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Reading those comments somewhere in MGM Mirage’s posh corporate offices at Bellagio, Murren may just release a primal scream.
“What we were trying to create was not just another resort, not just another mall, but an urban environment that doesn’t exist here, and to create the energy and the interest and real urban planning and be thoughtful about parking and vehicular circulation and pedestrian circulation and parks and open spaces and an art program and world-class architects was very intriguing,” he says.
“I think people around the world, particularly those who have visited great cities, will be very intrigued by this because it is in microcosm a very ambitious master-planned community.”
Again, though, willingly inviting direct comparisons with New York or other urban centers may be asking for it from critics like Dave Hickey, the vaunted pop culture observer and MacArthur Fellowship “Genius Grant” recipient who teaches at University of Nevada, Las Vegas.
Noting that there’s no grocery store anywhere in CityCenter — MGM Mirage failed to persuade Whole Foods to open at the Crystals — he wondered if Murren has forgotten that “urban living is about having everything and anything close at hand. When I lived in New York, I lived steps from the cleaners. They may be talking about urban living to a level to which you and I cannot aspire, for people who can call out for groceries and never need a magazine or stick of gum.”
Who will actually live in these buildings remains an open question, in large part because of the implosion of the economy, the freezing of the credit markets and the precipitous drop in the value of real estate across the Las Vegas region. Units in the various towers cost a minimum of $500,000 and top out at $9 million, and as recently as May the company defiantly insisted it wouldn’t reduce them. Then, in October, facing a revolt from prospective owners, MGM Mirage announced a 30 percent price cut and efforts to help secure loans even if the company itself has to behave as the lender.
Even Murren acknowledges, “The residential part already went very wrong from its original economic proposition.”
But in the long run, he is convinced that not only will these condos be viable second homes for the jet-set class but also primary residences for childless locals “who will live on the Strip, in and around the Strip, who have nothing to do with the gaming industry other than that they want to be around it instead of having a house in Summerlin, where they have to pay someone to cut their grass.”
Is It What Tourists Want?
Everything new in Las Vegas comes with the same promise from its creators, that it will “grow the market.” That’s wonk-speak for drawing new tourists who wouldn’t have considered coming before.
Wynn delivered on this promise three times in his career: when he opened Mirage in 1989 and brought in a mainstream audience; when he opened Bellagio in 1998 and made the Strip interesting for the upper class; and when he opened Wynn Las Vegas in 2005 to tap into an even more exclusive, elusive grade of wealthy travelers.
It is, too, the vow issued by MGM Mirage with CityCenter. It would be easy for Murren to predict, as he does, that the number of tourists will rise 7 percent in 2010 and to simply attribute that to both curiosity among Vegas lovers yearning to see something new and an inevitable economic rebound in which the miserable data of 2009 are easily improved.
Murren goes much further out on a limb, though: “The people of the world have heard of this project. They’ve heard of Rafael Vinoly and Cesar Pelli and Norman Foster and Daniel Libeskind, and they’ve stayed at the Mandarin. They are multibillionaires, centimillionaires, some of the wealthiest people in the world, people who are doing business in Abu Dhabi, Cairo, Mumbai. People have heard of this, new people who don’t come to the Bellagio or the Venetian or the Wynn.”
LaFleur is baffled by such boasts. He’s willing to grant Murren his 7 percent growth, although he also predicts that average room rates — already 25 percent lower in 2009 than in 2008 — will continue to drop, as CityCenter adds another 6,000 hotel rooms to a market that already has 141,000 it can’t fill. But who, he wonders, didn’t already know Las Vegas existed?
“It is no great secret that Las Vegas exists in the southwest corner of the state of Nevada and that there’s quite a sufficient number of high-end hotels, and that you can go there and buy a nice Rolex and have a steak dinner,” says LaFleur, who this fall downgraded MGM Mirage stock.
“At the end of the day, the product is the gaming experience broadly defined. There’s nothing unique in the product offering. People don’t go to hotels because of the architecture of a hotel on a recurring basis. You go to a hotel because you like the hotel, you like the service, you like the ambience.”