NDA now has prime spot to recruit companies to move to Southern Nevada

By Richard N. Velotta

Friday, June 18, 2010 | 3 a.m.

Matthew Schissler used to ponder moving his company to Las Vegas during his long drives from Southern California to the Las Vegas Convention Center, where he frequently attended trade shows.

The chairman and CEO of Cord Blood America Inc. was at the Convention Center again last week. But this time, he was Exhibit A for the Nevada Development Authority’s and Las Vegas Convention and Visitor Authority’s joint announcement of the development authority manning a booth to recruit visiting conventioneers to set up shop in the state.

Development authority President and CEO Somer Hollingsworth’s unbridled cheerleading for Southern Nevada and convention authority President and CEO Rossi Ralenkotter’s constant reminder that “Las Vegas means business” might come across as being a little over the top. Put them next to Las Vegas Mayor Oscar Goodman and his showgirls with hundreds of conventioneers at the Convention Center and it’s easy to dismiss the whole thing as a big publicity stunt.

But get someone such as Schissler to say a few words to explain how and why he moved one of the largest umbilical cord blood stem cell preservation companies from Santa Monica, Calif., to Las Vegas and the cynicism melts away.

Had Schissler seen a booth such as the one the development authority has at the Convention Center, he may have made his decision to move here a long time ago. He started having ideas about it a couple of years ago on one of those I-15 forays. Today, he has a 17,000-square-foot cryogenics laboratory, a stem cell lab and a vision to develop a biotechnology incubator program to attract similar companies to the state.

“It made a lot of sense for me to be here because I was coming here at least once a month to meet with some of these companies at trade shows,” he said. “For us, it was great because we have easy access to the airport and the transportation in and out of here (for shipping materials) is so easy.”

The new booth at the Convention Center is a 16-by-8-foot space with three video monitors playing fast-paced loops of scenes of Southern Nevadans at work and at play. In the center of the booth is a sign that boasts that Las Vegas has the “best business climate in the U.S.”

Schissler also praised the development authority for steering him to the state incentives that enabled Cord Blood to get tax abatements and deferrals for moving to Nevada. A representative of the Nevada Economic Development Commission, which operates the incentive program, also was present at last week’s booth rollout.

The new booth made its debut during the three-day International Communications Association’s Infocomm 2010 trade show that expected attendance of about 32,000 people. Randal Lemke, executive director of Infocomm, said his organization was honored to be the first show the booth was a part of.

The development authority expects to put up to four of its workers at the booth and they can man the booth whenever they want. Hollingsworth said the current plan is to staff it as much as it can.

The beauty of having a booth is that if a company has an interest in the area, the development authority can drive executives out to see whatever they need to look at if it helps them make a decision.

So why didn’t the development authority and the convention authority collaborate on such a thing a long time ago?

The answer lies in today’s tougher economic times. Glenn Christenson, who heads the development authority’s board, said when times were good there wasn’t as much urgency to recruit companies to move to Southern Nevada. Hard times have proved that the area has to diversify its economy with businesses that have nothing to do with gaming or tourism to protect it from downturns.

Christenson said in today’s environment, every new company helps. The same attitude prevails at McCarran International Airport, where Aviation Director Randall Walker used to have some disdain for passengers who connected to other flights in Las Vegas because they didn’t spend any time or money in the city’s resorts. But today, he acknowledges that every passenger is valuable because they contribute at least something to the tax base.

The development authority says it has found California to be fertile ground for luring businesses because of its high taxes and what it calls its overbearing regulatory environment. The development authority is notorious for advertising on California’s turf to persuade executives to give Nevada a look and a new batch of ads have begun airing.

But if the development authority has a no-rent booth at the Convention Center and someone such as Schissler to make a pitch, it may not even need to advertise much.

Schissler even has some advice for cold-climate-based companies that could benefit from some sunshine: “When it’s raining sideways and it’s 30 degrees, it’s time to call the NDA,” he said.

More of the same

Visitor numbers, convention attendance and average daily room rate inched up a little in April, but gaming revenue was down for the month, an indication that travelers are finding their way to Las Vegas, but leaving their money at home.

Visitor volume was up from last year 0.9 percent to 3.2 million people for the month, convention attendance was up 2.9 percent to 426,697 and the average daily room rate was up 3 percent to $96.87 compared with April 2009.

