Two Way Hard Three | Las Vegas Casino & Design Blog

May 2, 2010

Vegas Gang #46 - April 30th, 2010

Posted by Hunter

Win an iPad! Details here: There will be a live broadcast of some sort to award the prize on Thursday. Look for details here on the blog in the next few days.

NOTE: This recording got screwed up somehow and we lost a segment of the show. Apologies to my fellow panelists and to the listeners. We salvaged what we could. Enjoy.

* Wynn Resorts Discussion (partial)
* MGM Mirage Name Change
* Boyd / Station Drama Continues
* Taking Photos In Casinos / New Luxor Policy

Feel free to leave your comments below. If it's a question that you want asked on the show, please make that clear in your post. You can also send those to

NOTE: We recorded an updated segment on Wynn in Macau, plus Marina Bay Sands:


Read archived comments (15 so far)
May 2, 2010 3:49 PM Posted by atdleft

I'll listen when I get home. I can hardly wait! I've been without my Vegas Gang fix for far too long. :-p

May 2, 2010 4:04 PM Posted by Paolo

I don't really think the MGM name change is all that strange- in fact, I think it makes a lot of sense in a few ways. Your conversation was framed by how other casino companies have done name changes in the past, but I think that discussion is looking at things too narrowly. A while back, I heard MGM was thinking about expanding their hotel empire worldwide by managing non-gaming properties and licensing their name. Of course, this was all pre-recession talk, but it doesn't mean it's not still in the long-term plan. If they are planning to use the MGM Grand name for their international expansion, it makes sense to name the company that and drop the Mirage name. Mirage was acquired by MGM- and outside of the casino industry, it is typical to drop the name of the company that was swallowed up. I sort of get the feeling that MGM is positioning themselves to become a worldwide hotel/hospitality company, with gaming amenities in select markets (as opposed to a pure gaming company). If that plays out, then MGM International fits.
Or maybe Kirk Kerkorian just didn't want it named any other way.

May 2, 2010 4:54 PM Posted by atdleft


I think you're right on the money here. As I've been saying repeatedly here, MGM execs see MGM Grand as their flagship brand, NOT Mirage or Bellagio. Whether or not we agree with the logic of that, they've chosen MGM Grand as their go-to brand when expanding abroad.

And yes, it's become increasingly obvious in recent years that MGM isn't content inbeing "only" a gaming company... They want to be a major hospitality heavyweight akin to
Hilton, (Sodexho) Mariott, and Starwood/Sheraton. While most of this is on hold because of the recession and CityCenter, they're guaranteed to restart this long-term plan as soon as they're on more solid financial footing.

May 2, 2010 5:17 PM Posted by Hunter

One interesting note:

The current incarnation of MGM Grand, Inc. existed since about 1991* when they started work on the current MGM Grand. MGM Mirage was born in 2000 as a result of the merger.

Funny to see which name was on the letterhead longer.

* Yes, of course there was a previous MGM Grand hotel.

May 3, 2010 3:22 PM Posted by Kenny

When Kerkorian built the first MGM Grand (now Ballys), what was the name of his company?

May 3, 2010 3:38 PM Posted by Hunter

Oh, I'm sure it was something MGM derived, no doubt.

The company sold its assets in the mid-80s and went into hibernation mode until the current MGM Grand was developed in the early nineties.

Really my point was just that they've been MGM Mirage for a long time now. Time flies.

May 3, 2010 4:05 PM Posted by mike_ch

I don't know what the confusion is. "MGM Grand" is the company's workhorse name. It's a name they can take into Detroit, Macao, New York, London, Florida or Sydney and people would know what that is.

It's recognizable, but not so much so that it sets expectations. MGM Grand in Vegas isn't the greatest hotel on the Strip by almost any measure (except five-star dining, I guess) but that's okay because if it carried too much prestige then they couldn't use it around the world.

The most valuable brand they have in terms market value and prestige is Bellagio, yes, but what can they do with that? I heard a Hong Konger once spin rumours about MGM bringing NYNY and Bellagio to Macao, and I had to suppress my desire to laugh while telling him that I wouldn't bet on it.

