Long rumored but finally official - the Cosmopolitan project, wedged between Bellagio and CityCenter, will open (mostly) in the middle of December.
As the article below says, this is gonna be the last opening for awhile.
Categories: Business of Gaming, Casino Design
Tags: cosmopolitan, lasvegas, vegas
Here's a more detailed release from AP:
This is an interesting phrase, "The resort is going for approachable elegance, ..."
"...redesigned the casino floor to make it extend right to the Las Vegas Strip, putting slot machines closer to sidewalk pedestrians than its neighbors do." Certainly a contrast from Aria and Bellagio, but how significant is it?
"...large outdoor terraces on its guest rooms..." That is different and interesting, although MGM Grand has patios off its Terrace Suites.
"...a sprawling pool complex large enough to host outdoor concerts and sporting events, and a three-story bar that overlooks the front of the casino."
I, for one, am enthused about Cosmo. Hope I'm not disappointed, and I hope it and the other Strip resorts start making money again.
I am excited to see the casino cabanas, the 3 story strip-side bar, and the multi-story pool/club complex. I hope DB doesn't try to open it on the cheap. Once opened, it is too late to upgrade the property.
I don't know anything about Mr. Unwin, but hope he is up for the job because he is being set up as the fall guy if everything goes to hell. It sounds like any potential suitors (hotel and/or casino) are going to wait until after the opening before jumping in.
I thought they couldn't have windows that open in Vegas hotel rooms (except for some grandfathered properties)? or does a balcony door not count as a window?
I think you're going to find that a lot of things at Cosmopolitan will be "multi-story".
This was always my concern with the project. If you want to anything there besides play the slots and tables, you're going to be doing a lot of escalator riding, and I'm not sure how much of the strip walk-in traffic is going to commit to exploring vertically.
It reminds me of an experience I had visiting New York City's Natural History museum last Christmas. For those who've been there it's a sprawling 5-story museum. The first floor was thronged, noisy and practically gridlocked. The second floor was still crowded but navigable. By the time you got to the third floor it was a much thinner crowd. And the 4th and 5th floors? Ghost towns. I thought to myself, if I ever for some reason score an exhibit in the Natural History Museum, make sure it's on the ground floor.
So I hope the verticality of Cosmo doesn't prove to be a similar challenge. I wish it all the best though.
Hooray! More rooms... That's exactly what Las Vegas needs right now.
Serious now: I think this multi level casino will be an issue. This whole project (including City Center) is so anti Vegas that I still have my doubts if they will turn out well. The buildings are true art work when put alone. But I still see CC as a bunch of distorted glass towers put all together in a small area. It is the peak of Las Vegas "manhattanization". Too bad they could predict this recession 5 years ago. Not to say that it is really hard to walk and follow the directions in the complex.
Sorry, I meant too bad they could NOT predict the recession 5 years ago.
I'm new tto his blog and figured I would throw in my .02. Prior to a Vegas visit in March of this year for business, I had been to Vegas 5 prior times all on business. I had enjoyed the city. It was a good place to go for a trade show, but I would never plan a vacation there. That all changed once I visited CityCenter. I have never seen that type of development. The architecture, design and detail blew my mind. I told everyone that they need to visit CityCenter at some point to just marvel at the design and beauty of the architecture. Since that point, I really can't get another trip to Vegas out of my mind. I'm bringing my wife for a long weekend in May. I won't stay at CityCenter because I don't think the hotel operations are ready for prime time and I like other locations better but we will gamble, eat and spend some time at CityCenter as I show my wife. To me all these different themes and styles have a place and CityCenter certainly is a unique draw for Vegas. While I don't plan to stay there anytime soon, it will always be a draw for me to Vegas. Perhaps Cosmo has the potential to do the same. I think variety and unique locations are the key to future Vegas success and both properties add to the unique feel of Vegas.
"Hooray! More rooms... That's exactly what Las Vegas needs right now."
Actually for us locals, that IS exactly what we need right now. Every big and little thing that brings down the second highest unemployment rate in the country helps.
"Too bad they could predict this recession 5 years ago."
Ummm... Even if they could, they probably didn't want to. Anyone who was challenging the notion of "endless, limitless growth for the sake of GROWTH!" in 2005 was laughed off as some overly negative fool. By that point, most of the big Vegas players had become so filled with hubris that they thought they could build anything, ANYTHING!, (think Echelon, El Ad's Plaza, and Viva) and make money.
"I won't stay at CityCenter because I don't think the hotel operations are ready for prime time"
It depends. If you have extra $$ to spend, Mandarin Oriental has been ready for prime time since December. It seems like the Aria Sky Suites are also getting into sync. But if you're looking for more reasonably priced accommodations, then you probably should wait a few more weeks.
