News for the Hospitality Executive
|By Rod Smith, Las Vegas Review-Journal
Knight Ridder/Tribune Business News
Nov. 27, 2003 - The two newest developments planned on the Strip -- Wynn Las Vegas and The Venetian II -- are shaping up as a pair of titans challenging the rest of the industry for uppercrust convention business.
Gaming industry insiders agree convention business is now driving the Strip economy, not the gambling for which it is both famous and notorious.
Longtime developer Steve Wynn said in a recent interview that the $2 billion Wynn Las Vegas he is building at Las Vegas Boulevard South and Twain Avenue will lead a charge to capture many of the top-tier convention attendees as room guests at his property when it opens in 2005.
Wynn said he was hooked on buying and redeveloping the old Desert Inn property by plans to expand the Las Vegas Convention Center and the Sands Expo and Convention Center, both of which are near his new site.
Wynn's plan is to capture many of the top executives from the country's biggest and richest corporations who plan their annual board dinners and presentations to major investors and customers during conventions at the two major Las Vegas convention centers.
To attract uppercrust attendees as guests at his new 2,800-room property on the Desert Inn site, Wynn said he is building a complex that will include a 50,000-square-foot ballroom and a 25,000-square foot ballroom.
"I'm building 220,000 feet of space so everyone can have their banquets and dinners here," he said. "This piece of the property was strategic. You didn't have to build the convention space. It was already here. Our hotel is the natural alternative.
"That's one of the reasons I have the site. It has a guaranteed, built-in midweek demand."
Wynn Resorts has been presenting promotional material to meeting planners pumping the design, the technologies available and the staff assembled to customize on-site meetings.
Wynn's apparent competition in all this will be the existing Venetian and the new Venetian II resort, planned for the corner of Las Vegas Boulevard South across Twain Avenue from Wynn Las Vegas.
Deutsche Bank analyst Andrew Zarnett said the link between Wynn Las Vegas and the Las Vegas Convention Center is "very easy to get because there are no quality rooms there -- the closest link with property transit will be Wynn Las Vegas and the conventions will drive its midweek occupancy."
However, Sands Expo and Convention Center President Richard Heller said Wynn Las Vegas will be at a disadvantage to the two Venetian resorts, which are adjacent to the 1.2 million-square-foot Sands Expo and Convention Center because, "after all, it'll still be across the street."
However, even The Venetian with 4,000 rooms, Venetian II with an expected 3,000 rooms, and Wynn Las Vegas with 2,800 rooms won't be able to put up all the attendees for a convention drawing 30,000 to 100,000 people.
"From the Sands Expo perspective, obviously The Venetian is attached and it's a first-class destination for guests and the first place a customer is going to want to stay. They won't want to stay where they have to run across the street," Heller said.
Zarnett agreed that the link with The Venetian is less direct, but "if you're looking for the most luxurious destination, you'll choose (Wynn Las Vegas) for that plus the convention (location)."
Heller said most of the business Wynn Las Vegas will attract will come from other Strip hotel-casinos.
"In the past, when The Venetian was full, guests went to other hotels. That's where (Wynn) will get his business," he said. "There's absolutely room for (Wynn Las Vegas). It won't hurt The Venetian's business, but he'll take business from other hotels. If we have guests now staying at Bellagio, they're going to want to stay at Wynn Las Vegas."
The Venetian management also found that its original 3,000-room tower was too small to support the business warranted by a full-scale Strip casino, and Wynn could face similar problems.
"(But) the big problem Steve (Wynn) is going to find is that he's only building a 2,800-room hotel and demand will lead him to an expansion sooner rather than later," Zarnett said.
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(c) 2003, Las Vegas Review-Journal. Distributed by Knight Ridder/Tribune Business News. WYNN,