Two Way Hard Three | Las Vegas Casino & Design Blog

November 8, 2010

Pascal To Charge Resort Fee For Refurbished Rooms Overlooking New Marquee... Or Something... What A Week.

Posted by Hunter

It's been quite a week in Vegas-land. Hard to imagine that less than a week ago, we were reading a WSJ story that validated pretty much everything I wrote back in September about CityCenter.

From there, we were off and into conference calls, some of which included a few interesting tidbits. MGM told us that both Bellagio and MGM Grand will be getting room refurbs next year, while Steve Wynn explained that their Cotai development work was wrapping up and they'd start moving dirt around any day. The best part of that call was The Steve's ludicrous assertion that they're not secretive about their hotel designs - he practically laughed the questioner off the call. We'll see detailed models and drawings of Wynn Cotai just as soon as some inept outside designer posts them online, not because the company was feeling generous.

Speaking of leaks, they continue at Aria, where we've learned that they're working on a massive new signage package to lure Cosmo visitors and that they're even considering building The Strip's largest marquee. I've got loads of new CC stuff to share with you as soon as I'm done digesting it all.

That brings us to today, with the only piece of news this week that really surprised me - Wynn Las Vegas superstar Andrew Pascal has decided to leave the company, to be replaced with the reliable Marilyn Winn Spiegel (someone we considered as a VPP guest before we settled on the excellent Tom McCartney). What is Andrew going to do next? He's a young man, I can't believe that he's ready to retire.

Pascal has worked for Wynn for a long time but before this current stint, he was in Silicon Valley as Chairman of WagerWorks, a company that provided online casino games, playable for points. Is he headed back to tech? Chuckmonster is betting on Icahn but I just can't imagine that sort of transition.

Ichan's not really in hospitality, he's in hospitality finance - moving money around from distressed property to distressed property, a far cry from actually serving guests. Nope, I think for Pascal I'd put my money on a few months time off and then into some new entrepreneurial venture of some kind - more likely Silicon Valley than Spring Valley though. Maybe Aunt Elaine has eyes on angel investing - we know she can afford it.

What's more interesting is Wynn hiring a veteran Harrah's exec for such a tough job. The last HET (or should I say CZR?) alum to have the gig, Don Marrandino, didn't even make it to opening day. Spiegel is well regarded but the properties she's overseen for Loveman have very different guest satisfaction aspirations. Hopefully we're not in for a rocky transition just as Las Vegas starts to ramp up again.

Interesting stuff... In other news, I've been thinking recently about re-calibrating this blog and it's content. The landscape has changed dramatically since I started doing this and in a world where my time is limited, I want to make sure I'm spending it to do something that matters, not just be the second, third or fourth site to post on the same topic. More on this as decisions are made.

One last thing - if you haven't already, maybe go ahead and nominate this blog and my app Vegas Mate for The Trippies - you have three days left before they close. Maybe, just maybe, I'll be so pleased with being nominated that I'll spill a bunch of new juicy secret details about everyone's favorite massively overpriced, failing joint venture project.

Cheers.


Categories: ARIA, Business of Gaming, Caesars/Harrah's, CityCenter, Cosmopolitan, Las Vegas Strip, Wynn Resorts


Comments

Read archived comments (22 so far)
November 8, 2010 7:48 PM Posted by mike_ch

Failing? I don't know, man. Daily take close to Bellagio isn't bad, is it?

The parts of CityCenter that aren't doing well are the parts that try to be drastically different than any other Vegas project. It's not that people aren't interested in modernist architecture or artworks or whatever, but the "different kind of customer" is simply not materializing at all.

The albatross is will always be Crystals until they give up and put stores in that someone who makes $60,000 a year will feel comfortable in instead of $90,000+ only.

November 8, 2010 8:18 PM Posted by detroit1051

I'm talking off the top of my head, but I think Andrew Pascal realized he will probably be never #1 at Wynn Resorts. Linda Chen may be the heir apparent. Also, it's possible Steve and Elaine's divorce may have caused Andrew to consider his future. He is Elaine's nephew. So, without any sound basis for predicting anything, I predict Andrew will go to MGM. Andrew has a marketing background, and prior to Wynn, he was in Silicon Valley. MGM has said repeatedly in investment presentations that it want to enhance database marketing:
http://www.bloomberg.com/apps/news?pid=conewsstory&tkr=MGM:US&sid=aafB_osvzaq0

It seems Andrew could assist in that effort, and if he knows what he's doing, he could become a star at MGM especially in getting Aria and CityCenter on track.

