Gaming:

Low cost is Eastside Cannery’s major innovation

Steve Marcus

The Eastside Cannery, built as a slightly higher-end property than its sister casino in North Las Vegas, occupies a part of the suburban valley that is already home to a host of casinos. It’s within three miles of Boulder Station, Arizona Charlie’s and Sam’s Town, but it’s expected to benefit from being the new kid on the Boulder Strip.

By Liz Benston (contact)

Thursday, Aug. 28, 2008 | 2 a.m.

When the Eastside Cannery opens for business this evening, customers may notice a few vintage touches — beaded curtains, geometric tile accents, murals of women in beehive hairdos and photos of cars with tail fins.

Steve Marcus

Roulette dealer John Furry, left, practices Tuesday at the Eastside Cannery for the $250 million, 307-room casino's opening tonight on Boulder Highway.

Chris Morris

Casino opening

The Eastside Cannery will open its doors at 8 p.m. Thursday.

Reader poll

Eastside Cannery

They may also notice the latest casino to open in Las Vegas has a buffet with tableside service (an all-you-can-eat restaurant that lures passers-by with a 20-foot dessert bar, diner-style, out front), a retro entertainment lounge with high-backed sofa chairs, and cocktail servers in snug outfits resembling those once worn by carhops at drive-ins.

The industry elite, however, will be focusing on another achievement: the property’s $250 million price tag.

Keeping the cost of the 307-room property at Harmon Avenue and Boulder Highway low is a feat that isn’t going unnoticed in an industry in which a simple hotel or casino expansion can cost hundreds of millions of dollars.

Until today’s opening, the most recent casino debut in Las Vegas, the nearly $1 billion, 400-room Red Rock Resort in 2006, broke a money record for suburban casinos. The $700 million M Resort will open in March with 400 rooms.

Cost is more than a factor of size.

At Red Rock, Station Casinos splurged on marble floors, bartops of solid onyx and custom-built chandeliers, among other things. Some observers, noting the extra cost, said locals wouldn’t care that walls were lined with exotic wood and stone instead of wallpaper. But Station executives say their iconic resort was built to withstand competition for decades to come.

The Eastside Cannery is a study in doing a lot with a lot less.

Bold, colorful accent pieces in purple, orange and yellow make the property look upscale without more expensive materials, general manager Sal Semola said. The understated 1960s theme is aimed at all ages, from the older crowd that will recognize some of the designs to a young audience attuned to a modernized vintage look, he said.

The property’s hotel tower is “modern industrial,” with pitched sections of roof in corrugated metal and girders lined with LED tubes that will change color at night.

“We wanted a look that was timeless, that wasn’t going to look stale years from now,” Semola said.

The floor is patterned carpet that’s just midcentury enough in appearance to look hip — with nary a marble slab in sight.

But customers aren’t likely to notice the ways in which the property’s co-owners, Cannery Casino Resorts executives Bill Paulos and Bill Wortman, kept costs under control. The lower price tag will increase the odds that the property will turn a profit more quickly.

Keeping the decor in check is only part of the equation.

Paulos and Wortman have opened more than a dozen casinos on the Strip and beyond. They have learned the more specific their project plans are from the outset, the easier it is to keep costs down during construction.

Some changes to a property’s initial plans are inevitable. Yet costs can spiral upward with each change and add-on, Semola said.

“You have to understand what you’re doing on the front end or that’s going to drive up your costs,” he said. “These guys are good at keeping things under control. And they’ve done this so many times that they know what to expect.”

The bosses have bullish expectations for the property, in spite of its conservative price tag.

Paulos and Wortman opened the Cannery in North Las Vegas in 2003 — a property that benefited from its relative isolation on the northeast side of town.

The Eastside Cannery has about 50 percent more rooms and slightly more slot machines than the Cannery despite being within striking distance of three big casinos and several small ones along Boulder Highway. The property also has two features that are lacking at its sister casino in North Las Vegas: 20,000 square feet of meeting space and a top-floor entertainment venue unique to Boulder Highway, called One Six, with panoramic Strip views.

The Eastside Cannery, Semola said, was built as a slightly higher-end property than the Cannery. The company’s third local casino, the Rampart at the J.W. Marriott in Summerlin, is small but caters to a wealthier crowd, reflected in its higher-end Waverly’s Steakhouse. The Eastside Cannery’s steakhouse, Carve, has hardwood floors and a prominent meat carving station but will have a more casual atmosphere and clientele, Semola said.

Unlike other valley suburban areas, where casinos are miles apart, Boulder Highway, with some of the highest slot machine payback percentages in the area, is a competitive slugfest.

