Young CFO’s moves to delay repayment of company’s obligations bank on economic recovery
Monday, Feb. 15, 2010
About a year ago, investors were so convinced that Harrah’s Entertainment would file for bankruptcy protection that the company’s bonds traded for 10 cents on the dollar. Since then, the world’s largest gaming company has surprised naysayers by carving out a foothold of three years during which it can afford to make interest payments on its debt.
In April 2008, 60-year-old Cheryl Rose got a bad cough that wouldn’t go away. Her doctors thought she had asthma — a bizarre turn for a woman who had never had difficulty breathing, not even during frequent workouts at the gym.
When asked why it has taken unionized dealers more than two years to make progress toward a labor contract at Caesars Palace, a union leader said management was treating dealers like “garbage.” “These dealers are professional people who take pride in their jobs, but quite frankly, they’re treated like a bunch of second-class citizens,” said Joe Carbon, gaming director of the Transport Workers Union.
Surprised observers of the $25 million acquisition of 2.15 acres at Harmon Avenue and Las Vegas Boulevard by developer Brett Torino and two undisclosed partners had one key question: how to value Strip property in this — or any — economy?
When regulators said last year that MGM Mirage needed to cut ties with an “unsuitable” business partner in China, the casino giant said it would defend itself against the allegations raised in New Jersey.
A Clark County District Court ruled today that Harrah’s Entertainment must turn over records to attorneys representing a high roller who allegedly owes $14.7 million in gambling debts.
It’s the first casino company to emerge from bankruptcy amid the crippling recession
Monday, Jan. 25, 2010
Less than two years after its bankruptcy filing, Tropicana Entertainment’s debt has been wiped clean, and the company’s new owner, billionaire Carl Icahn, is injecting $150 million to pay creditors and upgrade properties.
Carl Icahn is expected to take over ownership of the bankrupt Fontainebleau Las Vegas resort after two potential competitors vying to buy the property failed to submit qualifying bids as of a 5 p.m. deadline Friday.
Union says Harrah’s Entertainment’s proposed workplace rules prove the gaming giant ‘never intended to negotiate’
Monday, Jan. 18, 2010
Two years after casino dealers at Caesars Palace voted for union representation, they still don’t have a labor contract and relations with management have gone from bad to worse. Both sides filed complaints with the National Labor Relations Board in late December.
Gamblers who prefer higher stakes are dealing Vegas a winning hand
Sunday, Jan. 17, 2010
An exclusive class of customer deserves a good deal of credit for the Strip’s first increase in reported gambling revenue since 2007 - high rollers who play a game that most Americans don’t pronounce correctly. Baccarat, the high-stakes card game favored by James Bond, accounted for nearly 20 percent of the Strip’s gambling revenue in November, the Gaming Control Board announced last week. Strip casinos reaped $92.7 million from baccarat players that month - a 136 percent increase from a year ago.
Three options for the billionaire investor Carl Icahn should he acquire the resort
Saturday, Jan. 16, 2010
In years past, casino bankruptcy auctions generated a frenzy of activity, with multiple bidders emerging at the last minute with the promise of cash at the other end of a cell phone. Those with little money or credibility would quickly drop out, leaving a few usual suspects vying for a shot at a bargain buy. There may be no such party for the bankrupt, unfinished Fontainebleau Las Vegas resort that is sought by billionaire investor Carl Icahn.
Harrah's Entertainment will take over the management of the Planet Hollywood resort on the Las Vegas Strip at midnight tomorrow as part of the company's longer-range plan to buy the property, Harrah's announced today. In an internal memo to employees today, Planet Hollywood owner Robert Earl said things would be "business as usual" during the transition.
Penn National Gaming, which spent months investigating the purchase of the unfinished Fontainebleau Las Vegas resort on the Strip, will not bid on the property at an upcoming bankruptcy auction, a spokesman for the Pennsylvania-based casino company said today.
People — your customers and employees — are your most important resource
Monday, Jan. 11, 2010
The 1989 debut of the Mirage, Las Vegas’ largest and most expensive luxury hotel at the time, was a critical turning point in the city’s development. Even with the most elaborate bells and whistles at their disposal, executives had to develop a strategy to attract a new kind of customer — people who thought Las Vegas offered little more than gambling and kitsch.
Isle of Capri would manage resorts if Station loses them in bankruptcy
Wednesday, Jan. 6, 2010
St. Louis-based Isle of Capri Casinos Inc. on Wednesday confirmed reports by Debtwire that Isle has agreed to manage four Station Casinos Inc. properties should they be spun out of Station’s bankruptcy case.
Gaming Control Board has expanded power to discipline operators
Wednesday, Jan. 6, 2010
If you’ve ever had a problem with your ex-wife, your lawyer or a friend, it might be nobody’s business but your own. Except if you own or operate a Nevada casino — in which case, all of your dirty laundry, no matter how lightly smudged, is subject to scrutiny by the Gaming Control Board.