November 8, 2010 8:28 PM Posted by Hunter

Failing is a strong word and admittedly, I didn't put too much time into choosing it. It's probably too strong.

That said, many parts of their operation are WAY below Bellagio. Other than casino, it's typically 20%+ less than Bellagio and sometimes 50%.

Crystals is actually a better performer than Mandarin Oriental (losing money), Vdara (barely making money), Harmon (sitting there, waiting to fall over).

Crystals choice of retail may be off-putting to some but it's not the only issue... Bellagio has the same kind of retail mix and it's doing well.

November 8, 2010 8:31 PM Posted by Hunter

I seriously doubt MGM. It just doesn't add up in my book.

As long as Murren and Baldwin are there, there's no room for him. McBeath is doing the best that he can - what could Pascal do that McBeath can't? As long as MGM doesn't have the money to pump into CC/Aria, service will continue to languish, no matter who's steering the ship.

MGM seems content to just ride things out until the economy picks up and business improves.

November 8, 2010 8:31 PM Posted by John

Crystals an albatross? Thing is one of the monetary high points of the entire complex.

November 8, 2010 8:45 PM Posted by detroit1051

How happy is Baldwin at CityCenter, and how happy is MGM with him? He was Wynn's go to guy in the old days, but is Bobby still part of the A List?

November 8, 2010 8:49 PM Posted by Hunter

No one knows.

Clearly, he stayed on at MGM because he thought he'd have a chance at the top spot one day, something less likely with Wynn due to the man himself, plus others like Schorr and Pascal.

I could see Baldwin taking over if Murren was pushed out (though someone like Gamal Aziz might be more likely) but I could also see Baldwin being tagged with CityCenter's problems and being made a scapegoat.

November 8, 2010 11:34 PM Posted by joe

HA! Finally they are going to renovate Bellagio's rooms. Hopefully it won't be too contemporary.

November 8, 2010 11:44 PM Posted by John

Bobby has been on-record as saying he has never wanted to be The Guy. Too much responsibility for all that he already has, I suppose. He seemingly prefers the trenches of competition to boardrooms. I don't see him ever wanting to be #1.

Despite the fact that MGM is struggling right now, I think that a banker like Murren is what is needed at the helm. One can't say that he's not surrounded by people who know what they're doing. McBeath and Baldwin have been handed this leviathan of a project that was pretty close to cratering in the spring, but now... at least things are looking better than they were in March.

Right?

November 9, 2010 4:22 AM Posted by jay

City Center problems are only just starting. The surface hasn't been touched and many things have been masked. We all know its ate up a BILLION dollars in just 9 months of operation. It's going to be the END of MGM and shareholder Equity, watch and see. Their bonds tell the story, and smart money knows not to touch them!

November 9, 2010 4:34 AM Posted by detroit1051

" I've been thinking recently about re-calibrating this blog and it's content."

Hunter dropped a bombshell on us which intrigues me more than the Andrew Pascal story. What are you thinking about, Hunter? As much I've gravitated to Twitter and to other sites, TWHT remains the gold standard. Whatever you do, keep it the authority on casinos and design. I've got no ideas other than to want an even more laser focus on design, new construction, renovation projects, the materials used and marketing strategies.

No matter what you ultimately decide, I hope we can still participate and contribute.

Hunter, you're already teasing us about more CityCenter information. Can't wait, and your recent three part series on CC shows what TWHT can do.

We're all waiting with bated breath.

November 9, 2010 5:13 AM Posted by Jeff in OKC

Maybe that's the problem, Detroit, there isn't gonna be much design and new construction going on in the future. I know I love TWHT. It's no exaggeration to say that I will check Twitter, TWHT, Stiffs & Georges, VegasHappensHere, Vegas Tripping, Las Vegas Advisor & Sun websites at least 8 times a day. It's what I do to recalibrate between lying to customers and placating Bitch-Ass workers.
I know Hunter's a smart guy and I have always been very happy with each new way he taken his love of Las Vegas and the inter web. Think I'll listen to one of the old Worst Vegas Podcast episodes today, just for fun. If you want to take us somewhere different Hunter, I'll be riding along.
Thanks

November 9, 2010 8:31 AM Posted by Hunter

The short answer is that I'm not totally sure what I'm going to do. I don't mean to be mysterious - I'm not (currently) planning on shutting the site down or anything like that.

I also can't imagine I would ever do something like this without comments - having the comments is by far my favorite part of the whole thing.

I just want to make sure the right stuff is showing up here. VegasTripping does such a good job covering the daily news beat, I feel like that's less necessary, plus to really do that well, I'd have to devote a lot more time than I have.

