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Howard Stutz

Culinary extends olive branch to new owners of Cosmopolitan Las Vegas

5 January 2015

LAS VEGAS -- More than a year ago, Culinary union members stood outside The Cosmopolitan of Las Vegas and called visitors to the Strip resort names such as “scabs,” “beached whales,” and “losers.”

What a difference 14 months can make.

The 2,995-room Cosmopolitan is under new ownership following the resort’s $1.73 billion sale to Blackstone Real Estate Partners VII. In a statement after the deal was finalized Dec. 19, Culinary Local 226 officials praised the new management for keeping the resort’s workforce intact.

However, a contract between the union and The Cosmopolitan is unresolved.

The Culinary had designs on organizing the nongaming portion of the resort’s 5,000-person workforce soon after the property opened in December 2010.

However, a contract was never finalized. The Cosmopolitan’s previous owners, Germany-based Deutsche Bank AG, wanted to sell the hotel-casino and didn’t want a union agreement potentially holding up a deal.

That led the Culinary to protest at the property’s entrances and demonstrate along the Strip. On several occasions, thousands of union members blocked traffic lanes on Las Vegas Boulevard in front of The Cosmopolitan.

But with Blackstone in charge, the Culinary extended an olive branch.

Culinary Secretary-Treasurer Geoconda Arguello-Kline said the union was happy The Cosmopolitan employees who want union representation were able to keep their jobs and health insurance.

“We are committed to working with Blackstone to ensure that these workers have the opportunity to provide for their families,” Arguello-Kline said.

Blackstone Real Estate Partners VII is a division of New York City-based Blackstone Group, a multinational private equity investment fund. One of the company’s holdings is the Hilton Worldwide hotel chain, which has multiple contracts with UNITE HERE, the Culinary’s parent organization.

“Blackstone has a long and positive relationship with UNITE HERE, and we will make sure The Cosmopolitan (employees) continue to excel in providing the best customer experience for guests,” Jon Gray, Blackstone’s Global Head of Real Estate, said in the statement that was released by the Culinary.

In a separate statement released by The Cosmopolitan, Blackstone said the resort’s management “continues to negotiate in good faith with the Culinary Union. We feel we have been having good conversations on behalf of our (employees) and we are confident that progress will continue in a positive direction.”

After the resort opened, the Culinary conducted a card check for representation and a majority of The Cosmopolitan’s nongaming employees voted to organize. Preliminary talks were held, but a contract agreement was never reached.

One of the Culinary’s demonstrations went viral after an anti-union group released a video showing union members shouting down Cosmopolitan visitors and calling them names as they entered the property. Cosmopolitan employees participated in the protests.

Before taking over the resort, Blackstone named longtime gaming executive Bill McBeath as Cosmopolitan CEO, replacing original CEO John Unwin.

McBeath, the former president of CityCenter, told the Nevada State Gaming Commission in December, “I’ve never been more excited to be part of this property.”

In its statement, the Culinary quoted Cosmopolitan employees praising the property.

“Our hard work and dedication have made The Cosmopolitan a top destination on the Las Vegas Strip,” said Michelle Lisher, a beverage server at the hotel-casino.

The Cosmopolitan is best-known for its restaurants and nightclubs, including The Chelsea. The centerpiece Chandelier Bar in the casino is three stories tall.

Blackstone said the property collects 80 percent of its revenue from the hotel and food and beverage operations. The Cosmopolitan has two 52-story towers and a 110,000-square-foot casino.

The Blackstone division owns $81 billion in real estate assets globally.
Culinary extends olive branch to new owners of Cosmopolitan Las Vegas is republished from