The unthinkable is happening: Harrah’s, a Reno icon and the heart of the downtown casino core, will close. Caesars Entertainment and VICI Properties announced the sale of Harrah’s Reno on January 15th, and the buyer, CAI Investments, plans to close the casino and the hotel and create a mixed used housing, office and retail complex on the site called Reno City Center. In a fitting tribute to the significance of Harrah’s Reno, the Wall Street Journal published a story on the sale. Caesars is headed into a merger with Eldorado Resorts that is expected to be complete in the 2nd or 3rd quarter of 2020. Eldorado already has three properties in downtown Reno and does not need or want a fourth. No casino operator is likely to be interested in Harrah’s. It is a casualty of both the Great Recession and of Caesars’ bankruptcy; the property has millions of dollars of deferred maintenance and has not had been updated to compete in the 21st century.
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Harrah’s Reno has been a neglected stepchild for much of the last 30 years. With the advent of Indian gaming, the casino industry in Reno stopped growing and began to shrink. Harrah’s Corporation, Holiday Inn, Promus Companies, Caesars – whatever it was called at the time – always had better places to invest its money. And with the ongoing expansion of casino gaming nationally, Harrah’s Reno has become even more insignificant in the big picture. This century has been very dynamic for the corporation now called Caesars. Harrah’s Entertainment bought Caesars in 2005; three years later, in 2008, Apollo Management and TPG Capital paid $17.7 billion to buy the company. The deal had been two years in the making. In the interim, the Great Recession hit. The company was saddled with $25 billion in debt and struggled to meet its obligations. In 2010, looking for some branding magic, Harrah’s became Caesars. In 2015, the company filed for Chapter 11 bankruptcy. There were more twists and turns, but the most important of them was in 2019, when Caesars and Eldorado Resorts agreed to merge.
The financial struggles of Caesars put Reno very far down its lists of priorities. An investment in other markets, like Las Vegas, paid big returns; Reno offered no such prospect. The only thing Harrah’s/Caesars did in Reno was to cut expenses to the lowest possible level, which left a very distressed and out of date property in a very competitive and challenged marketplace. The new company, under Eldorado, has promised investors that it will sell underperforming properties. Clearly, one of the properties they’re talking about is Harrah’s Reno. It wasn’t attractive to a casino investor, but Caesars found a developer who believed in a new Reno, a Tesla-driven one. He plans to build something completely different. Something that might suit the new Reno.
It all makes business sense, but for the citizens of Reno, Harrah’s was more than a business and more than a casino. It was part of the community. Nearly every long-time resident family in the area has their own Harrah’s tradition. Phil Satre, the company’s former CEO, celebrated his 40th birthday in Harrah’s Steak House. A friend of mine celebrated his daughter’s high school graduation there, and three other friends have a decades-long tradition of a pre-Sheep Dip dinner there. Year after year, birthday parties, anniversaries and holidays were all occasions to go to Harrah’s. As was entertainment; locals remember seeing Sammy Davis Jr., Frank Sinatra, Tony Bennett, Phillis Diller and hundreds of other big name, top drawer, world-class entertainers at Harrah’s. Entertainers loved to perform in Reno because no one treated them better than Bill Harrah, and the audience got the benefit of that treatment.
Harrah’s was Bill Harrah’s casino; he came to town in 1937 and stayed until he died in 1978. In the first few years he was a bingo operator, trying to grow his business. After World War II ended, Bill Harrah started to build the best casino he could envision. Those things that he could not image for himself, he hired experts to help with; Harrah also traveled the world, staying in the best hotels looking for ideas he could bring back to Reno. Everything was as good as he could make it. Harrah set the standard for casino operators in Reno. His casino, employees, entertainers, restaurants, hotel and procedures were the gold standard by which casinos were judged.
For years, former Harrah’s employees were highly sought after, and not just in Reno. Harrah’s employees were known to be the best trained and most knowledgeable in the industry. Bill Harrah made certain that was true; he used consultants to develop the best procedures and training programs. Nothing was left to chance. The Oral History program at the University of Nevada, Reno published a history of the property called “Every Light Was On.” The title was a metaphor of Harrah’s operating philosophy; everything should be the best and always in perfect condition. On every eight-hour shift, the senior manager on duty would walk the property checking everything, literally looking to make certain that every light was on. And Lord help that manager if Bill Harrah found a light out. The community was proud of that tradition of excellence.
When Harrah’s/Holiday Inn sold the automobile collection in 1981, the city reacted with dismay. Harrah’s had no right to sell those cars, the argument went; they belonged to Bill Harrah. But more than that, they belonged to us, the residents of Reno. Now people are reacting the same way to the announcement that Harrah’s will close. You can’t do that, the argument runs. It belongs to us. But of course, Caesars can, and did, sell Harrah’s Reno. Its time has passed. Bill Harrah has been dead for 42 years, and the standard of excellence died long before the turn of the 21st century. This is the Tesla century in Reno. The Harrah century is over. The best of luck to CAI Investments and their City Center project, they are trying to fill some very big shoes.
