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Every Friday morning, James J. Murren heads to the Las Vegas Strip in his chauffeur-driven SUV to check on the status of his dream project. "Look at that," says the chairman and CEO of MGM Mirage (MGM), pausing inside the Aria Resort & Casino. "The marble, the vaulted ceiling—it looks like the Vatican," according to a BusinessWeek report. Not everyone shares Murren's enthusiasm. Aria is one of four hotels in MGM's CityCenter resort, which will start opening its doors to the public in December. The $8.5 billion development is the debut that every casino manager in Vegas dreads.
CityCenter: The biggest bet in Vegas
(via BusinessWeek) · November 2, 2009 · 9:34 AM
Discussion: 47 comments so far...
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James J. Murren will be getting fired within the next couple of years.
I'm sure he has a huge golden parachute in place though when City Cemetary and MGM go down in flames from this project.
He'll get 100 million and the stockholders will be left holding worthless paper.
Harry Reid's latest campaign ads would have you believe that he single-handedly saved the Las Vegas City Center by convincing banks to provide the funds needed to avert bankruptcy. The truth is that US banks hold a minority stake in the City Center. MGM shareholders (e.g. Kirk Kerkorian) finance about half of the $8.4 billion and Dubai World finances the rest. Dubai is one of the seven emirates that comprise the United Arab Emirates.
In March, 2009 Dubai World stopped financing City Center and sued MGM Mirage for cost overruns and mismanagement. Even with help from banks, MGM did not have sufficient cash to finance the center alone. They did manage to collect $200 million, which covered expenses for one month, but MGM soon came to realize that without Dubai or another investor, the City Center would be doomed.
A month later, Dubai World, dropped its suit and agreed to keep City Center going. So if you want to thank someone for saving City Center, thank the Arabs, not Harry Reid.
In the final analysis, this will be a textbook study for decades to come of the hubris of corporate greed and the stupidity of all the MBA types trying to run these gaming institutions. City Center will fail, not because of design, but of execution and economic forces that continue to change the landscape forces more peopel to spend less on "luxury" and more on self preservation. All of the highroller clubs, dining establsihement on the strip are cutting back and reducing prices with many announcements of venues closing outright due to lack of patronage. We are years away from any normalcy. Only the Wynn's and Adelson's will survive.
If I'm not mistaken, I understand that Dubai World is in financial trouble as well.
Ca mon man.. "The marble, the vaulted ceiling--it looks like the Vatican,"... really Mr. Murren? From the outside it looks to me like any other blue glass skyscraper you see in any other major city. It doesnt look like a hotel casino, it looks like an office building... real original there.
Yes this is a big undertaking but with the backing of Dubai World the risk and cost to build is manageable.
I see and hear Harry Reid claiming he was the primary one behind the deal and getting the lending pushed through, hogwash, but not for Dubai World agreeing to continue, Harry Reid did nothing. Harry Reid is a just another pathological liar, hopefully Sue Lowden tells the truth about what really occurred and expose Harry Reid for what he really is, a mindless troll who is paid to be a career Liar.
For you liberals who feel otherwise, you're a troll too and whatever comes out of your lips is received as such, just another liberal flapping their lips without any substance or an attempt to skew the facts into something it isn't, or as we call it, LIAR.
CITY CENTER IS NOT FINANCIALLY SUSTAINABLE AT ELEVEN BILLION DOLLARS COMPLETED !!!
THE CORPORATE DECISION MAKERS MEAN WELL - BUT THEY WERE WAY OVER THERE HEADS WITH THE PLANNING & DESIGN !!!-- MGM/MIRAGE WAS NEVER ABLE TO GROW ORGANICALLY - BECAUSE THEY NEVER HAD THE CREATIVE MARKETING VISIONARIES TO BUILD - MEGA HOTEL THEME CASINOS & HAD TO ALWAYS BUY OTHER PEOPLES DREAMS & VISION !!! THERE FIRST PROJECT MGM GRAND WAS A VERY STRONG & COMPELLING THEME - BUT AFTER THAT FRED BENNINGER COULD NOT HELP KERKORIAN GROW ANY MORE !!!
