March 12, 2021 Casino, Land-Based, Interview

WHAT IN THE WORLD

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We’re just a few months away from the most anticipated Las Vegas Strip opening in over a decade. On the site of the former Stardust, Resorts World Las Vegas, developed by Genting Group, is already making a massive statement in its scale, complexity and offerings despite convention saying it’s business suicide to go all in on a land-based complex of this ambition during a pandemic. But status quo be damned. In this episode of the GI Huddle, we catch up with Scott Sibella, president of Resorts World, who speaks about stepping up and standing firm in order to usher in a new era for the city.

What was the impetus to build a property of this scale in Las Vegas? Can you discuss the timing and the need for such a project?

Genting is our parent company out of Malaysia and we've been in the hospitality business for over 50 years all over the world. So this is a big project for Las Vegas of course, and for us, but we've done big projects like this in other areas. And the goal was always to bring Genting to America, and to Las Vegas. That was the founder’s goal. The company has done some big projects in all different types of hospitality businesses, and we just thought it was a perfect time to bring a property at this level. It's been over a decade since Las Vegas has seen anything like this in the city, so it's going to be refreshing and something that's good for Genting, and also good for the city of Las Vegas.

 

How did Genting get involved in the project and how has it strengthened its presence in the US?

We've been in New York for many years. We have a casino there that we operate with the government of New York and about two years ago we built up a property in the Catskills, which was going well. Things were starting to take shape and then of course COVID hit. So we're getting through that. It was perfect timing for me because I've been in this industry for many years and was with MGM Resorts. An early retirement programme came out and it was good timing to leave there on good terms and join our chairman KT Lim at Genting. I’ve been here about almost two years now. It was good for me to get some insight about the city when it comes to running casino properties. So we made a few changes. He allowed me to do some things to make the property easier to flow through and with some design elements. So it didn't hold us up a lot but it did move us to the summer of 2021, and we're on schedule
to open then.

 

What was the impetus for the theme of Resorts World? How did that come to fruition?

In the early days when Genting was looking at different ideas on the building and the architecture and design, there were a lot of things thrown out there. It was never an Asian theme; we’re not just after Asian customers. We would never do that. We're an Asian company, yes, and we know we're going to get a lot of Asain clientele, but it's a very traditional, modern-themed property. It has an Asian feel to it when it comes to maybe some of the art, restaurants and some of the color palettes, but there's no panda bears or Great Wall of China.

 

Was the location always something strategically in mind? Why was that part of the Strip particularly attractive to you to settle there?

We really like the north side of the Strip. It may not happen overnight, but we know things are going to start shifting this way. They are all luxury properties, so we love being associated with the Venetian, the Wynn, and you’ve got the Mall right there, and Sahara has done some great things to their property. So we know it's going to continue to come this way. We like that we have all this land, around 88 acres, and we're only building on two thirds of that. So we have plenty of opportunity for future development, which is part of our plan. We really want to be the first integrated property on the Strip that really is integrated, where you don't have to leave this property because of everything that we're creating and programming within Resorts World.

 

In terms of attractions and offerings that you're going to have, how do you see it really transforming not just that part of the Strip, but the city in general?

I think, as I mentioned, there hasn't been anything at this level in over 10 years. It's going to be a long time before you see another property like this built in Las Vegas. We are adding everything we possibly can add. So there's a 5,000-seat state-of-the-art theatre and plenty of other attractions. It's going to be a must-see property because of how we're programming it. There’s a lot of secrets I can't tell you about, the restaurants we’re building and some of the attractions, but we're going to open with 3,500 rooms. There's going
to be plenty of food and beverage outlets and nightlife experiences and, again, everything that we learned in the past and with many years in Las Vegas, we're building into this property, and we're designing more of a property that's going to be a non-gaming property.

It's been a paradigm shift here in Las Vegas. We think 70% to 75% of revenue will be non-gaming. So casino is somewhat of a second part of what we're building. Yes, we're going to have high gaming areas and we're going after that high-end customer in Las Vegas, but the casino part of it is just another part of the property. We're concentrating more on what we can do for non-gaming patrons who come to Las Vegas and want the retail experience, the entertainment experience. That's our plan.

 

And of course the elephant in the room is the pandemic. How far into construction were you before that hit? I think you've been constructing for maybe two and a half or three years.

Yeah, things were just starting to really take off, and we built our team up and we had over 4,000 construction workers and then the pandemic hit. But we never came to a stop. We were very fortunate. We played by the rules, had great guidelines and we got down to about 1,500 employees. But today we're up to over 4,000 construction workers. So it slowed us down, and we had to figure out how to do it the right way, like getting people in the elevator to get up to the certain areas. And when you do construction you're usually in teams and pairs so we had to follow the protocols. But we were doing a good job with it and we caught up, so again we're still on schedule to open this summer and we’re fighting our way through it.