Struggling under a mammoth debt burden in penny-pinching times, Strip casino giant Harrah's Entertainment is taking the offensive with a press release informing consumers that none of the company's Las Vegas hotels charge so-called mandatory resort fees.
Among the top 50 careers recently identified by U.S. News and World Report for their stability, growth and earnings potential in 2010 is a job that doesn't seem to fit the bill.
T. Rowe Price has bet $277 million on casino company’s future
Monday, Jan. 4, 2010
Although short sellers were betting on the demise of MGM Mirage last year, portfolio manager Joseph Fath of T. Rowe Price was buying shares. The money management giant has found itself increasingly alone in thinking things can only get better.
This month’s abrupt departure of MGM Mirage executive Gary Jacobs stems from East Coast regulators’ concerns about Jacobs’ handling of the company’s business partnership in the Chinese enclave of Macau, knowledgeable sources say.
Profits might drop as discounts lure thriftier visitors
Friday, Dec. 18, 2009
After a night spent gaping at Aria’s modernist splendor, draining designer cocktails and downing caviar and sushi, invited VIPs and other well-wishers at the opening gala for CityCenter’s centerpiece resort woke up Thursday to a grim reality on the Strip: Amid the worst recession in 70 years, only the toughest, best-equipped competitors will survive the coming battle for customers.
Sculptures and paintings sprinkled with great care throughout Las Vegas’ newest Strip attraction
Thursday, Dec. 17, 2009
CityCenter's $40 million modern art collection has instantly put the resort on the map as one of the world’s largest public installations of corporate-owned art. Although some industry observers worry CityCenter isn’t revolutionary enough to generate strong profits in a recession, art publication artdaily.org recently hailed it as a “cultural destination of worldwide significance.”
In recent weeks a couple of hundred CityCenter employees have cycled through a warehouse on Dean Martin Drive each day to pick up their uniforms. Making sure the correct number of uniforms in the appropriate sizes are on hand has kept Barbara Davis busy.
Slot machine makers unveil their jazziest to attract younger players
Saturday, Dec. 12, 2009
Behind a temporary wall and a beefy security guard warding off interlopers, slot machine manufacturer WMS Gaming showed off one of its most elaborate prototypes at the casino industry’s premier trade show last month — a slot machine based on the “Lord of the Rings” movie trilogy. It is complete with spinning symbols of goblets and swords, a digital Gollum who moans “precious” and a screen resembling an ancient map of a world inhabited by wizards, elves and, of course, hobbits.
If paper profits in the stock market fueled trips to Las Vegas during the bubble years, then the collapse of the market in the recession conversely may have hurt business at Strip hotels to a disproportionate degree.
Spa pampers its employees, who pass treatment on to customers
Saturday, Dec. 5, 2009
Spa-industry veteran Jennifer Lynn acknowledges what out-of-towners have increasingly been complaining about: Customer service — long a Las Vegas hallmark — is suffering as financially beleaguered hotels can’t afford to pamper run-of-the-mill guests as they used to.
Many machines there will work in concert to give house flexibility
Monday, Nov. 30, 2009
Casinos have long complained about incompatible slot machine hardware and the increasing cost of upgrading their floors. But that’s changing with CityCenter and its 4,004-room Aria resort, which will open Dec. 16 with many of its 2,000 slot machines connected by a high-tech system developed with the cooperation of major slot manufacturers. It’s an unprecedented effort, unusual in the gaming industry as well as most of the business world, where Apple and PC-based computers and AT&T and Verizon cell phones, for example, run on discrete systems.
Jim Murren was MGM Mirage’s chief financial officer when he conceived of CityCenter and persuaded the company’s directors to build it. That was during a good economy.
To Jim Murren, a CEO who had studied art and architecture and lived in New York, Las Vegas needed a true urban center
Sunday, Nov. 29, 2009
Visitors to CityCenter, the Strip’s newest spectacle, will be driven to look up at the glistening glass and steel. It is an inexorable pull, to cock your head backward and take in the sweep of six high-rise towers — including two that lean — that create an urban scene unlike any other. The man who conceived of this place, however, would like to draw your attention to a small park bench. It is found near the center of the 67-acre site, alongside Aria, the flagship high-rise filled with 4,004 guest rooms.
Some say features common in machines may lull players into crossing the line
Tuesday, Nov. 24, 2009
Hoping to solve the decades-old mystery of why some people develop gambling problems, a growing number of researchers are studying the other side of the equation: the games that gamblers fixate on.
Second looks may be needed to spot employees by what they’re wearing
Monday, Nov. 23, 2009
At CityCenter’s 25,000-square-foot uniform distribution center on Dean Martin Drive, Jhane Barnes, a slight woman with squarish glasses and short hair, proudly shows off clothing racks heavy with new uniforms.
Similar disorders found in alcoholics, those with a compulsion to gamble
Monday, Nov. 23, 2009
Experts who study gambling addiction remain a long way from knowing why people develop gambling problems. But researchers now know what happens inside the brains of gambling addicts that fuels the addiction, and how best to help them.
