa, too, but I have a very limited basis for comparison. The People Mover is everything the LV Monorail is not, including well-situated and affordable.

The older architecture in downtown Detroit is gorgeous and I took quite a few pictures. It's just unfortunate that it seems so deserted on the weekends.

February 23, 2008 6:47 PM Posted by KY

I enjoyed the comments about how insanely depresing Tropicana has gotten. I stopped in a few months ago just to see it, and it was worse than downtown or Casino Royale or Midwestern riverboats or anything else that is also soul-crushingly awful. I about sprinted across the street to MGM Grand.

February 24, 2008 9:15 AM Posted by Jeff in OKC

This is great stuff. Thanks to everyone who participates. The roundtable is a good mix, and interaction is top notch. I can't wait for the next one.
Regarding Columbia Sussex, I never get tired of seeing them get exposed, and probably won't until they leave Las Vegas. Of course, it makes great theatre while they're still around.

February 25, 2008 9:17 AM Posted by jshane

Here's link the "The Strip" podcast where Steve Friess interviews Steve Wynn. A question comes up when Steve Wynn is speaking to Steve Friess on the phone and Wynn is trying to get some business numbers. Wynn calls to get Victor Drai on the phone and they get Victor Drai in seconds.

http://media.podshow.com/media/261/episodes/80100/thestrip-80100-09-19-2007_pshow_186642.mp3

Wynn seems to be obsessed a bit with the nightclub Tao at Venetian compared to the other clubs - especially since the take at Pure is pretty phenomenal.

By the way I was fascinated by this second roundtable - great show. Thanks,

John

February 26, 2008 11:12 AM Posted by Jeff in OKC

I recall the this clip being Wynn responding to a Tao specific question from Friess. I think Tao had just announced that they were the highest grossing restaraunt in the U.S., or something to that effect, and Wynn was trying to split out the food and nightclub amounts from the gross listed. I thought Wynn was pretty complimentary to Tao during the exchange. I also thought the time to get Drai on the phone was compressed to keep the show moving.

March 3, 2008 8:23 PM Posted by Hunter

We are prepping for our next call.

I am creating my topic list for the group but I wanted to give you guys, the listeners, a chance to submit a topic or two for consideration. I can't promise we'll go into it but if you have something on your mind, post a comment here and I will consider it.

March 4, 2008 1:47 PM Posted by detroit1051

Hunter, regarding topics:
Your group has briefly talked about Echelon, but are there any more in-depth opinions on whether Boyd will succeed with the project? I know BYD successfully operates Borgata, but can it handle a CityCenter type project? Are the boutique hotels (Delano, Mondrian, Shangri-La) a good fit for the Strip?
Do group members know anything more about the interest in the LV Country Club property by a Middle Eastern investor(s)?
Just a couple of ideas.