"The architecture, design and detail blew my mind. I told everyone that they need to visit CityCenter at some point to just marvel at the design and beauty of the architecture."
Same here. CityCenter would be an amazing architectural marvel for LA, San Francisco, or Seattle... But to have it here in Vegas, it really warms my "postmodern new urbanist" heart. :-)
"I think variety and unique locations are the key to future Vegas success and both properties add to the unique feel of Vegas."
Absolutely agreed. As I've been saying before over here, CityCenter is part of the natural progression of Vegas. We did the Country Western thing. We did the "part Hollywood, part Miami, all mob" thing. We did the "kiddy, kitschy theme park" thing. And now, we've matured to the point where we can handle more original architecture and design like Wynncore, CityCenter, and Cosmo. And obviously, there's a still mostly untapped market in sophisticated urban travelers who will like what they find at Cosmo and CityCenter.
Welcome - glad to have you join us.
I think your comment is very interesting - it's nice to hear someone that excited about CityCenter as we mostly hear the dour and depressing stuff.
I don't know. I have the feeling even though people will be hired to work in these new hotels, other people will lose their job since more properties will have to shut down due to low occupancy. See Circus Circus, Tropicana, Hooters and some other properties in downtown. They simply can't lower more their rates.
Don't you think it is just an illusion to think these new rooms will help to lower the unemployment rate in LV? It seems for every new rooms added, other rooms are forced to close.
I wonder if Unwin (my guess) or somebody at DB had the notion of pushing the casino floor closer to the Strip. It's probably the best idea anybody at Cosmo's had to date.
LeoNYC: The problem there isn't room count or room rates, it's expectations.
I don't think there's a limitless number of rooms you can build on the Strip. The reactionary "whatever happens, happens" attitude Clark County has taken to infrastructure and urban development around the Strip means the roads can't take much more and the utilities are struggling to keep up and some intersections (Wynn/TI/Palazzo, here's lookin at you) smell overpoweringly of raw sewage. We are pushing our limits with what we have, and in theory we could accommodate more but not without major change.
The problem though, really, is the fundamental addition of Wall Street to the gambling industry. Rooms used to exist just to keep people in proximity to the casino. Low occupancy rates simply would be filled up later and weren't too much of a problem in and of themselves. Restaurants existed just to get people in proximity of the casino. Now, everything is like it's own business and is expected to make profits.
Consider that LVS is looking to get out of Bethlehem PA because they're only getting a 13% ROI there. 13% is great in almost any other investment, but investors expect casinos to be a gravy train of prosperity unlike almost any other industry. Investors wouldn't want to give away rooms and make it all on gambling, they'd rather make money at every single opportunity that presents itself.
As Steve Wynn has criticized them for, they don't know how to play the long game.
Honestly, I think room rates being low are a pretty good thing because whatever the customer didn't spend on the room will probably be budgeted for other things once they're actually IN Vegas. Trust me, I've walked around this town while almost broke for a few years, and it's not very fun. It's part of what makes me a cynical grump while everyone else around here is having fun. So once they get here, they're going to buy SOMETHING or they're going to be bored out of their minds.
This is why I think low room rates are a good idea, because they get people out here and that's the most important part. When a person reserves a hotel room, they're still sitting at home, they maybe haven't fully committed to the vacation, and if they see a rate that the feel is uncomfortably high they may decide to call the whole thing off. And when that happens, Vegas makes no money.
It should be interesting to see if DB made any design changes (the original floor plans are posted on VT&T). I still think the strip facing entrance is going to be a mass of confusion; especially now that I've seen the bridges over to PHo and the Harmon.
"Don't you think it is just an illusion to think these new rooms will help to lower the unemployment rate in LV? It seems for every new rooms added, other rooms are forced to close."
Not really. While it's sad to see anyone lose jobs, all in all Cosmo opening should result in a net gain of jobs, like CityCenter has. And with improving tourism numbers (which should improve some more with the Travel Promotion Act now law, throwing the full weight of the U-S-of-A behind efforts to bring more international tourists to Las Vegas), we may not actually be seeing many more room closures (if any) as demand continues to improve in 2010 and 2011.
"The problem though, really, is the fundamental addition of Wall Street to the gambling industry."
Or conversely, it could be said that times have changed and Vegas needs to keep up. The mob is gone, and it won't ever be coming back. Bugsy has really left the building.
"Honestly, I think room rates being low are a pretty good thing because whatever the customer didn't spend on the room will probably be budgeted for other things once they're actually IN Vegas."