Realistically, even Steve Wynn couldn't really afford Bellagio even though he did pull it off. He was building it with the enthusiastic money of investors who were confident in him. I felt Lanni and Murren were doing a lot of this at MGM as well.

At Wynn Resorts, Steve has controlled much of the stock until now and so he has always been mostly investing his own money. That means no meticulously detailed broom closets and themed tour bus terminal basements like at Bellagio. He isn't going to build something he wouldn't be prepared to pay for.

We can have another go round of how the company would like Aria to eclipse Bellagio as their premier offering, but that doesn't change the fact: There will only really ever be one Bellagio, because it is extravagant beyond all reasonable fiscal restraints. MGM teased putting the name on a Dubai non-gaming property in 2008 and then never talked about it again (reminds me of THEresidences in front of Luxor), but there's no way that even if it did happen that the truly observant wouldn't feel somewhat dissapointed.

Steve was bonkers to indulge so recklessly in frills and ornamentation. So long as busimessmen actually care about getting out of the red, we'll probably never see something like it again. Certainly not here, because if it does happen it's going to happen with a significant government support when some country tries to build it as a tribute to their own pride.

May 3, 2010 6:43 PM Posted by atdleft

Mike C-

"I don't know what the confusion is. "MGM Grand" is the company's workhorse name. It's a name they can take into Detroit, Macao, New York, London, Florida or Sydney and people would know what that is."

How very true, and I'm glad more folks are seeing this. MGM Grand is a recognizable brand, and (for better or worse) it's the chief brand MGM uses when expanding abroad.

"It's recognizable, but not so much so that it sets expectations. MGM Grand in Vegas isn't the greatest hotel on the Strip by almost any measure (except five-star dining, I guess) but that's okay because if it carried too much prestige then they couldn't use it around the world."

Not exactly. MGM Grand Skylofts is a "creme de la creme" uber-luxury "hotel within a hotel" akin to Wynn Tower Suites. Joel Robuchon is the ONLY Western US restaurant outside the San Francisco Bay Area to achieve 3 Michelin Stars. The Mansion is famous for its ultra-high-roller gaming.

The key to MGM Grand is variety. It has the ultra-high-end amenities for the ultra-high-rollers seeking them, and it has more down-to-earth offerings for the more average tourists. MGM Grand may be to MGM Mirage/soon-to-possibly-be MGM Resorts Intl. what Macy's is to Federated Department Stores: a "something for everyone" kind of place that covers a wide array of price points and customers.

"There will only really ever be one Bellagio, because it is extravagant beyond all reasonable fiscal restraints."

True. Bellagio is just something that can't be properly replicated. That may be another reason why MGM Mirage would rather not make Bellagio its flagship brand. It just can't be easily exported into other markets like MGM Grand can.


"Really my point was just that they've been MGM Mirage for a long time now. Time flies."

But what if they sell The Mirage? I know, I know, MGM execs are still denying it. And I still can't buy their denials just yet.

Now the worst is definitely over for the company, as they no longer look to be on "corporate death watch". However, they're still not in the position yet to buy Cosmopolitan... Unless they raise some capital ASAP. If MGM is still interested in buying Cosmo to integrate it into CityCenter, I wouldn't be surprised if they finally let go of The Mirage. It would be AWESOME (!!!!) if Steve Wynn were to reconsider investing more in Las Vegas and retake his "firstborn" Strip casino to restore it to its former glory...

But I'm not holding my breath over that pipe dream. As I suggested in a previous thread, it's probably more likely that Phil Ruffin, Colony Capital, or Harrah's would pick it up than Wynn.

May 3, 2010 7:08 PM Posted by Hunter

If I was a shareholder and I found out that they went to the expense of changing the name of the company because they were *considering* selling a property (which they categorically deny)... I would be pretty upset.

This topic really isn't very interesting beyond the gossip angle.

And no... I don't think they want Cosmo. They have enough mid-Strip rooms to fill as it is. I'd guess they want more China... just like any other sane operator these days.

If Wynn buys The Mirage in the next year, I'll get the purchase price as a tattoo. Not. Gonna. Happen.

