SEARCH NEWS:

 

Mandalay Pumps Up the Brandwagon

LAS VEGAS -- The idea man at the Do-it-Ourselves company thinks Mandalay Resort Group has done it again.

President and Chief Financial Officer Glenn Schaeffer thinks the enhancements under way at flagship Mandalay Bay are creating the Strip's most powerful resort complex and brand.

"We are the most cited brand on the Las Vegas Strip," said Schaeffer. "All will benefit by the aura of (the improved) Mandalay Bay. We're raising prices at Mandalay Bay, yet this has not been a fat moment (for the economy). When the brand performs as well as it has under challenge (from economic conditions), we feel good about where we'll be when the wave (of prosperity) returns. The wave is unstoppable, and we're poised to ride it."

Mandalay Bay opened a $236 million convention center earlier this month, a move Schaeffer expects will markedly improve nongaming revenue.

Next up is the 1,125-suite hotel tower now under construction in the space between the property's theater and parking garage.

The tower's suites will give Mandalay Bay a total of 4,825 rooms including the Four Seasons, making the hotel the city's second biggest behind the MGM Grand's 5,034 rooms.

Slated to open in November with a separate theme, the $250-million tower will carry a separate, yet to be announced name that will end in the phrase "at Mandalay Bay."

Each suite will be twice as wide as a standard hotel-room bay, will have luxury bathrooms and plasma televisions.

The tower will have its own separate identity, slightly less themed than Mandalay Bay, including a separate, lush spa on the ground floor. A restaurant and nightclub is planned for the top of the tower, and guests will have access to a private section of Mandalay's outdoor beach area.

"Less theme, more style," was about all Schaeffer wanted to say about the decor.

The property's long-delayed retail component will feature high-end boutique retail stores, and will link Mandalay Bay to Luxor when it opens at the same time as the all-suite tower.

Mandalay Resort bosses expect the recently opened convention center to fuel additional midweek spending, raising average room prices and occupancy rates.

"We'll book 56 shows this year, and that's in our first year," Schaeffer said. "These big shows are on multiyear contracts, and 2003 is likely to be a weak corporate travel market, but we expect to do well."

Schaeffer said Las Vegas in general, and Mandalay's new center in particular, have a pretty easy time luring conventions from other markets.

"Most of the competing convention cities offer publicly built spaces that date to the '70s or '80s," he said. "They're built on low bid, industrial specs, while Las Vegas, and Mandalay Bay in particular, has luxury product. The generation gap between meeting space is large, and we expect to benefit. In the entertainment business, new is very important. New makes more money than same old, same old."

Las Vegas conventions offer a wider array of restaurants, the ability to house large numbers across a portfolio of distinct price points, he said.

One executive for a competing Strip operator said Mandalay Bay's missing component is the lack of a big-drawing production show.

"They're a little risk-averse," said the executive. "When the company shifted gears (from its roots as a slot-centered grind joint at Circus Circus) and tried to sell experience rather than value, they weren't willing to spend the money needed to generate a Wow! factor."

Instead of spending $90 million like Steve Wynn did to open Bellagio with "O," Mandalay Bay's tried the musical "Chicago" and the "Storm" production show. Neither was a hit.

"There was a missing piece," Schaeffer acknowledged. "Did we need a more forceful and exciting show? Yes."

"Mama Mia!" the Abba-scored Broadway show slated to open in February, will succeed in Las Vegas, he said.

"We think we have a hit on the way." Schaeffer said, while noting the property's other, more successful entertainment options, including Shark Reef, championship boxing, arena concerts and the House of Blues.

< Gaming News