Jeff Simpson on how the El Cortez is quickly becoming downtown’s feel-good story of the year

Sunday, March 11, 2007 | 7:40 a.m.

Megaresort developments have become the norm on the Strip, and those multibillion-dollar investments have been dwarfed by recent casino industry mergers and acquisitions.

The numbers are dizzying, and I'll confess to having to think twice when I add nine or more zeroes to a number to quantify the scale of investment.

And that's just one reason I feel so good about a much smaller investment at a property I was convinced time had passed by.

I spent a couple of hours at El Cortez last week, and left feeling very upbeat about the impact $18 million or so can have, not just on a classic downtown casino, but also on its 710 workers, its immediate neighborhood and on downtown Las Vegas.

It had been more than a year since I last visited El Cortez, a club once owned by Bugsy Siegel and owned for more than four decades by downtown casino legend Jackie Gaughan.

The casino used to be a little dirty, cluttered with out-of-date slots, grimy carpeting and cheap paneling. The attitude among customers seemed to be: "At least we're not at the Western."

Some El Cortez customers didn't look much different from the panhandlers, tweakers, pimps and hookers that stalked the surrounding blocks. Maybe they looked a little better than the casino's journalist customers.

But as I toured the hotel with General Manager Mike Nolan on Wednesday, I saw a ton of changes, almost all of them positive.

Hotel rooms have been totally redone and are now a strong value. Restaurant offerings are improved, as is the casino decor.

A new porte cochere is being built on the casino's west side, on Sixth Street, and should be finished by the end of May.

In the casino, more than $500,000 has been spent on filtration systems to clean air that used to be among the city's dirtiest. More than half of the slot machines have been removed and many others replaced with new models, with an emphasis on slant-top devices that allow greater visibility.

The table-game pit has been furnished with modern amenities, including LED and plasma signs that are the same as those at the best joints in town. The casino cage has been gutted, with its forbidding holes-in-the-paneled-wall replaced by modern brass-railed windows.

The only downside to the wholesale changes was a matter of personal preference. The casino swapped its old-school gambling chips for new versions, and certainly they are a lot cleaner, without the accumulated crud of the old chips.

But the old El Cortez $25 chips were brown, with yellow and green accents. Almost all other casinos use green chips for the $25 denomination, while brown is saved for $5,000 chips, often called "chocolates" by the big-betting gamblers who play them. Of course, at El Cortez $25 feels like a big bet, even though they now play with more pedestrian green chips.

I was pleased to see Gaughan ("Mr. Jackie," the staff calls him) playing poker. Now in his golden years, the property's majority owner relies on his executive team of minority partners to run El Cortez, including Nolan, longtime Las Vegas casino boss and Chief Executive Kenny Epstein, Director of Gaming Operations Alan Abrams and Chief Financial Officer Joe Woody.

Gaughan's son, Michael , attends directors' meetings in an unofficial capacity, keeping an eye on things for his father.

The casino is already turning a profit, prompting the owners to buy back an option to buy the place that Jackie Gaughan sold a few years ago when he sold his other downtown casinos to Barrick Gaming.

The executive team has done an amazing job with a small amount of capital. It's not the kind of investment that will turn the tide that has seen Strip casinos increase their dominance of the tourist market while locals casinos sucked the life out of downtown's local customer base.

But the investment, coupled with the new entertainment zone that will surround the casino on Fremont Street and the nearby condominium development already under way, should make El Cortez more fun, and more profitable, at least for a while.

I didn't interrupt Jackie Gaughan's poker game to ask him what he thought of the job his executive team had done transforming his hotel, but I didn't need to.

I know he must be happy and proud - proud as "El."