Not exactly. Lower room rates attract a different set of customers. We've learned this the hard way... I'm sure you've heard the stories of guests checking into Bellagio with coolers. High-end hotels attract big spenders, and that's why MGM Mirage, Wynn, and LV Sands were all going after them.
One really must be careful when setting room rates, especially if it's a 4 or 5-star resort. What worked for Circus Circus and works for Excalibur doesn't necessarily work for Encore and Aria.
"I don't think there's a limitless number of rooms you can build on the Strip. The reactionary "whatever happens, happens" attitude Clark County has taken to infrastructure and urban development around the Strip means the roads can't take much more and the utilities are struggling to keep up and some intersections (Wynn/TI/Palazzo, here's lookin at you) smell overpoweringly of raw sewage. We are pushing our limits with what we have, and in theory we could accommodate more but not without major change."
Well, I can't disagree with this. It goes back to what I was saying about the success of Henderson with its master-planned communities (and conversely, unincorporated Clark County's past failure in letting developers get away with anything and everything). We just haven't done a good job in keeping up infrastructure and providing what's necessary for about 2 million residents and over 37 million tourists.
Although I question where Mike came up with the "Sands is unhahppy with 13% ROI at Sands Bethlehem" statement (I think that is good anywhere if it is properly accounted for), I agree with him that low room rates are a positive for Las Vegas.
I think a true number to maintain a room is $8.00 per day and utilites are $7.00 per day, which equals $15.00 per day. If I take that amount, as well as square footage debt serivce, and place it against the daily revenue of the casino floor, I can show a low EBDITA, while still making money. Study some of the publicly traded casino financials and you will see much of their losses are paper losses based upon their valuation of an asset in 2007 as compared their valuation in 2010.
My most basic point being that I can make money off you the more time I can get you into my casino/resort.
"I think a true number to maintain a room is $8.00 per day and utilites are $7.00 per day, which equals $15.00 per day."
This depends on the hotel. If we're talking about Circus Circus, you're probably right... But I suspect it's more for Mandalay Bay. Also remember that other costs have to be factored in, like maintaining the pool area.
"low room rates are a positive for Las Vegas"
Really? Again, I don't think this can be applied to all casinos. Sure, a low room rate is good to entice low rollers to grind joints like Excalibur and IP. But for a higher-end casino, it may not help to have rates too low. Again, they don't need guests staying in their rooms with coolers full of food and drinks from the grocery store... They need the type of guests who don't hesitate spending money on "the finer things in life": great restaurants, haute fashion, and (of course!) pricey table games. And no, these guests aren't interested in grind joints.
This is why higher-end casinos have had to walk a tightrope in the last 2 years in offering discounts to keep the hotels as full as possible... While not taking the ADRs "too low" to risk replacing any high-roller regulars with low-roller "grind joint regulars".
atdleft posted: "Or conversely, it could be said that times have changed and Vegas needs to keep up."
All I'm saying is that Wall Street is not accustomed to failure, and it carries very little risk for them since market losses tend to be socialized.
Casinos aren't a typical business. For one thing, they're a political hot potato and few people feel a need to preserve them or what they do. I mean, people in Washington were opposing the HSR line because they were concerned that our casinos would benefit from it. In other words, nobody feels sorry for them. So they're not going to be able to borrow money from the government at no interest like a bank can, and they're not going to get a bailout or public subsidy if they risk collapse like a bank or some other major industries can. And yet the people who don't run casinos off in the financial world often have banking-sized expectations on profits, and they're going to have to come back down to reality and have more reasonable targets or else the resorts are going to scare all their customers away trying to make expected margins, because people don't like feeling screwed.
"Bugsy has really left the building."
Man, if only this board had a private messaging system. Bugsy isn't here anymore but he definitely has had some long-term effects, but unfortunately I don't feel right talking about it on the record.
"What worked for Circus Circus and works for Excalibur doesn't necessarily work for Encore and Aria."
I don't think an RV park would work for Encore and Aria, but Aria has as many rooms as Excalibur, more on-site restaurants that it needs to fill than Excalibur (and many are owned by the resort itself, not chains like Dick's or Baja Fresh), has many more stores than Excalibur whose tenants need customers or else they will pack up and leave.
Aria has a lot more cash registers running at once than Excalibur and has about as many people upstairs (although Mandarin and Vdara help, too.) I would honestly expect Aria's bottom line to be a lower percentage room rate profit than Excalibur's simply because there's so many other things going on.
