The new visionary CityCenter may be the sparkling future of Las Vegas
It's a Friday night on the Las Vegas Strip. All things appear to be as they should. Steve Wynn's twin monoliths slice the sky. The Palms logo sizzles in the distance. Caesars Palace beckons as it has for decades. A volcano erupts at the Mirage. Waters fronting the Bellagio do choreographed dance routines. And pirates parry swords on a big ship in front of Treasure Island.
Then you make your way to the spot where Harmon Avenue meets Las Vegas Boulevard. This is ground zero for CityCenter, MGM Mirage's recently completed, $8.5-billion hotel/casino/condo/retail complex. On the high wall of Crystals shopping mall, running parallel to the sidewalk, lights sparkle in the patterns of Louis Vuitton logos. Behind it, six towers stand in a curvy, glassy, sharply edged cluster. It looks more like Shanghai's instant high-rise neighborhood of Pudong than anything you'd expect to find in the sprawling Southwestern United States.
Compared to the rest of Vegas, the buildings of CityCenter may as well be a battalion of alien spaceships, freshly landed on the Strip. Located in a place that defines itself through unique designs and outrageous spectacles, CityCenter ranks as the most unique specimen in years. Ultra-modern and sleek, the so-called city-within-a-city skews your view of what Las Vegas can look like and feel like.
Previous resorts here have been all about expansive facades, airiness, and loads of empty spaces that add up to convey a sense of luxury. No less a visionary than Steve Wynn has touted expansiveness as an ultimate amenity. CityCenter, living up to its name, is intentionally dense, with its Manhattan block's worth of shimmering structures on acreage that approximates Bellagio's. Starchitects possessing international pedigrees designed the buildings-classic casino formulas were tossed out the window. When you stand on a CityCenter overpass, where cars below zip to and from the Strip, it's easy to imagine that you have stepped into Las Vegas's future-albeit, one that is fraught with uncertainty at this economically fragile moment.
Bill McBeath, the sharply dressed president and COO of CityCenter's Aria Resort & Casino, likes to tell a story about his first meeting with Cesar Pelli, the renowned architect who went on to design Aria. "He told us right up front that he doesn't do Vegas," says McBeath. "We said, ‘That's good because we're not doing Vegas either.' "
While CityCenter boasts two hotels (ultra luxe Mandarin Oriental and Aria), a condo-hotel (Vdara, where the rooms feel more like small apartments and are for sale at 30-percent off 2007 prices), a pure condo called Veer Towers and another partially completed hotel (the problem-plagued Harmon), there is just one casino to accommodate all of their players. Bobby Baldwin, CityCenter's president and CEO and a gambling man to the core, explains that this is by design.
He maintains that the single gaming space, inside Aria, is all that City-Center requires. "If you have the right casino, you need only one," Baldwin says, speaking in a somewhat dismissive tone, as if he's already had this discussion too many times. "Part of the appeal of the Mandarin [just a five-minute walk from Aria's front door] is that it does not have a place to gamble. And if the hotel did have one, it would be too small to be successful."
Despite its limited gaming options, CityCenter stands as the most audacious project ever undertaken in Las Vegas. It came in $1.2 billion over budget (thanks, partly, to a rise in global construction just before the crash, which caused material costs to spike) and qualifies as the largest privately funded development in U.S. history. Shopping mall Crystals sets its agenda with the fifth-largest Louis Vuitton store in the world, a Tiffany duplex and a nightclub/restaurant owned by the actress Eva Longoria Parker. All of this seemed ambitious back when Vegas was booming but came to seem suicidal after the bust settled in. Early last year the project tethered on the brink of insolvency, following a temporary pullout from ill-fated business partner Dubai World. That and other financial issues led MGM Mirage to unload its Treasure Island property in order to make ends meet.
