Showcase Mall developers join casino building team

David Strow

Thursday, Jan. 4, 2001 | 11:31 a.m.

A group of developers, including those who built the popular Showcase Mall on the Las Vegas Strip, today announced preliminary plans to develop up to three hotel-casinos on 77 acres of land on the south end of the Strip across from Mandalay Bay.

Few details were available at today's announcement, as the developers say they have yet to finalize joint-venture agreements with potential partners.

However, officials with New World LLC said they are in negotiations with several possible partners including Virgin Group Chairman Richard Branson, who wants to promote Las Vegas as a destination for his Virgin Atlantic Airways.

"We could build on our own," said Barry Fieldman, a principal in Makena Development and a partner in New World. "But we have not been in the hotel-casino business. We are looking for partners to go into development with us. We are designing the master-plan."

Fieldman is well known in Las Vegas along with his partner Bob Unger for developing the Showcase Mall next to the MGM Grand. The multi-level mall is marked by a large Coca-Cola bottle and features only non-gaming attractions.

The other partners in New World are real estate executives Howard Bulloch and David Gaffin.

Their master plan would involve three separate megaresorts inter-connected through a central attraction that could include a convention center or a performing arts center.

One investor that has been lined up is Tom Gonzales, founder of the Silicon Valley-based firm Commerce One. However, few details were disclosed this morning on his role in the project.

The New World real estate is not contiguous on the Strip, which is why the development is planned for three separate parcels. The three parcels have a combined total of one-half mile of frontage on and near the east side of the Strip.

Fieldman said all of the land purchases were internally financed and the partnership carries no external debt. "We're not highly leveraged land speculators," Fieldman said.

The partners said this morning they have assembled all of the land they intend to acquire and that no more land purchases are planned. They noted that gas stations sitting directly in front of existing megaresorts don't appear to be hurting business at those resorts, so New World doesn't plan to buy all the land blocking direct access from its property to the Strip.

It's unclear whether the partnership will obtain the necessary financing to complete its ambitious development plans. Hundreds of millions -- if not billions -- of dollars will be needed, and Wall Street currently is nervous about financing Strip projects because of uncertainty about the direction of the local gambling economy.

In addition, the New World partners must either sign up as partners or compete against the world's largest and best-financed gaming companies that operate on the Strip including Mandalay Resort Group, MGM MIRAGE, Park Place Entertainment and Harrah's Entertainment.

But the partners are optimistic.

"This is absolutely one of the most premier locations on the Strip to develop a megaresort," said Unger, who is president of Makena Companies, a real estate development firm with several projects in the Las Vegas Valley. "When completed, this will be a huge asset to the economy and a popular destination for both tourists and locals."

"Millions of tourists visit Las Vegas annually, and this will provide yet another avenue for them to enjoy our wonderful city," said Gaffin.