EGO WITH OUT EXPERIENCE IN BUILDING MEGA STRUCTURE THEMES & NOT UNDERSTANDING - YOU DO NOT TAKE 67 ACRES OF PRIME LAS VEGAS STRIP LAND & USE IT FOR A MIXED USE PROJECT- WAS OBVIOUSLY FLAWED & INEPT CONCEPTUAL THINKING !!! - THE DECISION MAKERS EVEN TODAY OPENLY ADMIT - THEY WANTED THE WORLD TO KNOW THAT MGM/MIRAGE IS MORE THEN A HOTEL CASINO COMPANY FOR CORPORATE IMAGE !! - INVESTORS ONLY CARE ABOUT HOW MUCH MONEY THERE MAKING - NOT CORPORATE IMAGE !!!
THE 67 ACRES SHOULD HAVE BEEN USED TO BUILD - THREE PALTIAL MEGA STRUCTURE HOTEL CASINO THEMES TO RIVAL - CAESARS - BELLAGIO - VENETIAN & THE WYNN !!!
KIRK KERKORIAN BET ON THE WRONG HORSE - BECAUSE HE DOES NOT HAVE THERE INTELLECT & ACADEMIC ABILITIES & HE BELIEVED BECAUSE THEY ALLOWED HIM TO GROW WITH BUYING UP OTHER PEOPLES DREAMS - THEY WERE CAPABLE & COMPETENT TO DEVELOP AN ELEVEN BILLION DOLLAR PROJECT WITH JUST ONE INCOME PRODUCING HOTEL & CASINO BY THE NAME OF THE ARIA - THAT IS NOT A MEGA THEME & MEANS NOTHING TO THE CURIOS PUBLIC & EXPECT IT TO SUPPORT THE OTHER THREE BUILDINGS - WAS TOTALLY FLAWED & UNREALISTIC BY WELL INTENDED - VERY NAIVE CORPOATE DECISION MAKERS - PLAYING MONOPOLY - WITH KERKORIANS MONEY & THE INNOCENT SHARE HOLDERS MONEY !!!
DID THEY EVER CONSULT WITH THE REAL MARKETING VISIONARIES FIRST LIKE - SHELDON ADELSON - STEVE WYNN & PER HAPS A JAY SARNO TYPE !!!
OBVIOUSLY NOT -- THEY ARE STILL INNOCENTLY CLUE LESS & HAVE NO IDEA HOW MUCH DAMAGE THEY HAVE CAUSED -KIRK KERKORIAN WHO IS VERY STREET WISE - WHO BOUGHT A BILL OF GOODS FROM INEXPERIENCED EGO'S - WHO SHOULD HAVE HAD ANOTHER DUAL CEO TO ANSWER TO WITH CREATIVE MEGA MARKETING THEME EXPERIENCE !!!
KIRK KERKORIAN IS A GREAT ROLE MODEL TO ALL POOR BOYS - BECAUSE HE ALSO IS REALLY -- A POOR BOY FROM HIS BIRTH & WAS ABLE TO OVER COME ALL OF THE CHALLENGES THAT POOR BOYS FACE !!!
I HOPE MR. KERKORIAN CAN NAVIGATE HIS WAY THRU THIS CORPORATE TRAGEDY & GO DOWN IN LAS VEGAS HISTORY AS A REAL WINNER - HE DESERVES THAT & SHOULD NOT BE ROBBED OF THAT ACCOLADE !!!
Hey BELAIR, will you please stop posting in all caps? You don't do yourself any favors!
Well unfortunately "CaLiGuYiNvEgAs"this cluster fu** of a resort wont even be paid off in your lifetime let alone be imploded..
it's going to do really well those first few months, like everything else that is new, and the suits will say "look how good we're doing" and "look how many people we've employed" and then a few months later, probably this coming summer the layoffs will start.
the recession is far, FAR from being over. the liberal left has declared war on "rich" people and the free market and those people are saving their money.
i wouldn't spend a freaking DIME to pay people that voted for a guy that wants to take MORE money out of my pocket.
