The Top 5 properties that changed Las Vegas

With the closure of The Tropicana and the Mirage, two fixtures of Las Vegas Boulevard for decades, many are gazing reflectively at the evolution of the resort corridor and where the city is heading.  One of the characteristics of Las Vegas’ enduring popularity is reinvention, but in many cases the newest addition has not necessarily brought any innovation to the market. Indeed, when looking at the narrative of Las Vegas’ resorts, there have been very few that have significantly shifted the city’s business model or narrative.

In what is sometimes a contentious discussion, I have selected the five most important properties to open in Las Vegas and outlined my rationale for their selection. I, of course, welcome discussion on the subject and seek others’ thoughts to change my mind.

The Stardust (1958)

Tony Cornero wasn’t new to gambling when he conceived The Stardust Hotel and Casino on Las Vegas Boulevard. A veteran of illegal casino operations, Cornero had survived imprisonment, an inconvenient fire destroying his Downtown Meadows Resort and an assassination attempt, but the development and financing Stardust proved too much.

With the project in full flow, but without the requisite cash to complete, Cornero was to collapse and die at Moe Dalitz’ Desert Inn while playing craps in 1956. In a tale worthy of Hollywood, John Factor (half-brother of make-up entrepreneur Max Factor) and his wife assumed control of the project on behalf of Dalitz, the project’s lead financier, and his associates. On opening on July 2 1958, The Stardust differed from the established portfolio.

With a thematic nod to the Atomic Age, rather than the desert environment of its competitors, The Stardust was the largest hotel in the world with 1,065 guestrooms located in a series of low-rise motel structures. The casino, operated by Dalitz’s associates, was set behind a strip adjacent car park, dominated by stylized signage that has become as iconic as the property. With the Riviera’s 9-story hotel tower overlooking the resort, The Stardust was not intended to compete with the aspirational product of the town, rather with an RV park, drive-in movie theater and Lido de Paris production show (rather than a headliner) dominated entertainment. This was the first Las Vegas resort not built exclusively to service Las Vegas aspirational gamblers, but to appeal to a more middle-class customer in scale.

As the property changed “ownership” many times, additions and expansions were made, including building new towers, but The Stardust continued to provide a major source of revenue to outside interests. Imagined as the mob-riddled “Tangiers” in the movie Casino, Frank Rosenthal hosted his TV show and launched The Strip’s first sportsbook at the property, which set the line for all sports betting in the town for many years. Indeed, after Sam and Bill Boyd assumed control of the property ending decades of alleged skimming, (before acquiring it in 1985) the property resisted going upscale, providing a solid customer intimacy strategy that they had employed in their local’s casino operations. The property was closed in 2006, imploded in 2007 and replaced by Genting’s Resorts World in 2020.

Many of Las Vegas’ earliest resorts were similar in pattern; developed to serve high-end gamblers and programmed accordingly, from a strategic perspective, the legacy of The Stardust, it is clear it provided an opportunity for the middle class – some may say mass market – to come to Las Vegas. From a gaming perspective, the scale of the resort and volume of gaming allowed for a lower volatility in gaming patterns than the competitive set, and the owners tailored the entertainment offering to meet the needs of that customer.

That the resort remained profitable, despite the skimming for decades, highlights not only the vision of the developers, but the manner in which many customers loyally embraced the offering, being suited more to their needs than the existing market offered.

Caesars Palace (1966)

Caesars Palace is not the most radical property ever built in Las Vegas, that honor goes to Sarno’s other brainchild, Circus Circus, but it is hard to argue that Caesars is not the most defining resort built in this city. Regular readers will observe my extensive commentary on Jay Sarno and Stan Mallin’s journey in fusing their influences outside Las Vegas to create something more fun, exciting and interesting than what existed in the gambling capital of the world.

On opening, newscasts featured the Greco-Roman themed resort, where everybody could be a Caesar, and thousands booked their trip to visit this unique global attraction. From the innovative landscaping, engaging architecture, unique design features and overall pursuit in providing pleasure, Caesars was indeed a Palace for indulgence. Moreover, it was designed not just for function, but to emotionally grab customers, pull them out of their reality and grant permissiveness in a curated cornucopia of elegance and escapism. And the world wanted to come and experience it.

Sarno did not last long at the helm, with the Perlmans acquiring the property in 1969. As businessmen with a broader operating understanding, the new owners added further towers and casino space, adding sporting events and other entertainment offerings. As Las Vegas grew, so did Caesars Palace, with multiple new amenities, including The Forum Shops, the Coliseum theatre and many new restaurants and nightclubs. The resort featured prominently in cinema, TV, popular culture and of course landmark events reinforcing its place in Americana.