May 3, 2010 7:37 PM Posted by detroit1051

Kirk Kerkorian's original corporation was International Leisure, but I'm not sure whether he built the original MGM Grand (now Bally's) privately or not.

The current MGM Grand is an interesting property with everything from low-end to high-end appeal. Charlie Trotter was one of the first celebrity chefs in Vegas, but his great restaurant at MGM Grand didn't last more than a couple years. It then became Great Gatsby's and is now Nobhill Tavern. Emeril's was another pioneer at MGM Grand as was Wolfgang Puck.
Everyone world-wide knows the names MGM and MGM Grand , and imo, the corporate name should be MGM Grand, Inc. MGM Resorts International doesn't carry the same recognition and for many brings back memories of the loser brand, Resorts International.

May 3, 2010 7:47 PM Posted by detroit1051

I can't imagine Steve Wynn buying The Mirage, even though it has a lot of property. Wynn already has the golf course acreage which will likely remain green for years to come (as discussed in the latest Vegas Gang.) The Mirage would only work for Wynn if the rooms were combined to create a boutique hotel, but how would half the rooms (1,500) be profitable, especially considering that all the growth potential is in Macau?

May 3, 2010 9:46 PM Posted by mike_ch

Wynn won't buy Mirage, sorry.

I think Ruffin probably has sine right to first refusal. Remember he is not only under a deal for the tram but also paying The Mirage for his parking garage.

I suspect the Ruffin deal was some friendly bargain where MGM had Tue possibility to buy it back if things improve (giving Ruffin what he wants most, a profit) or allowing him to be first bidder if Mirage was sold. He wouldn't want Mirage to go to someone who would try to cripple him.

My ideal operator for Mirage would actually be LVS, but since that seems unlikely I would not mind Harrahs. They need to drop Rio first, though.

May 4, 2010 10:06 AM Posted by Eric

Great podcast, guys. Couple of comments.

Regarding MGM's name change, I agree with posters above that it makes a lot of sense. In the first place, everyone refers to the company shorthand as "MGM" anyway, and it's already their stock ticker. It gives them the freedom to sell of the Mirage sometime in the future, even if that's not in their immediate plans. Maybe it's a little bit of childish "we don't need any reminders of Steve Wynn" as well, but it makes sense to me. Not sure why they want to spend the money to do it NOW, but "MGM Resorts International" probably reflects the future direction of the company better than "MGM/Mirage."

Secondly, the point about photography in casinos. Luxor is unique in that so many of their hotel rooms are visible from the atrium/casino. I never really considered that before. But that does seem to provide a valid "protect the privacy of our guests" argument for disallowing photography property-wide. Most hotels wouldn't want you taking pictures of their room hallways, for obvious reasons.

Like you guys, I can't figure out why they threw Excalibur in with this new policy as well. Is there a single management team that runs both Excal and Luxor? Maybe that's why, they want the policies to be the same across both properties?

As far as I can tell, Luxor's unique in the room arrangements. Are there any other Vegas (or other) casino hotels where a large number of guest rooms are visible from the casino and/or other common areas? I sure can't think of any.

May 5, 2010 10:31 AM Posted by CK from KC

Conspiracy theory on the photo restrictions at Luxor/Excalibur: They are going to let their rooms go even more downhill and don't want people posting new photos of dilapidated conditions. Though they wouldn't be able to monitor that anyway, they are just trying to dissuade photo-taking of declining properties. My shock is that Circus Circus doesn't have this policy as well.

May 5, 2010 10:51 AM Posted by kagehitokiri

"Deutsche Bank owned this thing. They were stuck building it," Murren said. "We would have the joint venture buy it, button it up and shut it down. We would make it phase two of CityCenter, whenever the market decided the time was right."

He thought Deutsche Bank would jump at the deal because the bank would gain ownership in CityCenter.

"Instead of cash, Deutsche Bank gets a big piece of CityCenter," Murren said. "And they lend me $1.2 billion rather than put another $2 billion into the Cosmopolitan. They lend money to a vastly better project and they get out of a nightmare they don't know how to manage."