City Center will have to draw customers at the expense of the other casinos/hotels in order to sustain itself. If MGM can remain profitable at its other sites they can maybe sustain City Center long enough to get through the worst part of the recession. It's not impossible, but given the debt MGM has to service it will be difficult.
The biggest blunder in Vegas history. People can't afford to fly here let alone rent a room for the weekend.
I would have to wonder if they are going to offer public rewards for information that leads to recovery monies they was defrauded from them during the fast paced construction process to help offset the cost overruns.
I would bet if they offered the same rewards as Qui tam rewards are, 33% of the recovered amounts that many people would come forward and help them, I've heard the rumors of how much so it would seem that MGM would seek any avenue to help keep the legal costs down and recover the easy amounts first and the claimed amount later.
About two weeks ago I submitted my comment about Harry Ried saving City Center (above)to the Sun and they would not publish it. Maybe the comment was not well-written, but most likely, the Sun does not want to tarnish their Pro-Harry/Rory campaign.
Hybrid, the Sun doesn't screen or approve comments before they're published.
gdperson
The biggest blunder was the placing of Las Vegas in the middle of a desert. Withing a couple of decades the desert will take back what was taken from it, and by then your average daily temperature will be about 12 degrees higher, thats around 130F
if it works, it will work at the expense of other casinos...
It will do nothing for the economy.
I don't recall reading where flights are increasing to LAS, on the contrary, they are decreasing. Except of course, the British Airways nonstop but that will not come close to filling all the rooms that are available.
The problem is really not on the Las Vegas end. Its on the other end. The end where people take off from to get to Vegas.
Until the economy turns around and people have money to spend, they ain't coming... People that think the bullet train is the answer need to understand that as well.
It doesn't matter the mode of transportation. Its the numbers of people using it. If demand was stronger, the airlines would be adding flights.
It's a shame that they placed that Pig on the strip. I dealt at Little Caesars 79 early 80s, the hole in the wall where Paris now sits.. The strip was about a 20 foot walk from my crap table. Dunes across the street, Aladin to my left, MGM to the right.. Landmark behind me.. they blew them all up (down)... I had to go to the Stardust when I visited to be in a Casino where I didn't have to look at the logo to remember what freaken building I was in.. then they blew her up too. What a shame. City Center, perhaps the last design I would have considered. One building seems to tilt so much that I feel like i'm stoned, even when i'm not. It's really is sad, economy and corporate financials aside. What I can't understand is, if a player writes a bad check for $500 at an MGM property, they seem to have the whole world looking for them to pay up. Yet MGM can blow billions of OPM, and they walk free. This would have been a great complex to place 2-3 miles off the strip, a destination unto itself, instead of canabalizing business from themselves and the other casinos. Vegas will be back, the economy will return, if not, none of this really matters anyway. If Boyd is listening, think of how much ahead of the game you would have been if you left the Stardust alone, fixed her up, instead of paying XX million a month to secure her remains. Did you REALLY need to place a 5.5 billion dollar city in her place? Here's an idea for those of use who miss 'old' Vegas... Take the Stardust property, and build a multi themed replica of the Stardust, Landmark, Dunes, Hacienda, The Barbary Coast and a few others. Have them in a circle with a massive pool in the middle along with some open space,,,, concerts, food courts, etc.. I think you'd be surprised at how much business you'd get by going back to old Vegas. That would be a new and exciting theme for the New Vegas, Old Vegas! Give me a call.. i'd love to help be a part of it!
City Center will be great success, IMO. However, due to too much supply, some of the older casinos will need to be shut down like Imperial Place, Flamingo, Showboat, Golden Nugget, etc, etc. Those places aren't bringing in quality people to the city so in the best interest of Vegas they need to go.
