He's not the only one. A confluence of economic and demographic shifts have put the onetime lair of Frank Sinatra and Cher on a roll during lean times. And it isn't because vacationers want a stint with Lady Luck. Cheap lodgings and a shift away from family entertainment have made the capital of glam a top business stop. "Our conference and convention business is booming," says James J. Murren, president and chief financial officer of MGM Mirage Inc.
The boom follows years of something of an identity crisis for Vegas. The place flopped as a family destination during the early 1990s. So casino companies got back to selling glitz to business customers at the end of the decade. New hotels, such as MGM's Bellagio and Sheldon Adelson's Venetian, were built with fancier rooms, nicer restaurants, and expanded meeting facilities. That's snaring convention dollars from such cities as Orlando and New York.REALLY BIG SHOWS. True, Las Vegas has always had a lock on a number of large conventions. Businesspeople have to attend events ranging from Comdex to shoe conventions. "If you don't go to the big shows, people think you're struggling," says Christopher Watt, owner of the Aussie Dog Sheepskin Footwear Co. and a regular at Western Shoe Assn. shows in Las Vegas.
But Vegas has another card up its sleeve: It's cheap. A recent study by Bear, Stearns & Co. put Las Vegas at No. 9 among the 10 largest trade show destinations in terms of average hotel room rates. Meanwhile, Las Vegas ranked dead last in average meal cost.
The rest of the casino industry hasn't fared so well. While MGM's Las Vegas properties with large meeting facilities, like the Bellagio and The MGM Grand, enjoyed record profits in the second quarter, properties like the New York-New York Hotel & Casino, with relatively little meeting space, saw their profits slide. Furthermore, companies with more exposure to riverboat gambling and smaller markets also reported disappointing numbers in that quarter.
There's a good chance, too, that Las Vegas may eventually kill its golden goose. The Mandalay Resort Group is building a 1.8-million-square-foot convention center adjacent to its Mandalay Bay Hotel. And the Venetian is building a 1,000-room tower next to its Sands Expo Convention Center. "There's always a risk they are going to overbuild," says Thomas P. McIntyre, a money manager whose Dessauer and McIntyre Asset Management Inc. owns 1.5 million shares of Park Place Entertainment. For now, though, Las Vegas' bet on business travelers seems to be right on the money. By Christopher Palmeri in Las Vegas