Many in Las Vegas define their business as selling experiences. That is what Caesars Palace did first and best; it created an experiential fantasy, aligning both physical environment and programming, hardwiring the offering into customers’ emotional receptors.

Nearly 60 years after opening and with disparate ownership groups, many of its contemporary properties have faced obsolescence or implosion, Caesars Palace has continually reinvented the offering, while maintaining the original – and eternal – concept of pleasure and indulgence, standing as the emperor of Las Vegas. In many ways, nearly every casino resort that came after has featured a little of Sarno’s raw intuition, either knowingly or unknowingly.

The Mirage (1989)

For Steve Wynn and the Mirage, it was knowingly. Innovation and iteration were perfectly aggregated. Wynn had learned from his mentor, Sarno, who passed in 1984, watched how Boyd had made good at The Stardust and had hired Joel Bergman, the architect that cut his teeth in Kerkorian’s International, at the time trading as the Las Vegas Hilton.

After The Golden Nuggets in Las Vegas and Atlantic City and the aborted Victoria Bay project, and taking advantage of financing structures innovated by The Rivera’s Meshulam Riklis, the sale of the AC Golden Nugget and having assembled an ambitious leadership team that was to dominate the industry for decades to come, The Mirage came together to be the first megaresort in Las Vegas, with 3,000 rooms in an experiential thematic environment. The resort was meticulously planned to heighten human emotional responses to the physical environment and programmed for a customer that wanted more than to play – they wanted inspiration and aspiration.

“It’s worth noting that Steve Wynn gave Sarno credit for establishing the template for casino design: a spectacular entry, a sense of place throughout the property and the casino serving as the main artery for everything else with restaurants and retail ringing the spaces. Wynn once said that ‘if you could find an original Caesars Palace ground plan and overlay The Mirage, they’d be almost identical.’” Alan Feldman, longtime executive at Mirage and MGM.

The Mirage, with Siegfried and Roy’s influence throughout the resort, dolphins in the rear and landscaping throughout, the fantasy was pervasive. Moreover, the model worked as a new generation of customers found Las Vegas. The Mirage was the catalyst for the children of the Golden Age to discover Las Vegas. Between 1988, the year before the Mirage and 1990, one year after the property opened, visitor volume rose by nearly 22% and gaming revenues by over 30% equating to nearly $1bn, most of which is attributable directly to The Mirage. Gaming numbers were broken and matched by record non-gaming revenues, thanks to the thousands of occupied rooms, casual visitors, show tickets and restaurants.

The Mirage proved the case for the Las Vegas megaresort, paving the way for 14 new resorts to open in the subsequent decade, including the return of Kirk Kerkorian, with the 5,000-room MGM Grand opening in 1993 and Wynn’s own Bellagio in 1998, arguably the most iconic resort to open in the history of the city, but clearly iterative from The Mirage.

Between 1988 and 2000 Las Vegas’ visitation had doubled from 17 million to 36 million, and gaming revenues increased by 145% from $3.1bn to $7.6bn. The Mirage reinvented the casino resort, brought in an age of new investment, development, and a new generation of customer. Wynn’s place in legend was secured as Las Vegas became not just a boom town, but a boomer town.

The Venetian (1999)

Alongside the Palazzo addition, the 7,200-room Venetian make it the largest resort in Las Vegas. It also runs one of the highest occupancy rates and upper-tier ADRs. Moreover, it changed the business model for nearly every Las Vegas casino resort and the trajectory of the city.

Unlike casino owners of the period, Sheldon Adelson wasn’t a casino guy. He wasn’t even a hotel guy. He was a conventions man, building and selling COMDEX, parlaying his fortune into constructing The Sands Convention Center and latterly The Venetian hotel and casino, opening in 1999. The logic was that, if convention delegates would spend over $200 for a room in Orlando, Chicago or New York, why wouldn’t they do so in an all-suite property in Las Vegas, where $49 rooms were as ubiquitous as the city’s famous buffets. The Venetian had neither.

Although the LVCVA opened the original Convention Center in 1958 with the mission of filling midweek occupancy, For Adelson it was the primary business. His Venetian was the first fully integrated resort, with shopping mall, convention center, casino, showrooms and many other amenities planned. Unlike established resorts that operated vertically, at The Venetian, many units were leased and therefore operated by third parties.

In 1988, the year prior to the Mirage opening, the casino department generated over 57% of revenues across the Strip. This was 50% in 1998, 39% in 2008 and 34% in 2018, despite gaming levels increasing in almost every year. Convention visitation grew from 1.7 million in 1998 to 6.5 million in 2018 and conventioneers became the second-most important customer segment behind high-value gamblers.