The Eastside Cannery is less than a mile down Boulder Highway from Boyd Gaming Corp.’s Sam’s Town casino, less than two miles from the Arizona Charlie’s Boulder casino and less than three miles from Station Casinos’ Boulder Station. Many other, smaller casinos dot the “Boulder Strip,” where casinos generated $903 million in gambling revenue over the 12 months that ended June 30, versus the Strip’s $6.7 billion. By comparison, downtown casinos reported $622 million in revenue and North Las Vegas casinos reported $295 million in revenue, according to the Gaming Control Board.

The casino is in an older area known for its trailer parks and rent-by-the-week motels that developers have avoided in favor of the faster-growing western part of the valley.

The Eastside Cannery, the first new casino on Boulder Highway since Boulder Station opened in 1994, will benefit by being the new kid on the block, Semola said. It’s expected to attract customers from the former Nevada Palace, patrons from nearby properties and people who are new to the area, he said. It also will benefit from new housing developments that have sprouted up on both sides of the highway in recent years, he added.

Proximity to the competition will work to the casino’s benefit, Semola said.

“There’s critical mass here,” he said. “There’s clearly demand for this product from locals but also regionally” from California and Arizona visitors.

The economic downturn began after the property was under construction and its depth was largely unforeseen by gaming executives. But the downturn probably wouldn’t have changed the timing, plans or price tag for the casino, Semola said.

“You’re not going to have a trendline that’s constantly going up. You’re going to have those downturns, and the town is going through a period of overbuilding right now. But we’ll get through this,” he said.

“This investment makes sense for this market right now. We can always expand in the future.”

Discussion: 12 comments so far…

By jenna

8/28/08 at 2:20 a.m.

Suggest removal

None of the casinos the writer mentions are the biggest money makers in the official Boulder Strip market used for the stats in the story. The top two are Green Valley Ranch and Sunset Station. The Eastside Cannery was built cheaply but it is no sure thing that it will return much on the investment in the downscale section of town it has to compete in.
By PatriciaLV

8/28/08 at 3:37 a.m.

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Neither GVR nor Sunset Station are on Boulder Highway. Perhaps that's why they aren't noted in the story; they aren't direct competition.

I also disagree with your last sentence; that "downscale section of town" you summarily dismiss as so much rabble (or at least that's how it appears) generated about the same amount of revenue as Downtown AND NLV combined. Another "name" casino can only add to that total.

Face it; locals don't care about places like Red Rock or GVR and their lustrous decor and their even more lustrous guest list. They don't care where Diddy stays or that the "hip crowd" hangs at the Palms.

And Station Casinos is rapidly approaching pricing themselves out of the locals' market, despite touting themselves as "the locals' casinos". Their events are just slightly less costly than many Strip events. Their payouts are about what the Strip payouts are - low & slow.

Locals want a good value and at least a respectable return on their money. They get it on the Boulder Strip. And that's where they'll continue to spend their money.
By 777irish

8/28/08 at 4:22 a.m.

Suggest removal

After living right behind, Sams Town, Charlies etc. we saw, and enjoyed ALL the LOCAL casinos in and around Boulder Hgw. It was Great!!! However, once casinos took away that "LOCAL Feeling" and took away all the magic and old time respect for the locals..thats when they lost!! Yes, the economy is bad, yes the money is tight..and yes you have to cut here and there..but..look at the strip, its now just geered into the upper end..the elite, the strip has taken away all the wonderful, Vegas atmosphere..for the high end visitors. Well, hopefully the Boulder Strip will keep that Good Ol feeling we used to get. Good Luck Cannery!!! Locals don't need all the "Fluff" what we want is "OUR VEGAS BACK"!!!
By azsk8fan

8/28/08 at 6 a.m.

Suggest removal

Jenna - GVR is not on or near Boulder Highway. Sunset Station, while closer to Boulder than GVR would not, at least I don't think it would, be considered a Boulder Hwy entity. I'm glad to see Eastside Cannery finally completed - BH could use a newer, cleaner look so maybe this is just the beginning of a whole new renovation period for that area. I can remember before the 215, driving into Vegas from Phx. and getting all excited as I drove Boulder to Trop or Boulder to Flamingo........
By azsk8fan

8/28/08 at 7:21 a.m.