Jim Murren, the former Wall Streeter who now serves as MGM Mirage's chairman of the board and CEO, describes last year as "the most challenging of my career." He acknowledges that at one point he feared the entire MGM Mirage company going bankrupt on his watch. "But that situation made the second half of 2009"-when things fell into place for CityCenter-"the most gratifying of my career." Tens of thousands of jobs hung in the balance, and, rightly or wrongly, Vegas residents viewed CityCenter as a make-or-break proposition for their collective future.
Right now, with the project completed and the worst fears allayed, MGM brass expect big things from CityCenter. Competing fat cats around town, of course, take more jaundiced views. In the throes of the Vegas downturn, on the eve of Aria's opening, restaurateur Paul Bartolotta publicly wondered if the city really needs 4,000 more rooms and a new fleet of upscale restaurants. Vegas arriviste Donald Trump categorized CityCenter as "a catastrophe;" Murren fires back by describing Trump's single Vegas property as "a popsicle stand." Steve Wynn, who clearly has more credibility than The Donald, isn't sure why a project like CityCenter even exists on the Strip. Same with Wynn's archenemy Sheldon Adelson, who wondered "Why would people want to go to New York in Vegas when they can go to New York?"
Though a similar conclusion could be reached about Adelson's signature Venetian property, folks at MGM would argue that it is not supposed to be another New York but a more sophisticated Las Vegas. "A couple weeks ago we had the President of the United States here," remembers Murren. "He personally thought it was beautiful and progressive and forward-thinking."
Despite what competitors and Wall Street investors (who drove down stock prices for MGM Mirage immediately after its 2009 fourth-quarter conference call in February) may think now, Baldwin expresses certainty that CityCenter-with all of its ups and downs and lingering issues that still include the star-crossed and unfinished Harmon Hotel-will prove to be a smart decision in the long run. Clearly, he believes that the property lives up to what executives at MGM had hoped for. "Jim Murren wanted high density and he has it," says Baldwin. "CityCenter is designed to be different from everything else. It creates an energy that is different from that of its competitors."
One of the first things you notice upon entering Aria-which serves as the centerpiece of CityCenter-is that it is laid out differently from your typical resort casino.
For starters, the most intriguing restaurants rank among the first things you see after checking in. Bar Masa and the more refined Shaboo (domains of Japanese food god Masa Takayama), Sage (an elevated New American offering from Chicago-based, James Beard Award-winner Shawn McClain) and Julian Serrano (a high-end tapas and paella restaurant from the man behind Bellagio's haut Picasso) come into sight just beyond the front desk. Normally, these prized dining destinations would be strategically tucked away, so that you have to walk past gambling enticements before you get a chance to scan a menu. Murren says that the idea was to defy Vegas logic and situate the restaurants where they will be most convenient for his customers.
Elsewhere are eateries from the usual suspects: Michael Mina's American Fish, a steak emporium courtesy of Jean Georges Vongerichten, Sirio Maccioni's take on classic Italian. But, dining-wise, the greatest surprise is Sage. It's a restaurant that manages to be simultaneously casual in terms of surroundings and ultra high-end where the food is concerned. Foie gras custard brûlée, which is really a soufflé of velvety goose liver, is not to be missed.
Clearly, though, CityCenter's biggest scores are Chef Masa's eateries. Dinner at his top restaurant in Manhattan can easily run $1,000 per couple, after sake and supplements get tacked on. Shaboo is even pricier. As would be expected, his sushi is top grade-it ships in from Japan, making one stop in New York and then next in Vegas-and Shaboo promises to be an omakase experience that you won't want to miss if your bankroll (or, preferably, comp dollars) can withstand the tab.
Not surprisingly, McBeath reports that the cigar-loving Masa was a particularly tough chef to land. "We originally spoke with Nobu [the restaurant chain was deciding whether or not to renew its relationship with the Hard Rock], but when they told us what the Hard Rock does for them economically, we told them that we can't match it," says McBeath. "Then we wondered how it would be to pull in Masa." After a good deal of negotiating and wooing, he came along on the condition that "if we extended his brand, we would be giving up a lot of creative control in the process." On the upside, McBeath knew that his customers would be enjoying Masa's delicacies in precisely the way that Chef Masa wants them to be eaten.
