A casino of collaboration opens in Las Vegas By Ken Adams, CDC Gaming Reports March 28, 2021 at 10:30 pm As of March 25, Las Vegas has a new resort-casino, Virgin Hotels. It joins Circa, which opened in October, and Resorts World Las Vegas, scheduled to open later in the summer, as the COVID casinos of 2020-21. During the pandemic, the three resort projects continued construction, opening later than planned, but still opening. Staying on course was a test of the will and commitment of the developers and their financial backers. Some observers think the timing is perfect. Las Vegas is starting to come back. Every month, the number of visitors increases, hotel occupancy and average room rates improve. The governor is reducing the restrictions that have hampered entertainment and conventions, while conventions and entertainment are beginning to announce a return. Nationally, airline travel is also coming back and that may be the most important indicator for Las Vegas on its road to recovery. Rendering of Virgin Hotels Las Vegas Virgin Hotels Las Vegas is not exactly new. It’s a remodel, a remake. It opened over the bones of the old Hard Rock Hotel and Casino. The Hard Rock debuted in 1995, and while there had been a Hard Rock Café on the property, the hotel was the first under the Hard Rock brand. From its beginning, Hard Rock was known for its entertainment, vibe and edginess. Its nightclubs and poolside activities pushed the limits of existing entertainment norms and the patience of the Gaming Control Board. Its entertainment and social aspects often set the standard for the rest of Vegas. It did have one major drawback: It was not on the Strip and not part of the typical traffic pattern of Vegas tourists and gamblers. Still, it was popular. As a consequence, the property was almost constantly adding hotel rooms. Hard Rock did have some financial difficulties caused by the expansions, its location and the focus on entertainment and not the casino. The casino was never the most important element in the mix and that showed in the financial performance of the property. The Hard Rock was sold and resold over the years. In the 26 years of its existence, the original Hard Rock concept became fuzzy and confused and the name lost its luster. Enter Virgin Hotels; Virgin is the brand of Richard Branson. Like the original Hard Rock franchise, Branson wants to push his brand into every corner of the business world, including airlines, hotels, music, retail and even trips into space. There are ten Virgin Hotels in existence or in planning in the United States with one planned for Scotland. Branson rarely owns anything completely. He is a partnering kind of guy and Virgin Hotels Las Vegas is a partnering kind of place. The Las Vegas hotel will have the Virgin brand, but it will also be one of the Curio Collection by Hilton – a high-end Hilton brand. The sports book will be operated by an English bookmaker, Betfred. AEG will handle entertainment and, of course, there will be separate restaurant and retail operators. The casino will be called the Mohegan Sun Casino, managed by Mohegan Gaming and Entertainment (MGE), a business entity of the Mohegan Indian Tribe of Connecticut. The tribe operates its Mohegan Sun Casino in Uncasville, Connecticut. It is by law an Indian casino, subject to federal regulations and a tribal-state compact with Connecticut. But its other operations in Pennsylvania, Atlantic City and now Las Vegas are operated under state gaming regulations and are not “Indian casinos”. The Mohegan Sun Casino in Las Vegas is subject to the same laws, regulations, and conditions as any other casino in Nevada. Virgin Hotels is not owned by Branson’s Virgin Group. JC Hospitality is the majority owner of the property; it is partnering with Juniper Capital, Virgin Group, LiUNA, Fengate Asset Management, Dream and Orlando Development in the property. All the partnerships spread the risks and responsibilities, but also provide some synergies. Richard Bosworth CEO of J.C. Hospitality, believes that is a huge marketing advantage. Bosworth says that the combined databases of Virgin, Hilton, Betfred, Mohegan Gaming and the old Hard Rock could be as large as 200 million. He thinks that will make the difference between his property’s future successes and the initial struggles of the Cosmopolitan Las Vegas. Like Virgin Hotels, the Cosmopolitan opened in the aftermath of a financial downturn. When it opened in December 2010, Las Vegas was still suffering from the fallout of the Great Recession. Unlike Virgin Hotels, it did not have a database. It was forced to build one from the ground up. Virgin Hotels may or not may not be a success. But it has some important elements for success in today’s casino industry. It has a database, though whether it consists of 200 million potential customers is another matter. As Harrah’s proved to the industry in the 1990s, a large and qualified database is an important element in operating a successful hotel-casino/. Virgin will be calling on the customers of the partners to come to Las Vegas for a visit. If they do come, the property will do very well indeed. Virgin also has expertise in each of the important areas — entertainment, casino, hotel and finance — and that should be an advantage. Of course, they need to work as a single unit, not separate and competing units; that may be a challenge. A real estate investment trust (REIT) is not part of the mix and that is unusual in today’s casino world. Very few major casino operations in the country are not part of a REIT. However, it is an open option. If the property struggles, selling the real estate and leasing it back would be a good way to raise some capital and reduce expenses. But for the moment, it is party time and people in Las Vegas do seem excited to welcome the new resort. The opening was not exactly Mirage-like with Frank Sinatra and a host of A Listers, but for the times, it was good. And the national media was watching; that is always good for Las Vegas.