Entertainment highlighted on Mirage’s 10th anniversary

Gary Thompson

Tuesday, Nov. 23, 1999 | 10:39 a.m.

It isn't the biggest change at the Mirage in the past 10 years, but it's probably the most visible and certainly the most symbolic.

The 160-foot tall sign on the Strip in front of the Mirage is being enlarged, says Steve Wynn, to advertise the resort's expanding entertainment offerings.

The sign's expansion symbolizes a hotel-casino whose emphasis on entertainment helped transform Las Vegas from a pure gambling town into a full-service resort destination that can make legitimate claim to the title "Entertainment Capital of the World."

That emphasis was no accident. Ten years ago, Wynn took a huge gamble when he spent $620 million to unveil the Strip's first new resort since 1973. With the hotel-casino needing to bring in $1 million a day just to break even, skeptics were convinced it would be a colossal flop.

But Wynn and his aides at the then-Golden Nugget Corp. had a pair of aces up their sleeves -- the illusionists Siegfried & Roy. Before they'd settled on the final design of the new property, the Wynn team agreed the centerpiece of the hotel-casino would be a long-running show featuring the duo performing in a state-of-the-art entertainment facility.

The philosophy was simple: Offer entertainment that will draw in customers not only from the company's own 3,000-room hotel -- then the world's largest -- but from other resorts up and down the Strip, as well.

The execution was perfect: The Siegfried & Roy show has grossed more money than any other production show in history, and the magicians still have two years left on their current contract.

The numbers were compelling: The annual theatrical gross of Mirage's three Strip properties totals $160 million, and will grow even higher with the addition of new entertainment venues at those hotel-casinos.

And the lesson was learned: Since then, says Wynn, entertainment has been the starting point in the planning of all new resorts for the company, which has since been renamed Mirage Resorts Inc.

"The first thing we do is set up the shows," he says. "When we were planning Treasure Island, I made arrangements with Cirque Du Soleil for 'Mystere."' And that other-worldly presentation has become the second-biggest grossing production show history.

Bellagio, the company's newest Strip resort, features another Cirque Du Soleil spectacular called "O," and its Beau Rivage in Mississippi has yet another production by the Canadian-based entertainment company.

"Entertainment has been the driving energy force of all our hotels," Wynn says. And it's constantly being upgraded.

"Since Mirage opened, we've invested more than $200 million in expansions and are currently spending another $100 million on construction right now," says the Mirage Resorts chairman. "We're building two new theaters there, one for Danny Gans and the other for 'Miss Spectacular."'

Gans, now performing at the Harrah's Entertainment Inc.'s Rio hotel-casino, is one of the hottest draws on the Strip, commanding $100-a-head ticket prices and consistently selling out that resort's showroom. He's signed a long-term contract to perform at the Mirage starting next year.

"Miss Spectacular" is the new musical penned for Mirage Resorts by Broadway producer Jerry Herman, who's won Tony awards for many of his past productions.

"Mirage is a much more complex and bigger place than it was before," says Wynn. "In many ways the staff is more sophisticated, which enables us to provide a better quality of service.

"And it's still one of the three dominant properties in Las Vegas, generating more cash flow than newer properties such as Mandalay Bay, the Venetian and Paris. It will make $150 million to $160 million of cash flow this year, proving cannibalization is a pipe dream."

That "pipe dream" is what worried securities analysts who feared Bellagio, the $1.6 billion Mirage Resorts property that opened 13 months ago, would draw customers away from the company's Mirage and Treasure Island properties on the Strip, lessening the return on investment of the older properties.

Some frequent Mirage customers have switched to Bellagio, but Wynn says the boom in Las Vegas visitor volume is more than offsetting any cannibalization that might have occurred.

"The novelty period is over," he says of the wave of new resort openings that have changed the Las Vegas skyline over the past year. "Mirage and Treasure Island are stretching their lead, and are now making more money than MGM Grand, which is the same size as those two hotels combined, but cost a lot more money to build."

Wynn's upbeat outlook for Mirage Resorts isn't shared by some gaming analysts who've criticized the company and its chairman. Mirage stock also hasn't joined in the general upsurge in casino stocks over the past year, though Wynn says that will change over time.

"In the end, this will sort itself out," he says. "The big institutional holders that buy stock for the long term are still with us."

Wynn believes Las Vegas won't see another wave of new resort openings equal to the past year's in a long, long time.

"We've gone from 60,000 to 120,000 rooms in 10 years," he says. "The number of new properties that will be built here over the next 10 years won't amount to spit. What will happen is that those hotels that have opened will concentrate on bringing in more visitors with better entertainment.

"What better example can I give than Mike Ensign, Bill Richardson and Glenn Schaeffer at Mandalay Resort Group? This is a company that never took entertainment seriously in the past. But when we went into the Monte Carlo joint venture with them, the one thing I insisted on was a showroom. They brought in Lance Burton, and look what that's done for them.

"Now look at Mandalay Bay and the tremendous things they're doing there with entertainment. Look at the MGM Grand, which has three showrooms and great entertainers."

Park Place Entertainment Inc., one of Mirage Resorts' biggest rivals, has paid less attention to entertainment than MGM Grand and Mandalay Resort Group, partly because company executives are concentrating on the "overwhelming chore" of assimilating Caesars World into the company, Wynn says.

Park Place hopes to close the $3 billion acquisition in January, the same month the hit European show "Notre Dame de Paris" debuts at Paris Las Vegas, the company's newest resort.

"When that show opens at Paris, it will help pick up their swing-shift body count," Wynn says.

Wynn said Park Place Chairman "Arthur Goldberg and his colleagues will come to the obvious conclusion" -- that entertainment draws people.

"It's a whole new level of activity," Wynn says. "And that's what drives Las Vegas, what makes it irresistible for people to come here. The more shows, the more attractions, the better it will be for Las Vegas."

Wynn often likens entertainment to a gravitational force. "Twenty percent of our audience at Bellagio, Mirage and Treasure Island comes from our rooms and the rest come from other hotels," he says. "We're net receivers of bodies because of our entertainment."

Entertainment will also be a focal point for the next resort Mirage builds on the Strip, he says. Mirage owns a big parcel of land between Bellagio and Monte Carlo and plans to build an entertainment-themed, mid-range hotel-casino there.

Wynn won't say what the theme will be, but promises it will incorporate one of the most enduring and widely recognized entertainment brand names in history.

Recent run-ins with the press and some gaming analysts haven't damped Wynn's enthusiasm for his job nor his confidence in the outlook over the next 10 years for both Las Vegas and Mirage Resorts.

"This is my station," he says. "I don't want to run for president. I want to contribute money to Trump's campaign to get him out of the industry."

Wynn pauses, reconsidering his tongue-in-cheek offer to back rival casino operator Donald Trump's long-shot campaign for president.

"Actually, Trump's soft as butter as a competitor, so I'd like to see him stay right where he is. Trump went into the casino business in 1984, and not once in 16 years has he made any money. Last year he lost only $60 million.

"Nobody goes broke with three hotels in Atlantic City," Wynn says, warming up to the task of speaking about Trump. "But he's the only guy there with three insolvencies. He's the biggest loser in the history of gambling, bar none.

"Politics would be so boring this year if it weren't for Trump, Jesse 'The Body' Ventura and Pat Buchanan. But Donald Trump's ability to be president is directly proportional to his ability to generate profits in the casino industry."

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