Taking a cue, perhaps, from Steve Wynn's playbook, natural light seeps onto the gambling floor here, which is colored darker and appears more sophisticated than other casinos around town. The poker room has been outfitted with a big-ante enclave that will host high-stakes games when preferred players happen to be in house-though it's not expected to usurp the cachet of the Bellagio's famous Bobby's Room. In fact, Aria has been designed to be unique enough to cannibalize as little business as possible from other MGM Mirage properties. McBeath sites the fact that Bellagio held its own in the face of competition from Steve Wynn's ventures and he says that so far it's doing the same against CityCenter.
So if significant numbers of people are not leaving Bellagio for the new place, where are customers coming from? According to Murren, CityCenter traffic is feeding in from the most desired outlets of all: "More people are coming to Las Vegas. We've had four months of increasing visitation, so one course is incremental visits. We're also taking share from our competitors. Right now Bellagio is up year over year. We think it has benefited from all the excitement surrounding CityCenter."
Fitting with CityCenter's urbane theme, the best suites at Aria are more sophisticated than the classic Las Vegas villas you'll find at Bellagio or The Mansion at MGM Grand. That, too, serves to differentiate it for the coveted whales who may prefer private patios and Jacuzzis over 26-foot-high, floor-to-ceiling windows, sleek furnishings, spiral staircases and a personal en suite elevator if the steps get to be too tiresome.
Designed by Peter Marino-whose residential client list includes the likes of Giorgio Armani, Gianni Agnelli and Ron Perelman-the top-tier units, on floors 57 through 59, come off as hideaways that are fit for billionaires. "We designed our penthouses to be a property within the property," says McBeath who's personally gambled enough with his own money to know what high rollers desire. "You have your own arrival and check-in. Then, when you're ready to play, you come down the hotel elevator, onto the casino level. Baccarat is to your right and Carta Privada [for other high-limit table games] is to your left."
Standard accommodations aren't too shabby either, all masculine with leather detailing and earth-toned color schemes. Sticking with the mandate to be different, the rooms are loaded with enough technology to remind you that Aria is the newest place in town. A bedside control panel allows you to black out the room from under your covers but leave the TV playing, set to shut once you doze off. Come morning, the room can be programmed for a gradual wake-up via a slowly increased incursion of light and sound. The sleek, flat-panel television is outfitted with takeoff information from McCarran International, so you can gauge if your flight is delayed and act accordingly. Get a room with an off-Strip view and you'll be looking west to a mountainous panorama, which makes for a nice respite from all the typical glitz of Las Vegas.
Same with the art that you encounter when strolling around CityCenter. These days, with a museum at Bellagio, real Picassos in the restaurant named for the artist and Venetian's scuttled attempt to bring the Guggenheim to Vegas, nobody is really shocked that hoteliers have the taste and money to get their hands on quality works. That said, CityCenter kicks art accumulation, and the placement of it, up to a new level. There are around 15 pieces, purchased with a budget of $40 million, scattered around the inside and outside of CityCenter.
An enormous Julian Schnabel dominates one wall near the convention center. Maya Lin, who's most famous for the Vietnam Veterans Memorial in Washington, DC, created a spurty looking piece, made from reclaimed silver and designed to match the shape of the Colorado River, that hangs above the front desk of Aria. When a Henry Moore sculpture was put into place outdoors, the 50,000-pound piece proved so heavy that the ground it stands on had to be enforced. My personal favorites are Nancy Rubins's enormous sculpture composed of full-size boats and kayaks near the front door of Vdara and Jenny Holzer's ever-changing text-driven installation that adorns north valet parking. Taking in wall-size "truisms" such as "Sometimes you have a luxury of time before something bad happens" (which adopts special meaning amid the blackjack and craps tables), brings an intellectual and aesthetic experience to the simple act of waiting for your car.