Notice I said as a PERCENTAGE. I don't mean that Aria should be as cheap or cheaper than Excalibur, but they should probably rely less on room rates for their bottom line than Excalibur does since they have so many other ways to make money.
In fact, I imagine that Aria should be giving more comped rooms and discounts than Excalibur since rooms are just a part of their formula. Excalibur has rooms and gambling and then suddenly all that's left is some minor shops and a buffet. There's no real mall, only two non-outsourced dining options (cafe and buffet), some small part-time worker attractions like the boardwalk games, no real nightclub. Room revenue is a much bigger part of their formula than Aria.
"This depends on the hotel. If we're talking about Circus Circus, you're probably right... But I suspect it's more for Mandalay Bay."
Which hotel company was it that was teaching housekeeping to work 33% faster? I think it was Harrah's? All I know is that somebody out there, and I think it was Harrah's but maybe not, was boasting that they were teaching their housekeepers how to finish a room 33% faster than they were before. Which means that they get more rooms done in an hour, which means that the cost per room is about 1/3rd of what it used to be.
This has repercussions maybe if guests find crumbs and dirt or worse, but here we are again with turning customers off in order to hit the numbers demanded for by the guys in accounting.
"they don't need guests staying in their rooms with coolers full of food and drinks from the grocery store"
I'm more likely to do this if I've spent more on a room than less. Lately I've been trying to decide between a Mirage Tower Suite or a Bellagio Salone Suite or an Aria Corner Suite if I decide to splurge in the future, and I'll probably eat less at resort dining than I did a few years ago when I staycationed at the IP.
"Casinos aren't a typical business."
True... But then again Wall Street sometimes behaves like a glorified casino, so they have more in common then you'd initially think. And actually, I agree with you that Wall Street shouldn't be expecting the type of insane profit margins that casinos earned in the 1990s. Vegas has matured, and we can't count on the same kind of insane "growth for the sake of growth" now that we're almost done growing out.
"but Aria has as many rooms as Excalibur, more on-site restaurants that it needs to fill than Excalibur (and many are owned by the resort itself, not chains like Dick's or Baja Fresh), has many more stores than Excalibur whose tenants need customers or else they will pack up and leave."
But that's just it, the quality of the rooms and amenities at Aria is much higher than those at Excalibur. That's why operating costs at Aria are much higher than at Excalibur. Excalibur may be able to get away with $30 room rates, but Aria can't... And probably even $60 rates wouldn't be enough to cover its costs (including its debt).
"All I know is that somebody out there, and I think it was Harrah's but maybe not, was boasting that they were teaching their housekeepers how to finish a room 33% faster than they were before. Which means that they get more rooms done in an hour, which means that the cost per room is about 1/3rd of what it used to be."
Yes, it's Harrah's... And wait, isn't Harrah's always criticized around these parts for being so cost-conscious to the point of letting its hotels decay (a la Rio)? As we've seen with hotels like Rio, a casino operator risks losing prestige (and high-rollers and big spenders, with all the revenue they bring) by cutting costs to the point of downscaling a casino.
And that's just it, it's not just about the room rates bringing in profits themselves... It's also about the room rates creating the perception of luxury and prestige (or conversely, affordability and humility). That's what MGM Mirage has been so successful in doing at Bellagio, and what I think they're trying to repeat (so far, not as successfully) at Aria.
High-rollers want an exclusive gaming environment. Gourmands want fine restaurants with the finest food and drink. Shopaholics want all the big designer name brands. And NONE of these groups want to rub elbows with "Joe Six-pack & Jane Fanny-packer" carrying the cooler into the room before hunting for penny slots and a cheap buffet.
Again, higher-end casinos have had to lower their ADRs to keep the hotel rooms as full as possible... But they can't risk setting the ADRs so low as alter their target market and scare the big spenders away to make room for low-rollers. Grind joints like Excalibur and Circus Circus need not worry about their reputation, but Aria and Bellagio do.
But they have methods of keeping Joe Six Pack away from the Out Of My Way crowd. They have exclusive check-ins, they keep the fancy restaurants more or less in one or two areas (Aria does this, Wynn does to a large extent), table games are kept together and not amongst the slot barn and the expensive tables are cordoned off entirely.
There's no classist aspirations here. They are giving the perception of a smaller hotel by shuffling the elites into their own corners so they can be with each other, while simultaneously making sure that the "bottomfeeders" aren't hindered by having to get around things that aren't for them.
Let's face it, a high limit room accomplishes two objectives: It gives high limit players a refuge of their own and keeps everybody else from stumbling into an area where they need not be.
