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Double-whammy for Planet Ho

Posted At : July 23, 2009 04:36 PM | Posted By : D McKee
Related Categories: Labor,MGM Mirage,The Strip,Current,Tilman Fertitta,Downtown,Regulation,Economy,Columbia Sussex,Station Casinos

True, Planet Hollywood is feeling some pain in the wallet after the Nevada Gaming Commission approved a $500,000 fine. But it's Clark County Department of Business License which fired the shot across the bow that will really get the casino industry's attention. By scotching the liquor licenses of both Planet Ho's Privé and Living Room clubs, it signed their death warrant. That, more than anything, ought to get scofflaw club owners and laissez-faire casino owners to clean up their act.

It's hardly an excessive move when you consider that the bill of particulars against Planet Ho's clubs included "drug use, prostitution, underage drinking and assault." Besides, if you want those things, perhaps you should patronize one of Las Vegas' many "gentlemen's clubs." Nevada regulators' concern about on-Strip prostitution is laudable, if tardy. When it was rampant at the Tropicana, gaming's policemen snoozed at their posts, otherwise known as "monitoring the situation."

If the message still hasn't sunk in, the Nevada Gaming Control Board's Randall Sayre sent out an "invitation" for casino executives and middle management to discuss a wide range of potential concerns. Gov. Jim Gibbons appointed Sayre to the NGCB with a mandate to beef up its law-enforcement role and Sayre's made good on it. (Even Midnight Jim has his moments of perspicacity.) It's good to see the spirit of Bobby Siller living on in Carson City.

"Damn those customers!" What do you do when business takes a not-unpredictable nosedive during a recession? Blame the customers, of course. At least, if you're Golden Nugget owner Tilman Fertitta, that's what you do. When times were good, Fertitta was bullish on gaming (which was essentially propping up his Landry's Restaurants empire).

Oh, what transformation a few bad quarters brings! Moans the Texas tycoon, “I feel very good about restaurant hospitality, I do not feel very good about gaming.” Hmmm, maybe you should have pondered that change of heart when you were proceeding with a new $150 million hotel tower (opening Aug. 1 Nov. 20) in the teeth of an economic tailspin?

As for the patrons, "discounted room rates appear to have attracted a clientele who are spending less on gaming and other amenities," harrumphs a company document. Yes, because in case you haven't noticed, we're on the verge of a depression. People have less money to spend. Period. Like many others like him, Fertitta needs to get hip to the fact that we're entering a period of diminished expectations. Shaking your fist at the rain isn't going to accomplish anything.

Other Fertitta scapegoats include MGM Mirage, for having the audacity to discount its rooms during the downturn. Sounding rather whiny, Fertitta utters, “You ought to go online and look at some of these rates and packages you can get. That is where we are just being murdered, trying to be competitive with the MGM and the Bellagio.”

Welcome to the NFL, man. And if you think -- with all due respect to the downtown Nugget -- that you're in the running against Bellagio or even the Green Monster, well, you're in a world of denial. I've not had time to read the last Landry's quarterly filing but, for once, it sounds like a real page-turner. 

Station wins one, albeit on a technicality. All parties involved will be back for a grudge match in local court.

Comments (Comment Moderation is enabled. Your comment will not appear until approved.)
Jinx's Gravatar Definitely a shot across the bow for the nightclubs, but didn't the Veneitan go through the same thing with it's first nightclub offerings? I forget what their names were.

Also great point on the GN owners, while MGM has had their problems with City Center the one thing I think people didn't take into account, is how much value they had with their properties, fact of the matter is anywhere outside of Wynn and MGM has them beat on some level, considering they were able to keep their rates high consistently across properties during the boom time, it was only a matter of time before they were likely to purge Harrah's customer base with better offers. After all during the boomtime Harrahs was still giving away rooms. MGM had a lot of room to move with their price to retain or even grow market share during the down time. And I think they are taking advantage of it. It's a shame that the other players did little to build customer loyalty during that time, rather taking the opportunity to gauge a customer base as everyone else was. Maybe a page from the past would have helped some of these businesses later. Cultivate a solid player base, and then fill the rooms with the rest you can get in the door.
# Posted By Jinx | 7/23/09 8:53 PM
David McKee's Gravatar The table game pit at The Orleans tonight was absolutely full. Packed. So if Tilman Fertitta were the owner there, would he be thankful for the patronage or would he curse the players for not betting higher? He bought into Las Vegas in mid-'04, at the start of a big upsurge in the market. I wonder if he's one of those CEOs who mistook some exceptionally good years for the norm?
# Posted By David McKee | 7/24/09 12:25 AM