 

So there weren't any alternatives, other than just forge ahead and see to its conclusion?

Yeah, and a lot of things that we're experiencing with COVID we were already taking into consideration from the beginning. So airflow is a good example. We wanted to have the cleanest air on the Las Vegas Strip, not because other properties can't do it, it's just more difficult because of their infrastructure. So again, here we are 10 years later, asking about what the best systems out there are to get the best, cleanest and safest air in the rooms throughout the property and so forth.

So that's something we were working on, and here it happens today that's what we're all talking about; so that was already in place, and the technology we're using on how you don't have to interact with employees was always a plan. Every decision we made had to do with technology; what can you do in today's world that you couldn't do years ago. So we're just taking advantage of all the new things that are out there.

 

After completion, of course, the $4.3bn property will be the most expensive on the Strip. Can you give us some context in terms of ROI considering data from the LVCVA currently showing that tourism numbers are at record lows and there are midweek closures. How are you going to be able to attract a lot of footfall to make sure it's viable?

There are two answers to that. The first one is we're learning that the properties on the Strip are doing okay through COVID. They’re playing by the rules and they're still cash flowing positively, so we like to see that. We know if we did open and we had to open under certain guidelines – which we think will be behind us – I do know the city is very resilient. We’ve proven ourselves in the past that this city will take off much faster than other cities because of who we are. So we think that summer is going to be a good opportunity for people to get back to having fun. No, the convention business won't come overnight, but we think it will be strong this summer.

When it comes to cash flow and who our competitors are, we're going after everybody. So our rates will be just as good as Wynn’s and Bellagio’s, but at the same time we want the Treasure Island customer to come to our property. It will be one of the top properties on the Strip when it comes to generating cash flow, that's our goal.

 

And of course you mentioned conventions. Do you see those returning the same way that they did? They historically have been very important to the city, so how much space have you dedicated to the conventions once they return?

The convention business is very important to us. It's a strong segment. Again, one of the reasons why we like this location is because of the new Convention Center. It’s right across the street and it’s completed now. We worked out a deal with The Boring Company so we will be one of the first properties to connect when we open. You go downstairs and you're at the convention centre in three minutes. Convention business was always top of mind. We'll have over 300,000 square feet of convention business, and we think we’ll do very well with it because of the proximity of our property and the Convention Center and how things will continue to shift down here.

 

Summer is coming up soon. Regardless of how difficult the year has started, what are the last things that have to be put in place before you open?

A lot of sleepless nights. It’s got to the point where you just hope everything's going to work when we say it's going to work. We’re getting down to that point where it's like a baseball game. You're in the ninth inning now and there’s no turning back. So we're in the process of testing systems and making sure everything works, and tightening up the budget. We're still on budget, we're still on time, but every day is a challenge. You just have to stick to those critical paths and hit those days. The good thing is we're opening this summer. I can’t say we can select the date, but we're really watching closely what's going on down on the Strip and with COVID. And we really hope things improve in the next 90 days, so we can see that it's going to get better and we can plan our opening. I don't want to open at 50% of these protocols. We really hope it does get better, but there's a lot of hard work now and we're at the point where things have to work the way you planned it. But we're excited to open this summer and we're excited to bring this beautiful jewel to the city of Las Vegas.

 

Are you planning a big grand opening? Is it going to be a massive celebration?

We’re still working on it. There's going to be a lot of openings throughout the summer but we're working on planning on how we're going to do it. But I really am excited about some things that we'll be announcing in the near future: our entertainment lineup, our restaurant lineup, and some other great attractions. There's a lot of must-see things here at the property when it comes to art and attractions and things like that. I'm really excited to showcase that to the city and the visitors, and we know people are going to want to come down here and see what we’re building.

 

So far it sounds like a case study for perseverance. What are you looking forward to most on a personal level?

I know what we're building is special. I've been doing this a long time and it really is something great. It's not only great for Genting, but what I keep talking about is how great it is for the city. I just think it's going to help us rebound faster, we're going to create all these jobs, we're probably one of the largest private construction jobs in the country. I'm glad and happy that we can hire some of the people who have been let go. That's all we read about every day. You can't blame the properties because there's just no business. So I think it's a good story that 6,000 employees are going back to work within the city. We're close to 80,000 people that have applied. I wish I could hire all of them, but it's nice to know that we’re hiring some of them. We're going to hire vendors, and everybody's going to have to supply us with things; so it's a good story that a property like this is opening in the city and I think it's going to be perfect timing for all of us.

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