I appreciate the feedback though, and the kind words.

November 9, 2010 10:35 AM Posted by mike_ch

Crystals just seems like the apple cart with $10,000 apples, where the owner just only needs to sell one.

It looks empty as hell, and unlike Bellagio which is a straight corridor the Crystals is often confusing and sometimes misdirectional. Not to mention there's a lot more square feet there

I don't know, maybe the things in there are sooooooo expensive that a couple sales a day keeps the whole place running, but otherwise it feels like watching people who are barely climbing above being victims of the recession darting past all this snooty estate stuff and get to the slightly fancier versions of the stuff you see at every other place on the street.

But hey, their loss is Caesars's gain.

November 9, 2010 1:28 PM Posted by mike_ch

The other thing I wonder with CC is whose money is being lost. Look at what's losing money. MO, how many hands are in that pot? MGM is making some of the money, Dubai is making some of the money, and I know the people who own the MO brand are making some of the money since they surely aren't giving that away.

When you look at what the DW folks are holding onto around the world, CC probably isn't one of the biggest, most hemorrhaging projects. Was there really that much demand for so much office space in a territory mostly known for tourism as to justify the tallest structure on Earth, or was that something they built just for the title? I know America's tourism-driven economies (meaning we're not including New York or Chicago here, even though they have tourism) couldn't support a building like Burj Dubai.

If the Aria casino is making money and Vdara isn't actually losing money, that's really all they need. The dining and nightlife angles can be outsourced if need be, and for a large part of Vegas they already are.

November 9, 2010 5:52 PM Posted by Hunter

So, Mandarin Oriental Las Vegas is owned by CityCenter LLC and operated by Mandarin Oriental Hotel Group.

In practical terms, that means that CC is the one losing the money when it comes to Mandarin.

MOHG gets paid a licensing fee, a marketing fee and a percentage of revenue.

November 9, 2010 6:20 PM Posted by detroit1051

This WSJ story said the most about MO's problems. Sounds like Dubai wanted to take a much tougher stance against Mandarin Oriental than Murren did.
http://online.wsj.com/article/SB20001424052702304879604575582253270407576.html

November 9, 2010 6:37 PM Posted by Hunter

In those documents, Murren comes off as aloof and kind of out of it. It's everyone else that's upset and worried and demanding better performance. He seems sort of resigned to it being this way for awhile.

November 9, 2010 7:33 PM Posted by detroit1051

"In those documents, Murren comes off as aloof and kind of out of it."

Aha! I knew Hunter would get the inside scoop.

November 11, 2010 10:56 AM Posted by socalduck

It appears that MO is getting a bit more competitive vs. Wynncore in terms of standard room rates. Looking at 12/20 - 12/22, published rates are in the low $200 per night range for both. However, for a suite, I can book the much larger Salon Suite at Encore for only $700 per night vs. $1995 for a Dynasty suite at MO. Yes, service at MO is excellent, perhaps better than TS, but certainly not $1300 a night better.

Hunter, TWHT is the definitive source for casino design and construction, as well as for information on the business of gaming. You have a done a great job with the site over the years. However, if you decide to do something different, I have no doubt that you will continue to find an audience.

November 16, 2010 6:34 PM Posted by motoman

I'd like to say "Ditto" to every word of detroit's comment above (Nov. 9, 4:34am). He really captured what this site has meant to us and been about since Day 1, and why I was so delighted to have stumbled over here immediately after our first, reality-altering stay at Wynn in 2005. It is only from here that I discovered other sites such as VegasTripping and VegasTodayAndTomorrow, and was able to fuel an armchair interest to the point of something more like obsession.

Laser-like focus, detroit said; and that's exactly why this site was near-daily reading while VegasTripping was more of an acquired taste -- there's such a thing as too much of a good thing, it seemed at the time. If there's more design & business discussion popping up over there and on Twitter that's fine but, again quoting detroit (with a nod to socalduck), TWHT remains the gold standard because of its focus.

Perhaps Hunter, if demands on your time require more attention devoted to revenue-generating pursuits such as VegasMate -- and of course to the ongoing podcast -- you could begin to bring in some help with content & management of this site. There seem to be a number of regulars here who would be able to maintain the focus and editorial standards you have established. Folks like detroit, Dr. Dave and Mr. Simpson, for instance. Barring any potential conflicts of interest or other issues.

November 16, 2010 10:30 PM Posted by Hunter

In case I haven't been clear enough about this point, I love publishing well written stuff from other people. It's great when I have the chance to do that. I am picky though...