Before the recession, ads for Las Vegas resorts appealed to a desire for frivolity and conspicuous consumption with taglines such as, “Some fantasies just don’t work anywhere else,” “Everything in moderation? Yeah, right,” and “Parents gone wild.”
Convention planning, stabilizing of housing nationally good signs for Vegas
Monday, Nov. 16, 2009
As a real-time indicator of how confident American consumers feel about spending their money, earnings of the big casino operators on the Las Vegas Strip haven’t inspired much confidence lately. And yet, a growing number of industry executives and analysts believes the market has bottomed and are forecasting a modest rebound in 2010, in part based on evidence that convention groups are more confident about booking rooms next year and signs that year-over-year gambling revenue declines have plateaued on the Strip.
But in assigning most-coveted spots, maker cops out
Tuesday, Nov. 10, 2009
There may be some squabbling among Vegas aficionados over whether these assessments of relative value are accurate. The resorts, though, are just happy to have won a place at the table — or, more specifically, the Monopoly game board. They are, after all, in the gaming business.
Professionals say they can handle promotion themselves
Monday, Nov. 9, 2009
With Las Vegas tourism in the dumps, Virginia Ridgway, a retired gift shop owner in Goldfield — a mining boomtown decades before Vegas became a vacation hot spot — is doing her part. She hosted a luncheon to present her catchphrase, “Deal Vegas In,” to tourism bigwigs in Las Vegas including honchos with the Las Vegas Convention and Visitors Authority.
In its last earnings report before the company opens its $8.5 billion CityCenter complex next month, MGM Mirage on Thursday projected an improvement in business next year. Part of this optimism is based on a new sales strategy for filling its hotels.
Companies use social networking to connect, lessen damage from complaints
Monday, Oct. 26, 2009
Social media Web sites such as Facebook and Twitter are changing the face of customer relations at major Las Vegas hotels. Resorts are setting up their own fan pages where executives can monitor customer suggestions on how to improve business, bask in guests’ kudos, offer immediate assistance to customers in distress — and cringe when unhappy patrons post critical remarks that ding their companies.
Online reservation sites are offering discounted room prices that reflect the effects of the recession on the three hotels opening for business in December at MGM Mirage’s CityCenter complex.
Agents making more arrests; casinos reluctant to publicize cheats
Monday, Oct. 19, 2009
The state’s casino cops have been busy. Could recession-fueled money troubles be blamed for the brazen acts of theft that have surfaced in recent months? Gaming board agents have made nearly 400 arrests in connection with casino and gambling-related crimes in Nevada this year, compared with fewer than 300 for all of 2008.
The bills amount to more than likely offer; Penn National exec says building worth 'about zero'
Tuesday, Oct. 13, 2009
Whether front-running bidder Penn National Gaming buys the unfinished Fontainebleau Las Vegas resort out of bankruptcy in coming weeks may turn on the success of recent negotiations with attorneys representing the resort’s subcontractors. They are owed about $375 million for work completed in the months leading up to the end of work on the resort. Penn wants to use the Fontainebleau as the flagship destination for customers who patronize its nationwide network of smaller casinos, much as Harrah’s Entertainment does with its Las Vegas properties.
Of all the buildings under construction nationwide left unfinished because of the recession, the Fontainebleau Las Vegas resort, which analysts say may be nation’s largest and most expensive stalled construction job, might be the poster child for badly timed development.
MGM Mirage planning one-on-one meetings with buyers
Monday, Oct. 5, 2009
CityCenter has reduced prices of its condos by 30 percent in an effort to satisfy concerns from condominium buyers who signed purchase contracts for the units more than two years ago, when the real estate market was booming. "We believe that in this economic climate this price reduction is an appropriate step to take on behalf of our buyers as to provide them greater flexibility in closing on their residences," Bobby Baldwin, president and CEO of CityCenter, said in a statement.
In normal times, a casino company within months of opening a major resort would use every opportunity to tout its virtues. But until recently, MGM Mirage has been distracted by a steady grind of negative news surrounding CityCenter.
Rather than buy into companies, investors mull buying up debt — with chance of calling shots
Monday, Sept. 28, 2009
One man’s troubled casino is another man’s potential buying spree. When times were good, private equity firms were knocking down doors to invest in Las Vegas casinos. Stung by the recession, some of these same firms are now looking to buy them for cents on the dollar.
Return to an iconic theme follows ad campaign tied specifically to the recession
Sunday, Sept. 27, 2009
For an ad man with an ounce of imagination, Las Vegas is rich with sales material — cheering gamblers, sexy nightclubs, celebrity-chef restaurants, haute couture boutiques and stunning stage productions. But none of these would be highlighted in Las Vegas’ most successful advertising campaign. Instead, the commercials would only tease, thick with innuendo, to unspoken tourist experiences. “What happens here, stays here” sold Vegas for years.