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Something happened in mid-December that people in Las Vegas may not see again for some time; a new casino launched. Owned by a bank, the US$3.9bn Cosmopolitan of Las Vegas says it will do something different from the rest of The Strip. Its rivals say it will have to. Phil Martin reports.


polishwithoutpretence UNITED STATES


With some analysts claiming there won’t be any new Las Vegas casinos for a whole decade, the December opening of 2,000 of The Cos- mopolitan’s 3,000 hotel rooms generated plenty of interest. Launched as having ‘polish without pretence,’ and for the ‘curious’ coming to Las Vegas, the venue’s prelaunch marketing campaign has seen half dressed bellboys and white rabbits dominate TV commercials as the prop- erty tries to set itself apart from its neighbours. The immediate differences are there to see immediately. The Cosmopolitan’s struc-


ture sees two 50-storey sky scrapers, ringed by wrap around balconies, spring up between CityCenter and Bel- lagio on the west side of the Strip.


The Cosmopolitan’s CEO


John Unwin said: “The Cos- mopolitan is about creating a resort experience that is truly different than anything else that exists right now in Las Vegas. When you combine spacious suites, high design from talent like David Rockwell, a curated


award-winning dining col- lection, unparalleled service and gaming, we know we are giving guests an experience that’s been missing in Las Vegas and harkens back to an era when guests felt con- nected, inspired and engaged by their resort. It’s accessible and fun. People have this vision of Las Vegas as being almost a caricature of itself. This is not more of the same.” As such there are no


formal eateries although it will offer culinary concepts from some of the country’s top chefs and restaurant brands, each opening for the first time in Las Vegas. There’s also no headliner luxury fashion retailers such as Gucci, Prada or Armani. Instead, the resort’s retail line-up features brands not seen elsewhere on The Strip including British-brand All- Saints and Beckley “You can still buy US$10,000 items in those stores but they’re much more accessible. You can feel comfortable exploring on your own,” Unwin said. “Same with the restaurants. You don’t have to be an urban sophisticate to enjoy them. They’re not highbrow in the sense of what’s been


done. “I think there will be a lot of customers that come to Vegas to see what we are all about. Some people who are not just pure gamers, but want to come and stay in a cool hotel, eat in new restau- rants, do some unique shop- ping.” Its resort layout will also


be different to other Strip hotel-casinos with the verti- cal design of its two 50-storey towers seeing shops and restaurants on multiple f loors throughout. It is, of course, not owned by one of North America’s gaming giants or by an independent but by a bank. Germany’s Deutsche Bank took over in 2008 when Ian Bruce Eichner and his company, 3700 Associates, defaulted on his loan. The bankers had loaned Eichner $1bn and then had to invest a further


Caesars conquers with name change Harrah’s Entertainment has now completed its name change to Caesars Entertainment Corporation. The Harrah’s name will continue to be one of the company’s primary brands, along with Caesars, Horseshoe, Total Rewards and World Series of Poker. Gary Loveman, chairman, president and CEO of Caesars, said: “In recognition of Caesars’ status as the world’s pre-eminent and most respected casino brand, we have changed the name of our parent company to Caesars Entertainment Corporation. The change reflects our evolution as the industry’s leading provider of branded casino entertainment. While our name is changing, our dedication to who we are as a company will remain the same. This re-branding of the corporate name can open exciting new opportunities for us in the future.” The company also announced that it was not pursuing its initial public offering of common stock at this time due to market conditions.


Cosmopolitan opening could be Vegas’ last for a decade


prudent investor, we will continue to evaluate all of our options. We are extremely pleased with the final result. Deutsche Bank concluded that building a new brand, with a unique identity and guest experi- ence, was central to the overall vision for The Cosmo- politan of Las Vegas. As a result, rather than partnering with a existing hotel brand, the bank brought on some of the best executives in the gaming and lodging space to form a highly experienced management and operations team. We’re confident that this team will help The Cos- mopolitan become a premier feature of the city’s business and entertainment land- scape.”


The 100,000-square-foot casino has 83 table games and 1,474 slot machines, along with a Cantor Gaming run race and sports book, expected to open in the first quarter of 2011. It’s a standing start for


Deutsche Bank and The Cos- mopolitan in terms of cus- tomers


although an


agreement with Marriott International will give The Cosmopolitan access to a database of potential visi- tors.


spent $3.9bn to complete construction.


Union Gaming Group


analyst Bill Lerner said The Cosmopolitan would need to generate cash flow as soon as possible to reduce the burden of costs associated with opening the property. He said he expects Deutsche


Bank to ‘wait until the envi- ronment fosters a reasonable return’ before putting it open for sale.


“Gaming is not its priority


or a part of its future strat- egy,” Lerner said. Deutsche Bank spokesman John Gallagher commented:


“Like any Tabcorp triples Queensland investment


firforaqueen AUSTRALIA


Tabcorp Holdings will invest AU$625m, three times as much as originally stated as it strives to make its Queensland casinos world class resorts to take on Australia’s best. The state government has granted the company an additional 500 poker machine and 50 gaming table licences.


The company in October announced plans to spend $175m upgrading its Jupiters casino on the Gold Coast, but has now doubled the investment to $350m with plans to build a new 200-room hotel by 2018. Tabcorp will also spend a further $260m expanding its Treasury casino operation in Brisbane, adding a new 400-room hotel, events centre and upgrades to the existing hotel and casino by 2015. Another $15m will


2 January 2011 • internationalnews


be spent upgrading the Jupiters casino in Townsville. Tabcorp chairman John Story said that the investment shows confidence in the long term future of the Queensland tourism market. “We see Queensland as one of the premier desti- nations for interstate visitors and tourists. Our investment will create world class destina- tions with a wide range of entertainment and


leisure choices for our customers. This will put Queensland in a stronger position to grow its tourism market and compete successfully with new destinations in Australia and across the Asia Pacific region.


“The Queensland investment follows the


redevelopment of Star City in Sydney. Together, these investments will make the casinos an attractive growth business follow- ing the proposed demerger from Tabcorp,” he said. Tabcorp chief executive officer Elmer Funke Kupper said that the investment builds on the good progress being made with the expan- sion of Star City casino in Sydney. “The invest- ment in Queensland is consistent with our strategy to create attractive international entertainment destinations. The Queensland project will commence in 2011 as the invest- ment in Star City is nearing completion. We


now have secured attractive growth options for the entire casinos business for the next five to seven years.” In total, Tabcorp has 3,136 slot licences and 265 gaming table licences. With the state government also looking to review the classi- fication of multi-terminal gaming machines, which offer electronic versions of games such as roulette and blackjack, but currently require a separate pokies licence for each terminal, Tabcorp could potentially install multiple elec- tronic roulette or blackjack terminals using a single table game licence, greatly increasing the number of electronic gaming machines it is allowed to operate.


The operator said the expansion would boost earnings before interest, tax, deprecia- tion and amortisation by $90m by 2018, repre- senting a 25 per cent increase on last year’s figures.


Some believe its opening comes at the wrong time. Mike Leven, president and CEO of Las Vegas Sands, said: “I don’t know how Cosmo- politan will play out, but it can’t be helpful obviously. More capacity in an already difficult market can’t be pos- itive for the market. How big a negative? I just don’t know.”


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