Resort tries bolstering its tourist base

David Strow

Wednesday, June 14, 2000 | 10:39 a.m.

After months of campaigning to draw locals, executives at the Regent Las Vegas are launching a new campaign designed to shore up out-of-town traffic at the upscale Summerlin resort.

Darrell Luery, president and chief executive of the Regent, said Monday that the resort will soon open a marketing office in Southern California. The office will head a marketing campaign aimed at Southern Californians -- the resort will soon launch an advertising campaign consisting of television ads, direct mail and dealings with commission-based independent representatives.

"We had to make the locals feel comfortable first," Luery said. "But that's not what (the Regent) was built for. We are not strictly a locals casino. We have 5-diamond quality rooms and all that goes with it.

"We are looking for that (out-of-town) visitor that wants the 5-diamond (resort) experience along with the gambling."

Luery said the 541-room resort is averaging occupancy percentages in the "mid-80s," nearing or meeting full capacity on the weekends.

Luery delivered the keynote address at Casino Ops 2000, a gaming industry conference hosted by UNLV and Casino Journal Publishing Group.

Attracting locals to the year-old property has been the focus of the Regent's advertising since the beginning of the year, in a campaign that included billboards, print ads, direct mail, television and radio. The resort has scheduled locals-specific events, such as concerts and boxing matches. In an effort to increase local slot play, the resort also changed its machine mix to include a heavier proportion of video poker machines.

"We are trying to position ourselves as the social center of Summerlin," Luery said.

Other plans designed to make players feel more comfortable include a possible reworking of the casino floor. Luery said casino players, particularly local ones, may not be comfortable with the sunken table game area, which makes players easily visible from much of the casino.

"What we're finding is people don't like to be seen that easily on the casino floor," Luery said. "We are now making plans to possibly raise the floor of the area where the table games are."

"It's something we'd like to do, provided we can do it efficiently, economically, and in balance with rest of our plans."

Since initiating its locals oriented ad campaign, Luery said the resort's slot volume is "significantly up," and the resort has built a large base of regular local players.

The results have pleased Swiss Casinos of America, majority owner of the Regent.

"I think we feel good about the overall direction of things," said John Tipton, president of Swiss Casinos of America. "We've been happy with the product we now have and the response to it."

But it isn't clear exactly how the resort is now performing after the struggles following its July 1999 opening. The company has yet to file its 1999 annual report or its report for the quarter ending March 30, though Luery said a quarterly report should be filed within a week. Luery said he couldn't comment on whether the resort would achieve profitability during the quarter.

In the quarter ending September 30, 1999 -- the last quarter for which financial results are available -- the Regent lost $21.9 million on revenues of $18.9 million. Nearly $7 million of the loss was caused by preopening costs.

Andrew Zarnett, gaming analyst with Deutsche Bank Alex. Brown, said the ultimate success of the Regent will depend on how successful the property is in attracting gaming customers to its hotel rooms.

"The question is, with some reconfiguration, a more focused strategy on going after casino customers, and better cost controls, can they generate a decent return?" Zarnett said. "That is the big question. The answer's probably yes, because they have a great physical plant to work with.

"(Luery) has a lot of experience in the business, and he's been good at turning around properties in the past."

He added, however, that a complete turnaround shouldn't be expected overnight.

"You should look over the next 18 months, not the next month or two," Zarnett said.

A new challenge for the resort could emerge in September, when Coast Resorts opens Suncoast, a $175 million, 216-room resort catering almost exclusively to Summerlin-area customers. Suncoast is located about a quarter mile south of the Regent on Rampart Boulevard.

But Luery doesn't believe that has to be a bad thing for the Regent. He cited the synergistic benefits seen by Texas Station and the Fiesta, both located at the intersection of Rancho and Lake Mead in North Las Vegas.

"I think we have an opportunity to enhance each other, rather than trying to compete with each other," Luery said. "Coast is a very good operator. We should both recognize there is an opportunity by having two properties in the same general geographic area, rather than one."

Zarnett agreed that Suncoast shouldn't be viewed as bad news for the Regent, particularly because the two properties will offer distinctly different products.

"As Suncoast begins to develop their business, customers will start to say, 'We can go over to that area, because we have two choices,"' Zarnett said. "You could go watch a movie at Suncoast, and have dinner at the Regent.

"Because they cater to different customers, there could be some crossover opportunities."