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And I agree with Patricia re; GVR, Redrock - I really don't view those as 'locals' casino's at all. While they may have a mixture of tourist and locals the atmosphere does not lend itself to the 'downhome' feeling that the true locals casino's give out. Heck, I feel more comfortable (as a local) at the Orleans than I do at either GVR or Redrock........they are trying to keep for Strip visitors, that is obvious - just look at the price of their rooms -even with their so-called 'reduced room rates' they are now touting.....nope - I'll stay on Boulder Hwy., Orleans and even the Sahara!
By mikeg

8/28/08 at 8:22 a.m.

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I agree with Patricia as well. I think the Eastside Cannery will do very well because it is clean and new and has a fresh, appealing theme - which is more than you can say about even the newest Strip giants - all the Palazzo has for a theme is "luxury", and it mostly just looks like a fancy airport.

The Eastside Cannery will provide East Vegas residents with a fresh alternative, is not too big to be uninviting, and its signature 16 story tower is visible from all parts of the 93 south freeway and will draw people out of curiosity, and keep them coming when they see how well planned it is.
By CactusJack

8/28/08 at 8:30 a.m.

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FWIW, Eastside Cannery has a new poker room with a $3 rake, which hopefully will bring in a lot of players.

I live equidistant from Sunset and Cannery, so either one will win my play. Does that mean they are competitors? For me, I guess so. I also play more at GVR than anywhere else, but that's only because they spread a game I want to play which the rooms on this side don't--$4/$8 limit with $2/$4 blinds.

Honestly, there isn't a big difference between Sunset and GVR, imho. Sure, a little better decor at GVR, but it's not the reason people would go there specifically. As for Red Rock, when I lived on that side of town...OVERKILL.

I understand Red Rock is losing a million dollars a month. Not surprised. When you invest megabucks in a locals joint, even in an upscale part of town where gas prices are five to ten cents a gallon higher for no other reason than location, you might not get that investment back. I can see RR struggling for years and years, where the Cannery may do quite well.

Nice reporting, Liz, as always.

CJ
By homer

8/28/08 at 9:32 a.m.

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Make no mistake about it this East Side Cannery may disguise itself as a local's casino but in the end their patrons will see the casino will hold as much as the strip and pay the bare minimum as required by law. Just because of the location and the 'hype' management put's into it's press releases one may want to think before they act.
As a patron of the Rampart Casino since it's opening I have witnessed first hand how these
snake charmer's to the local's operate. They will play lose and fast for a while but then you could not win if you had all of the money in world. Caveat emptor! There are many other options for the east siders.
By LVBear

8/28/08 at 2:28 p.m.

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I agree with homer. The North Las Vegas Cannery is a low-roller grind joint. The games are poor to mediocre, and the money is sweated profusely. The sportsbook is afraid of any action above chump change. The Rampart is slightly less bad. I am sorry to say that I don't expect much from the Eastside Cannery. The fact that it rehired much of the deadwood from the filthy, decrepit Nevada Palace tells me all I need to know.
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By catch

8/28/08 at 3:41 p.m.

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BS....The Cannery in NLV is clean and it not a grind joint. I've seen private games, $100 and $50 min bet BJ there all the time.

The dealers are having fun there and never have I seen any sweating over losing.

Pit bosses in casual attire, not the three-piece suit "COP" you see at other casinos and you'll always get a warm welcome. I play there often enough to know.

The staff in other departments are friendliest in town.

The restaurants are fabulous, particularly Waverly's and comps for players flow EASY. This place gives players the best comp value!

I think the Eastside will do real well. Whenever you have a management team that treats their staff above and beyond you'll see a place thats fun to visit.

You'll see great value there.....watch
By kenodave

8/29/08 at 2:51 p.m.

Suggest removal

The bottom line is competition only helps the players. If one casino doesn't take care of its customers, there are several other venues from which to choose. My distaste for Station Casinos has been, they buy out the competition and then cut back on 'locals' ammenities. Watch out Boulder Strip, the heat is on. Where else in Las Vegas is there such stiff competition for the locals dollar?
By localgeezer

8/31/08 at 4:46 p.m.

Suggest removal

I agree with Patricialv and 777Irish.

Many of us locals are retired and simply desire a casino that is clean and offers a fair play for our money. None of us expect to win on every visit. I have played countless hours on BH at all the major properties.

The only positive I see is they all offer more full play machines as compared to the strip. The negative is, all the games (including FP) are just as tight as anywhere on the strip IMHO.

I play very long sessions of video poker and I'm disgusted with the infrequent payoffs. What good is a full play machine if it only spits out a decent hand after spending your entire bankroll for the night.

I'm looking foward to my first visit to the East Cannery next week. I'm having good vibes and I'm hoping they come through as the best locals casino on BH.