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Howard Stutz

Cosmopolitan gets final licensing approval

22 October 2010

LAS VEGAS, Nevada -- Nevada gaming regulators on Thursday granted operators of the Cosmopolitan of Las Vegas final licensing approval, setting the stage for the hotel-casino's opening in December.

The Nevada Gaming Commission, meeting in Carson City, took about an hour to approve the oft-delayed $3.9 billion development, which will open about 2,000 of its 2,995 hotel rooms on Dec. 15. A grand opening celebration is scheduled for New Year's Eve weekend.

German-based Deutsche Bank is operating the Cosmopolitan through a wholly-owned subsidiary. The investment firm took over the half-finished property for $1 billion when New York builder Bruce Eichner, the original developer, defaulted.

Gaming Commission Chairman Peter Bernhard said Deutsche Bank "could have cut its losses" and not completed the Cosmopolitan when it foreclosed on the development.

"It looks like this was turned into a beautiful property," Bernhard said.

Cosmopolitan Chief Executive Officer John Unwin, in a presentation similar to the Gaming Control Board on Oct. 7, said there was a market on the Strip for the Cosmopolitan.

The Cosmopolitan struck a deal with Marriott International, which will list the Cosmopolitan as part of the hotel chain's luxury resort Autograph Collection.

The move gives the Cosmopolitan access to Marriott's rewards program, considered one of the lodging industry's largest customer databases with more than 32 million members. Marriott will market the Cosmopolitan on its website and on the website of the Ritz-Carlton, a Marriott brand. The relationship allows Marriott customers to use their rewards points at the Cosmopolitan or earn points for their stay.

The Cosmopolitan, which sits on 8.5 acres on the Strip between Bellagio and CityCenter, will have a 150,000-square-foot casino, more than a dozen signature restaurants, and three rooftop pool venues, including one managed by a nightclub operator.

About 2,200 of the Cosmopolitan's hotel rooms have terraces overlooking the Strip.

The Cosmopolitan is expected to employ 5,000 workers.

On Wednesday, the Cosmopolitan released a list of nine luxury brands that will operate in the property's 36,000-square-foot retail area. All the shops are new to the Las Vegas market.

The stores include British brand AllSaints Spitafields, women's retailer Beckley, CRSVR Sneaker Boutique, denim retailer DNA2050, Molly Brown's Swimwear, Dutch housewares boutique Droog, eyewear retailer Retrospecs & Co., Stitched men's apparel and Skins 62 Cosmetics.

Unwin said the second-floor retail area is a small collection of stores rather than a mall.

Deutsche Bank representatives told the gaming commission that the investment firm spent $2 billion to finish construction of the resort, keeping some 3,000 construction workers employed. Many analysts have said the Cosmopolitan, once it opens, may be the last new hotel-casino on the Strip for years.

Deutsche Bank representatives said 216 condominiums at the resort are still under contract and the company is committed to closing sales of those units. The company halted condo sales when the property went into default. About 1,800 condominiums were under contract when the bank took over the project. In April, a settlement was reached with buyers who filed a class action lawsuit, in which about 60 percent of deposits were returned.