I don't know how many times I keep saying that they don't build hotels with 3,500+ guest rooms exclusively for the Robb Report crowd. There is always a harmony.
"Let's face it, a high limit room accomplishes two objectives: It gives high limit players a refuge of their own and keeps everybody else from stumbling into an area where they need not be."
And let's face it, if we look at "the big picture", that's what MGM Mirage and Harrah's do with their casinos. With Total Rewards, Harrah's has mastered the art of channeling all their various gamblers into all the "right places"... The heavy low-rolling slot players get comped for Harrah's rooms and buffets while the Seven Stars high-rollers (basically, their members who don't hesitate to make seven-figure baccarat and/or poker bets) get comped for Caesars suites, Forum Shopping Sprees, and dinner at Guy Savoy.
Now while MGM Mirage isn't (at least yet) micromanaging its players' club like this, it does have its own tiered system of casinos to channel its players into: Circus Circus for cheapo families, Excalibur & Luxor for cheapo party kids, Mandalay Bay for party kids with "bigger allowances" and expense account conventioneers, Bellagio for the bigger high-rollers.
"I don't know how many times I keep saying that they don't build hotels with 3,500+ guest rooms exclusively for the Robb Report crowd."
No, most of the 3,500+ guest rooms are for the "desperately trying to climb the social ladder to impress the Robb Report" crowd while the uber-exclusive tower suites cater exclusively to the Robb Report crowd. Neither sector would rather see or deal with the "Joe Six-pack/Jane Fanny-packer" crowd... So Harrah's & MGM Mirage channel them over to Excalibur or IP instead while LV Sands & Wynn don't even bother with them, and Boyd & Station do whatever they can to suck every last penny out of them.
RJ got access to Cosmopolitan and reports on it today. The outside room terraces wil be a draw, but they make me nervous. It seems every year, we read about spring break college kids falling from hotel balconies after too much to drink. I hope we don't see anything like that at Cosmo.
I've always thought the outside balconies at Cosmo were a bad design because of privacy issues (and safety). I can just see drunken idiots jumping over the short rails (I think that's possible from the drawings I saw)and walking between the rooms on the balcony "just to party" with friends, but violating other people's privacy by looking in their window.
Excellent RJ piece. It should be really interesting to see how the foot traffic flow works out. I noticed a lot of people really sucking wind on the west side overpasses that have stairs. Wait until it is 110 degrees outside.
Uhm, atd, you understand that Bellagio has quarter slots, right? And that Wynn does, too? I mean, when I first started gambling in Vegas I was pretty thrilled to see those penny video slots near the north entrance simply because I expected that I wouldn't be able to do bupkis at Bellagio, but the reality is that a lot of the image of these resorts is just that. Image.
I'm not sure who the lower-class of customers we're making fun at this point are, since I don't know who is priced out of the class on quarter slots making fifty cent bets. Maybe some of the bluest of blue collar folks at the ElCo and Western, but that's about it.
The Cosmo's manager's last name being Unwin seems unfortunate.
"Uhm, atd, you understand that Bellagio has quarter slots, right? And that Wynn does, too?"
And do you understand that Luxor has a high-limit room? And so does Harrah's?
It's standard practice for a casino to offer "something for everyone", but Bellagio and Wynn aren't as dependent upon penny machines for its bottom line as Luxor and Harrah's. That's my point.
Aria and Cosmo are targeting a different segment of the market than Luxor and Harrah's, so it doesn't make sense for them to use the same methods to attract customers that the low-end grind joints use. Again, they're after a different segment of the market.
"I'm not sure who the lower-class of customers we're making fun at this point are,"
I'm sorry if it seems like I'm being cruel. That's not my intention. I'm just trying to explain what the casinos are doing. And btw, these low-roller customers are the folks I regularly find playing the machines at Harrah's, or partying at Dick's at Excalibur. They're not into the "fru-fru" luxury of the high-end resorts, and they'd rather not pay those high-end resort prices.
And btw, this is why I'm more skeptical about Phil Ruffin's plans for TI. If he really wants to make TI his own grind joint, he can't get away with charging the kinds of prices he's putting now in his restaurants, bars, and spa.
"It seems every year, we read about spring break college kids falling from hotel balconies after too much to drink. I hope we don't see anything like that at Cosmo."
True. There's obviously a reason why most Strip hotels do NOT offer balconies. I just hope they do their best to make those balconies as safe as possible. I'd rather not be reading a bunch of spring break horror stories this time next year.
"Excalibur & Luxor for cheapo party kids, Mandalay Bay for party kids with "bigger allowances" and expense account conventioneers"
So MGM sees me as a party kid...it all makes sense!
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