Less likely to be noticed by guests is the green initiative that is integral to the construction and operation of CityCenter. Each building there is LEED gold certified, which means that they meet high levels of sustainability and environmentalism. Overall, the facility uses less water, burns less electricity and cools more efficiently than similar properties do. Showiest of all is CityCenter's armada of limos, which run on compressed natural gas. While Baldwin recounts "the pain" of watching $90,000 stretches being crash-tested (never mind that Baldwin's been known to win and lose that much on a single hole of golf), he also makes it clear that, besides being the right thing to do in the eyes of society, green efforts also pay off economically. "There are companies that won't give you convention business unless you have a sustainability plan," confirms McBeath. "Plus we save a lot of money operationally by cooling air from the ground up [instead of from the ceiling down] and generating some of our own power."
When all is said and done, the fact that CityCenter-complete with its state-of-the-art spa and bumping nightclubs-even made it to the finish line, considering its timing and economic challenges, is something that the folks at MGM Mirage should be proud of. Bobby Baldwin is quick to point out similarly ambitious undertakings- Echelon and Fountainbleu, most glaringly-that didn't come close to completion. They remain stillborn construction sites that serve as grim reminders of how quickly Vegas's economic realities whiplashed over the last few years.
Speaking to me in early March of 2010, Baldwin expresses a belief that by the time you read this, customers will be enjoying the warm weather and experiencing the more metropolitan, stroll-worthy aspects of CityCenter. He envisions people taking in the outdoor art collection, walking from property to property, gambling in Aria, lunching at the Pan-Asian restaurant Silk Road inside Vdara, enjoying afternoon tea on the elegant 23rd floor of Mandarin Oriental and shopping at Crystals. In the best-case scenario, they'll be toting brown, black and robin's egg blue bags from Louis Vuitton, Roberto Cavalli and Tiffany-before settling on a place for dinner, gambling it up in the casino and checking out Aria's Viva ELVIS show or dancing in its nightclub Haze.
That, of course, is the romantic view of success: customers enjoying and spending. Baldwin, McBeath and Murren all know that the more objective metric will be evident on P&L statements and echoed in Wall Street's belief in CityCenter. It's a belief that will ultimately cause MGM Mirage's stock prices to rise or fall. An early vote of confidence came in April 2009, when the cash-strapped company managed to raise $1.2 billion in the equity market. Considering that 2009 stood as a year in which MGM Mirage had operating losses, Murren characterizes those who bought in as having "bet on black." The stock was priced at $7 per share when it was offered and rose to around $11 at the time of this writing.
Murren, considering his past history on Wall Street, knows as well as anyone what it will take for CityCenter to be considered a financial success by the investment community. "It needs to generate incremental profits to MGM Mirage," he says. "It needs to generate operating income, which would be profits after we pay interest on debt." Murren hopes that CityCenter will turn $1.1 billion in condo sales this year, which would represent half the total units. The project currently has $1.8 billion in debt and an additional $6.7 billion invested via the joint venture with Dubai World. To become profitable, Murren explains, "CityCenter will need to generate $700 million. That is not possible now, but I think it will happen somewhere down the line. This year, though, CityCenter will be positive on operating cash flow [before debt considerations are met]."
Within the tighter confines of Las Vegas, where the economy has experienced the kind of high-impact crash that Baldwin had witnessed his $90,000 limos being put through, CityCenter's completion, in and of itself-regardless of when it starts to make money after debt payment-is a vote of confidence and a financial mainline. In a city that may finally be overbuilt, nobody is expecting anything like this to be on the boards for the foreseeable future. Still, though, Vegas has to continue moving forward in order to keep from dying. On that end, the completed CityCenter stands as an example of resiliency and a nod toward the future. "People who live here," says Murren, "view it almost universally as a symbol of hope."
He's banking on visitors taking a less earnest view and simply deeming CityCenter as a new way of doing Vegas.
Michael Kaplan is a Cigar Aficionado contributing editor.
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