It was the second straight month that all of those indicators were up.

Meanwhile, the city’s occupancy rate was down 4 percentage points to 84 percent, a reflection of the increase in room inventory, which was up 5.9 percent to 148,891 rooms.

Traffic on I-15 at the California border was off 1.1 percent to 40,619 and the number of airport passengers fell 5 percent to 3.4 million. Meanwhile, traffic on all major highways to Las Vegas was up 2 percent to 89,616 vehicles.

That shows that other markets ran a little stronger than Southern California in April. The offset in air traffic is partially a result of fewer passengers connecting to other flights in Las Vegas as a result of the pull-down of flights by US Airways.

Clark County gaming revenue fell 6.1 percent to $690 million for the month with Strip revenue off 0.9 percent to $437.3 million, downtown Las Vegas off 9.1 percent to $41.2 million and Boulder strip down a whopping 25.5 percent to $56.8 million.

Maui flights

Honolulu-based Hawaiian Airlines will begin twice-weekly nonstop flights between Las Vegas and Maui beginning in October.

Hawaiian, which currently has 18 flights a week between Honolulu and McCarran, will begin flying routes to and from Kahului Airport on Oct. 3. Flights will leave Las Vegas on Sundays and Wednesdays and return from Maui on Mondays and Thursdays.

The airline will use 264-passenger twin-engine Boeing 767-300 jumbo jets on the route. The airline is taking delivery of three new Airbus A330-200 jets later this year, giving it more flexibility in serving the Las Vegas market, executives said. A spokesman said one of the new Airbus planes would be committed to a Las Vegas route when it arrives.

“We’ve known for a long time how popular Las Vegas is with Maui residents, so we’re pleased to offer this new flight to address that demand,” Peter Ingram, executive vice president and chief financial officer of Hawaiian, said in a news release. “At the same time, we believe the convenience of this new nonstop service will boost visitor traffic to Maui, as Las Vegas is home to so many people with strong ties to the islands as well as a busy hub for flight connections on other carriers.”

Boyd Gaming Corp., which operates several properties in Las Vegas, has successfully marketed its brand to Hawaii residents for years.

Maui is unserved as a nonstop destination from McCarran and it would become the 134th nonstop market at the airport. Aloha Airlines, which discontinued operations in 2008, once flew the Las Vegas-Maui route as did US Airways.

The new Maui flight will leave Las Vegas Sundays and Wednesdays at 6:25 p.m., arriving at Kahului Airport at 9:25 p.m. Return flights leave Maui Mondays and Thursdays at 8 a.m., arriving at McCarran at 4:35 p.m. Las Vegas arrivals and departures will be about an hour earlier when Pacific Standard Time takes effect.

Hawaiian didn’t announce any fares, but in a quick spin through the hawaiianair.com website I found a round trip from Las Vegas to Maui for $351.60 in November.

Immigration

Immigration reform supporters and Las Vegas Convention and Visitor Authority critics were quick to jump on comments made by authority President and CEO Rossi Ralenkotter at this month’s board meeting.

Ralenkotter said the authority’s legal resources would be used to fight efforts to put an initiative that would enable voters to consider the Nevada Immigration Verification Act on the 2011 ballot. The initiative was supported by defeated Republican U.S. Senate candidate Chad Christensen and mirrors Arizona’s controversial immigration reform legislation signed into law earlier this year by Arizona Gov. Jan Brewer.

Because organizations have responded to Arizona with boycotts and convention cancellations, Ralenkotter and tourism leaders across the country are nervous that their lawmakers could be the next to adopt immigration reform that could lead to boycotts of their states.

Critics questioned whether the authority board — a quasi-governmental conventions and tourism bureau comprised of private-sector leaders and elected officials — could fight an initiative because it’s funded by room taxes.

Spokesman Vince Alberta clarified that the board can’t challenge the concept or ideology behind the initiative, but it can challenge the validity and legality of the proposal. It also can’t run ads against the initiative.

So the authority will have to walk a thin line in how much it can do to keep the initiative off the ballot.

Ralenkotter said Phoenix has lost more than $90 million in convention business this year as a result of boycotts and protests against the state. With convention and trade show business finally starting to pick up in Nevada, Ralenkotter said it would be detrimental to Las Vegas for Nevadans to approve similar immigration reform.