Las Vegas today has over 10 million square feet of convention space, with nightclubs, restaurants and considerable outdoor space all utilized to meet the needs of the 22,000 meetings and conventions that are held in America’s convention capital. The Venetian was the first true integrated resort built where the casino was not the economic engine. Adelson pitched his conventions-centric model to regulators in Macau and Singapore, however his business model was skewed due to the surfeit of gamblers in that region.

The adage that you could take gaming out of Las Vegas and the city would be okay, but if you removed conventions, we would have a problem, was tested in the post-Covid market. In 2022, Sands sold the Venetian to VICI and private equity group Apollo for over $6bn. The pair recently announced a $1bn investment to the asset.

The impact of The Venetian is evident. Prior, casinos used non-gaming attractions as secondary revenue generators and to feed the casinos. Instead,  the Venetian saw those aspects as the core business. This focus on corporate business and non-gaming customers undoubtedly enabled the introduction of sports and other investments to Las Vegas, notably The Sphere, possibly the most exciting and iconic destination on the planet, and one connected directly to The Venetian.

The Cosmopolitan of Las Vegas (2010)

In the new century, Las Vegas was a winning bet. The Venetian’s success prompted the addition of the Palazzo, Wynn added Encore, MGM ‘s investment was in the $9bn City Center complex, Boyd imploded The Stardust to build Echelon and Elad cleared the site of The Frontier for The Plaza. The cranes and topped-out shells of Fontainebleau and Cosmopolitan were visible to all.

Corporate management had identified a need to capture the younger customers that could be found partying at The Palms and Hard Rock, but the unlikely hero of The Great Recession was The Cosmopolitan, completed by Deutsche Bank, who had assumed control of development after debt default by Bruce Eichner. Planned as an apartment complex with over 3,000 rooms, no casino database, and built on the narrow footprint of 8.5 acres, just slightly larger than the Bellagio fountains that it overlooked, operating this property was going to be a challenge.

The first property aimed squarely at Gen X, those born between 1965-1980, and defined as “The Curious Class” by property leadership. The resort had a different feel than the market counterparts. It was more… cosmopolitan, partly by necessity and partly by design. The design aesthetic was contrary to Roger Thomas’ Chinoiserie found in Wynn and Bellagio, rather architects Friedmutter, Rockwell and Arquitectonica emulated the contemporary notes found in density heavy locations. This appealed to customers that were comfortable with urban living.

Opening without a large showroom, up-and-coming talent was sourced, offering a smaller stage to the likes of Adele and Ed Sheeran, known to the cool kids but not their parents, who were accustomed to Celine, Rod and Elton playing at Caesars. Strategically, The Cosmopolitan used F+B as a revenue platform, as well a marketing one, bringing in acclaimed brands and dining experiences found in major international cities. Like many past projects, customers were challenged, how do you feel? The answer was young, cool and sexy. But the weren’t gamblers. Yet.

In 2015, Blackstone acquired the resort.

With new ownership came new management, and tweaks were made to the casino floor, additional gaming customer-focused room product was completed, a showroom was added and tenant changes were made. The younger customers discovered a Las Vegas for them, as their parents and grandparents had done, and like them, as their disposable income grew, they aged into gaming cutomers.

In 2009, the year before Cosmopolitan opened, 27% of Las Vegas Visitors were under 40, with an average age of 50. 22% were over 65. In 2023, this was 41% under 40, with an average age of 43.8. Only 8% were over 65. Today, when Ed Sheeren comes to Las Vegas, he plays at The Allegiant Stadium, and Adele has replaced Celine as the superstar resident at Caesars Palace. The market has moved.

The Cosmopolitan was the most visual catalyst in attracting the next generation of customers to Las Vegas, and they came in record numbers, securing the relevance of the city for another generation and ushering a new phase of development.

In offering these resorts as those that changed Las Vegas, we have a journey spanning generations, built by owners with a variance of experiences and backgrounds. In resort development today we can be overly myopic in looking at the existing market and seeking to replicate the existing offer, just applying nuance. This can be highly successful, but in doing so, the resorts must be better that the competitive set at attracting both customers and their loyalty. Many have failed at doing so.

However, by identifying a segment where there is unmet demand, whether by demographics, psychographics or functional need, there are always opportunities in the competitive environment of Las Vegas. Maybe, when reviewing this selection in a decade there will be another challenger in the next cycle, as the only certainty is change.

Oliver Lovat is the CEO of The Denstone Group, that offers strategic consultancy in casino and hospitality development. His research topics are Las Vegas Customer Behavior and The Evolution of Competitive Strategy Within Las Vegas Casino Resorts.

David Thompson

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