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Bill McBeath, president and chief operating officer of Aria, trusts that CityCenter will not cannibalize other Strip properties.
Monday, Dec. 14, 2009 | 2 a.m.
Will They Come?
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Sun Coverage
The doors open Wednesday at Aria, the centerpiece of MGM Mirage’s new CityCenter development. The company turned the keys over to Bill McBeath, a UNLV Alumnus of the Year who joined the company in 1987.
McBeath held management positions at the Mirage, Treasure Island and Bellagio and took a leap of faith to leave Bellagio to take over as chief operating officer of Aria and Vdara, the nongaming condo-hotel that began the phased opening of the $8.5 billion Strip property on Dec. 1.
What keeps you up at night when you think about Wednesday’s opening?
Everything. There are 91 separate IT applications and a lot of them are first-generation. Innovation was a key development principle for us and we felt innovation had to do one of two things: increase operating efficiencies or enhance the guest experience.
What went through your mind when you first learned that your joint-venture partner, Dubai World, had sued MGM Mirage last spring?
It was a defining moment in my life but I was most worried about the people who trusted me. They left jobs to be on the team. I had the belief that CEO Jim Murren and our board of directors would see this through. I kept thinking, “Man, we’re so close … and the world is never going to see what we did.”
People say, “Just give me a great casino!” Is it enough to do just that?
We have a casino. It’s the anchor tenant and, I believe, the most spectacular casino ever built. Time will tell. We went through something similar at the Mirage. When it was built, people wondered whether we would make enough to pay for it. Mirage made money in retail, food and beverage, and entertainment. We made a million dollars a day in the casino on top of the other revenue.
Lots of people are expecting CityCenter to be a traffic nightmare. Why won’t it be?
Every single trash stop, warehouse and loading dock is below grade. We tried to replicate Fifth Avenue in New York and we did it without the cabs and delivery trucks. But people said, “Just wait until you get all your employees in there.” They forget that we had 10,000 construction workers and only two lanes on Frank Sinatra Boulevard for five years. Traffic is good, congestion is bad. I expect lots of traffic.
Isn’t the LEED Gold certification a somewhat hollow honor since you allow smoking on the property?
If you ban smoking, you eliminate 30 percent of the customer base. What the critics don’t know about is how efficient the casino air-displacement system in Aria is. In most casinos, you mix pollutants with the circulation system. With displacement, warm air rises and takes all the pollutants with it. In a test, we had everybody in a room smoking and just watched the plumes of smoke go straight up in the air.
Why are you confident that CityCenter won’t cannibalize other Strip properties?
Loyal customers at Bellagio will want to see Aria, but it won’t be for all of them, the same way that the Venetian, the Wynn and Encore have opened up but didn’t strip the Bellagio of customers. Any time we’ve added truly innovative properties to the Strip, visitation and gaming revenue on a percentage basis has exceeded the additional capacity. The rising tide lifts all boats.
A version of this story appears in this week’s In Business Las Vegas, a sister publication of the Las Vegas Sun.
MGM Mirage will do exactly what they did when they acquired Bellagio, back when Mirage Resorts stock was hovering at 10, which by coindidence, is where MGM Mirage stock is now. Newly created MGMM shifted better customers (exclusive of Mansion guests) from MGM Grand to Bellagio, except many kept coming back to MGM Grand for the friendly openness and familiarity. So, they simply cut staff and services through attrition at MGM Grand for cost synergies to justify the acquisition, which also helped to get better customers to Bellagio for higher F and B revenues.
MGMM will market-shift Bellagio's best customers to City Center, and try real hard to fill Bellagio and their mass of mid level rooms with new customers, good luck there in this economy.
Inevitably, they will approach Wynn Resorts about a sale for Bellagio, because not only is the company competing against itself too much already, with Bellagio it is competing right next door with City Center, side by side.
Bundling was bad for the customer experience and bad for labor, but it did provide opportunities for people to learn about new behaviors in the Strip Corridor industry.
More hot air and spin from MGM management. If they think for one second that this place is gonna take off, they are living in a dream world. This is the biggest pipe dream I've ever seen!
I can't believe what I just read. MGM Mirage believes that City Center won't cannibalize the rest of the city? Seriously?
That would imply that there was pent up demand for high end product that wasn't being satisfied by Wynn, Venetian, Bellagio, and the Four Seasons....enough to fill 8,500 rooms. What are they smoking over there?
However, for our local economy's sake, I hope they are right.
S711
Maybe before when Las Vegas gaming was a monopoly.
Abolish income tax for a year. Maybe that will work.
Good luck, did you hear about the water? Don't drink it. the timing could be better. I really wish you a happy bottom line, however I won't bet the farm, or in my case, my bus pass on it. The comment "rising tide lifts all boats" reminds me of some other sayings, none too positive...When the tide goes out, the flotsom and jetsom of the economy will be more evident.
Who cares!These so called masters of the strip killed off the golden goose years ago,and word of mouth continues its down fall!With 1 good comment about a so called good vegas trip,i hear thousands of bad ones,and that the people have no desire to return!As for the people who had this "city cemetery" in mind have to be looking back and saying to them selves,"what did i just build"?Would have been better had they topped the biggest tower with "BUGSY'S"
They can have Jesus Christ on exhibit in these airplane hangers. It wont do much good in this economy.
Best of luck MGMM. May you have a spooth opening and lots of success.
Just don't neglect your other properties for one property. Right now Luxor looks shabby, Excalibur is filthy, NY NY is a mess with no flow inside the casino, Circus Circus needs a face lift, Mirage has no class anymore with the weed wacking of the theme and rain forest, and your employees moral is in the toilet.
You need new top management at these other properties to really turn this company around.
If Bobby Baldwin made a sudden turn to the left or right, McBeath would have a broken brown nose.
Rising tide raises all boats? Hmmm - it seems to me a rising tide would mean that the Titantic is even deeper under water. I say there will be 10,000 fewer jobs in places like Sahara, Harrah's, Paris, etc as well as making it tougher for some of the non-strip properties. Ok, good luck with that!
So this 'green' project
allows smoking in the
Aria casino :(