I'm going to have to agree with a couple of the other commentators here. City Centre is absolutely cannibalizing it's competition. You guys can keep building all the mega resorts you want, all it means is occupancy rates go down and I can get a cheaper room during my yearly trek to sin city. Taking 70 acres of land and slapping another 3000 rooms to compete with the already empty rooms won't help the overall viability of the other properties on Las Vegas Blvd, and I'm pretty sure that's not going to help Vegas' economic situation any, is it? Also? Once you've seen one mega resort you've seen them all....Murren can go ahead and think it's as gorgeous as the Vatican, but I can get my eye candy at any of the other mega resorts on the strip...
And lastly, instead of building new resorts why not fix some of the older gals on the strip instead? Christ, I'm actually shocked old jalopys like the Imperial Palace and Barbary Coast are still standing. Why can't someone toss a little money at those instead? I've been coming to Vegas for 15 years now, and I'm still shocked those beasts are standing...what, when a perfectly good Aladdin bit the dust and go revamped into Planet Hollywood? (shakes head) Thank lord they haven't imploded the Tropicana yet, that'll be the only bit of old Vegas left soon, I'm really pleased that Onyx is helping revamp it, instead of tearing it down, which seems to be the way.
The Flamingo will NEVER go It's the first real "Carpet Joint" this town ever saw, and started the elegant trend on the dusty highway. It should be made a historical landmark, and NEVER be allowed to be imploded!!
Showboat
????? Did I miss it?
vegasfun01
The Flamingo??? Are you nuts???? NO WAY!!!
That should NEVER be torn down!!! I agree with environ - it IS a historical landmark and a very nice place.
It is a shame that no one is pulling for this project to make it.
There is just so much negativity in all of these postings. I agree that things have definitely changed for the worse, I have been here since 1976.
We need to rally together and make City Center a success for the good of Las Vegas.
"We need to rally together and make City Center a success for the good of Las Vegas."
LOL, What exactly do you mean by that? You want everybody to get together in front of the place and have a pep rally with cheerleaders every day?
Sorry buddy , but the only thing that is going to make that place a success is a large amount of people going in there and losing their money gambling and dropping money on overpriced rooms and food.
And right now in this economy there is very few people out there in this country that want to do that.
the fact is, the mega-resorts bring in the rich and therefore raise mega-bucks in taxes. we are talking billions. all the old places need to be destroyed. they serve no purpose other then to feed on the locals, who should not be gambling. you should not live in vegas if your are a gambler. you will lose it all and end up on the street. these are the facts and no one with any inteligence can dispute them.
the Flamingo should be tore down tomorrow. their pool scene is a joke. 90-year old women with no clothes on. joke!!! who wants to see sagging boobs?
I predict that the project will hire 10,000 or more and that other places will lay off 15,000 or more. What goes around comes around or some such thing. For every action there is at least an equal and opposite reaction. Ok, so all those who don't like sagging boobs should look in a mirror or maybe confer with a plastic surgeon! It happens to almost everyone. Enjoy life and be prepared to take some of the increasingly tired and poor into your house or apartment!
I love and miss Mecca, only with a gun at my head will i be back. Why with the tribe in FLA. i get free play, food, and rooms. No 6hr plane ride, and the [new] tight Vegas. I like other low rollers will game any where but Vegas. Go back too the old way, I'll be back on the next flight.
"City Center will be great success, IMO. However, due to too much supply, some of the older casinos will need to be shut down like Imperial Place, Flamingo, Showboat, Golden Nugget, etc, etc. Those places aren't bringing in quality people to the city so in the best interest of Vegas they need to go."
I'm confused, what exactly is your idea of the type of "quality people" that should visit Las Vegas?
City Center will be absolutely packed from day one. Mark's from the midwest will max out the penny slots. MGM's profit will SOAR.
Then I woke up. What an idiot dream.
They should rename City Center, 'SLOT'S OF FUN", EAST.
