April 29, 2008

Space battle: Wynn is gearing up for the next round of building more stuff

By STEVE FRIESS

You could almost hear the Yiddish expletives emanating from the executive offices of one Sheldon G. Adelson last week when somebody over at Las Vegas Sands brought him the news. I mean, assuming someone had the guts to do so.

In an interview late in April following his decision to can Spamalot in favor of Danny Gans, Steve Wynn startled me with this big reveal: He’ll build not only two more hotels on the massive acreage that is the Wynn Golf Course, but also—wait for it—a 1.5-million-square-foot convention center.

That’s a whopper of a big deal. It’s bigger—by 300,000 square feet—than the current Sands Expo and Convention Center next door. Plus, since Wynn’s land stretches all the way to Paradise, it means the Wynn Convention Center (as it will inevitably be christened) will have a special kind of synergy by dint of being kitty-corner from the 2.2-million-square-foot Las Vegas Convention Center.

It also means that Wynn, who many thought was losing his guts when he went with the has-been Gans as his face of the future, still has plenty of whoop-ass left in him.

Yes, he’s going directly into the heart of Adelsonville.

Adelson, already looking a bit bruised and bloodied from his cringe-worthy witness-stand performance defending against a lawsuit over how he got the Macau gaming license that made him one of the world’s wealthiest people, could not have been pleased by this obvious aim at his jugular by his arch-nemesis.

Prepare for battle. With Adelson already having announced he’d rebuild the Sands Convention Center bigger and more modern to the east of its current spot so he could add yet another 7,000 hotel rooms, too, we’ve just been promised at least another decade of the greatest free spectacle in Vegas history. God, this town is never boring.

Yet as entertaining as it is to watch colorful billionaires try to one-up each other, my first question when I hung up the phone with Wynn was: Does Vegas really need another convention center? Or, for that matter, any more meeting space?

The amount that exists in this city is already staggering. There’s hardly a major hotel-casino without at least a few hundred thousand square feet of convertible ballrooms and such, with Mandalay Bay boasting a 1.8-million-square-foot center itself. More will come with Echelon, with CityCenter, with Station’s Viva project on West Tropicana.

What do I know? Evidently, the more the merrier.

“Obviously, there’s a lot of convention space in Las Vegas, but Las Vegas has done a tremendous job stealing a lot of conventions from cities that have historically been big convention destinations,” said Robert LaFleur, a gaming-stock analyst for Susquehanna Financial Group.

Indeed, the city now hosts 45 of the nation’s 200 top trade shows, more than Orlando and Chicago combined, and they’re No. 2 and No. 3 after Vegas. Deutsche Bank gaming analyst Bill Lerner said that, given the enormity of those events and how many are already here, the only way to poach even more of the top 200 would be to add another mammoth convention space.

It could also help make negotiations more even between the private convention centers and major conferences. Earlier this year, Consumer Electronics Show officials bemoaned the high price of hotel rooms and appealed to Adelson to offer lower rates. Adelson, whose Sands Convention Center has co-hosted the city’s biggest trade show for years, shrugged and noted that CES has no place else to go. Now they might.

There could also be a downside, though.

“New space in the city is a good thing and a bad thing,” said Chris Brown of the National Association of Broadcasters, whose April convention brings more than 100,000 attendees each year. “It’s a good thing in that it promotes additional competition, but with so many space options, it’s very difficult to control and manage what’s happening around your event. It becomes easier for a co-related event to jump into the space next door and set up a counterproductive competition.”

So let the battle lines be drawn. Not to beat a dead horse, but this development is further proof of how inadequate the Christina Binkley book, Winner Takes All, was by ignoring Adelson’s impact. While Binkley has defended that by saying that Adelson’s all built out in Vegas (guess not, huh?) and really wasn’t that innovative anyway, Las Vegas history has been and will continue for the foreseeable future to be in large part the result of the deliciously twisted Adelson-Wynn pas de deux.

The scary part is that in the end, this could also put Adelson and Wynn on the same side of a battle royale with the Las Vegas Convention Center. Adelson has long complained that it’s unfair that his private convention space must compete with the publicly subsidized one. It’s unnecessary in a city like this, Adelson has argued.

Will Wynn line up behind Adelson on that? Wynn seemed almost uncomfortable at the prospect.

“I don’t think I have an intelligent response to that question yet,” said Wynn of a matter that has been in the news for many years. “We just know we have the land at no cost, and we would like to build another 5,200 rooms to take us to 10,000 on our property. And we want to have our own 1.5 million square feet of exhibit space in the middle.”

Of course, should the MGM Mirage folks think they’re immune, they best beware. Also planned for the golf course land is “a lake twice the size of the Bellagio with the water and special effects.”

And you thought Wynn was yesterday’s news, didn’t ya? As that song from that unfunny show he’s about to replace with that unfunny impressionist goes, he’s not dead yet.

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