Instead of .10 cent craps, they should sell .9 cent buffets
It seems to me that a more than half a century ago there was a visionary that built the Flamingo Hotel and Casino in the middle of nowhere. It too was plagued with mismanagement and costs over runs.But who back then could envision what came after. If we dare to dream and believe, imagine what can be in store for tomorrow. I choose to make lemonade while others complain about the lemons.
Keep smoking your crack pipe. After the 3-6 months of promos to keep this place relatively full, reality will set it. It will be tits up within 1-2 year.
Whether or not it takes MGM as a whole down with it is yet to be seen.
This town is FUBAR for 5+ years, and probably 10. If you can't see that, you're either stupid and/or blind.
Now that's it's built, I dont want to see City Center fail. Most of these projects, including City Center can and will survive in the long term. Vegas will be back. Mike, I dont need my crack pipe to know that it is the borrowing of money that is the the problem here, not the viability of the projects themselves. If MGM used their own money to build it, they would simply have to suffer through more time before reaching break even, then to profit status. Just like gaming itself, it's just a transfer of wealth. The foreclosed homes will be bought at realistic prices and you can live a decent life in Vegas. Stations can go bankrupt and a Boyd will pick them up cheap.. they'll still be there and still make money, just not as much in a recession and they will in a "normal" market.
Call me old fashion, but I'm like the guy who said he didn't like buildings that looked like they were leaning so much they made him feel like he was stoned...
I know exactly what you mean, LOL!
As far as the environmental types that favor not imploding the Flamingo is concerned, I don't believe there is too much of the old structure left. All of the Villas that were in the back have been gone for at least 20 years.
Other than the name, there isn't much to save or protect that I am aware of. However, that doesn't mean I want to see it imploded.
The Barbary Coast is the Strip in microcosm. I used to really like the place. The dealers were sharp, it was well run, they had all the brass polished, attendants in the rest rooms, floor vacuumed.
Look at it now, its a dump and I haven't even talked about the crummy blackjack and nasty Victorian Room.
Man, have they ever let that place go... Apparently, Harrah's has decided to cut costs everywhere in the way of upkeep and maintenance. It tells me they are letting it go in preparation for the wrecking ball.
i think barbary coast has been nothing more than a place to host the nightclub there.
you are kidding yourself w/ the illusion that this project will be of any significance to vegas, or the state of nevada. just as next months tax revenues are down so will the numbers of travelers flying into mccarran next month. try dropping the price until its down to $29 A NIGHT and see if that helps.
its2hot You have it backwards.Lowden is the liar. She was a repoter at the time and now forgets the facts of the events?If you knew the slightest of facts about the lounge lizard,gold digging Lowden and how she worked her way to the top by hustling big daddy Paul Lowden while he was at the Sahara, the once front man for the Buffalo mob you might see her for what she is. You right wing nut jobs who will say and do anything to promote your lying agenda I'll remind you that you still have an awful mess to clean up with your evangelist,family man, truth sayer Ensign.
Hybrid Vigor Oh how you right wingers like to twist the facts. We don't need history lesson from you about Dubai World. What you need to do is tell the truth. At one time Dubai World was a partner in City Center and then their economy tanked , they got scared filed law suits and eventually quieted down and came back to the fold. By that time additional financy was needed that they could not provide and Jim Murren told you how it was done. So now you have more knowledge of the facts than Jim Murren? Get a life and stop spinning and lying.
Hybrid Vigor By the way where was Jim Gibbons at when the chips were down as well as John Ensign and Dean Heller? Real leadership with the GOP. Two of the three were somewhere with their pants down with someone elses wife all the while telling the rest of us about their value system.
Its just time for Harry Reid and his worthless son to go, period. They are just out for themselves.. When Obama trashed Las Vegas, Reid ran for cover. Only when Obama came to Vegas to stump for Reid did Reid dump all sorts of praise on him.
Makes me want to upchuck.
looking at citycenter wants me want to upchuck.
OMG we have the most negative people in this city! Thanks God for the turists bringing in positive engery. For all of you negative complainers, you should really leave this city ASAP, you bring nothing to the table.