Occasional S&G contributor Jeff in OKC shares some blunt sentiment about this week’s biggest story: the planned sale and demolition of the Riviera, the most venerable casino on the Las Vegas Strip:
I’m 56. A 100% pure Baby Boomer, born in 1958. A couple of images from my childhood came to mind when I began to read the rumors about the sale of the Riviera. When we were in grade school, teacher would check out a projector, and we would watch 16mm wildlife and scientific documentaries on that “projector/screen in the same cart thingie.”
One was about the Labrea Tar Pits, which, best I can remember, are in the Los Angeles area. Seems that in Prehistoric Times it used to be an area that had these pools of tar, and a giant, elephant-type beast called a woolly mammoth would walk into them and get trapped like they were walking into quicksand. I think they had excavated some bones and had a display set up out there. For some reason, I most vividly remember some charcoal sketches of the mammoth sinking into the tar, with its mouth open in a panicked roar, head pointing to the heavens.
Another was about the “Survival of the Fittest” in Africa. It showed lions and other wild animals in their natural habitat. The lions would kill and eat smaller and lower animals. King of the beasts, and all that. One thing that stuck out was how old and sick lions would be away from the pride and packs of Laughing Hyenas would sneak up and attack them. Running up and biting them in one area, then running just out of reach while another would sneak up and bite them in another area, until eventually they would weaken the lion enough that it could no longer fight them off. Then the feast was on, as the Laughing Hyenas would rip the lion apart and feast on it’s carcass. Laughing, like hyenas do, I’m sure. Hyenas gotta eat too, you know. Eco system; Survival of the Fittest, and all that. You know?
I’m sure the Las Vegas Convention & Visitors Authority is going to make a Grand Pronouncement about how Big their new Mega Pimp 2000 project is going to be. How it is gonna create 6,000 jobs. How it’s gonna cost $2.5 gajillion dollars. How it’s gonna bring 50-75 new conventions a year to Las Vegas. How they had to reject 10 conventions last year, and if they had the new Mega Pimp 2000 facility in place they coulda broke the 41 million visitor mark last year and 45 is just around the corner! They will have the Clark County Commissioners, and other elected officials on stage with them, all smiling and waving. Then they will mention how sad it is to have to tear down the Riviera, but it had to be done. Progress, and all that. Don’t you know?
But, here’s the thing: They killed the Riviera. Slowly. They’ve been plotting for years to do this. Maybe not at first. At least, not directly. But, the County Commission has voted, time and 
again, year after year, to allow neighboring properties to be razed and new projects to be planned. Almost without fail, every one of the proposed projects never got finished or opened! The Riviera got isolated from the pride. Old and out by itself. Along with the leading businessmen in the state, the Commission decided it was a good idea to level Wet ‘n Wild water park, El Rancho (among other names) casino, Westward Ho, Stardust, La Concha hotel, El Morocco, Debbie Reynolds/Greek Isles/Clarion, and the New Frontier. Maybe more. And not one business opened on those sites! NOT ONE! That is how you wind up with an isolated casino that will probably be described as “no longer viable in today’s competitive casino business climate.” Get the old lion isolated, let it get hungry and weak, then attack from eight directions. It doesn’t stand a chance.
Here’s the part that’s even worse; We’re Paying To Kill The Riviera.
You and me. The Mega Pimp 2000 project is being paid for with taxes levied in the resort 
corridor. Make the visitors pay to build a bigger convention center, then we can charge them higher room rates and higher booth rates for our improved convention space. This is being done by libertarian Nevadans. The no-tax Westerners. The people who moved to Nevada from “Back East” because they like the low taxes and nice weather. The people who are filling up the Sun and Review-Journal comments threads about “Not one penny of public money should go toward the soccer stadium!” These same people think it’s just fine to tax the hell out of visitors, buy and close private businesses, and build more semi-government facilities.
Another Heartbreak: Good, And-Well Intentioned People Are A Part Of This.Barry Sternlicht of Starwood Capital has owned both Caesars World and the Desert Inn at different times in the 1990s. He became known for selling both properties just before the boom, and hoped that buying the Riviera would be a good purchase and could be turned around. Diana Bennett of Paragon Gaming is the daughter of Circus Circus (and later Sahara) legendary operator Bill Bennett, and certainly hoped that running the Riviera would be a chance for her to show her abilities on the Strip in her own right. Derek Stevens (and brother Greg) has held a minority stake since around 2000, has to have had zero desire to realize no financial gain from his 20% or so, after 15 years.
Has The LVCA Gotten Too Big For Their Britches?
The LVCVA doesn’t really need all of the Riviera — they want it. They could find a way to leave the Strip-front casino floor with a small hotel above it. Probably a money-loser, but is would 
preserve an icon of the Las Vegas Strip. They could buy the La Concha and El Morocco property immediately to the South and use that Strip frontage. But they don’t want to. I wonder if they have a secret (or not-so-secret) resentment of the casino part of Las Vegas? They might be proud of having torn down the Landmark, and could have a plan to put the Riviera logo on the wall of their main offices, as well (kinda like big game heads). Do they forget it’s named Sin City? They appear to be dying to have a presence on Las Vegas Boulevard. But, only if they can tear down a “Danny Ocean’s Five” casino? The only one of the five still left with any part of the movie filmed in it? Why do they NEED to do this?
They Are Throwing Neil Scartozzi Out On The Street.
Don’t know Neil Scartozzi? Google his name. See the pics of the Vietnam veteran and his business. The oldest continuously operating business under the same name and ownership on Las Vegas Boulevard between Mandalay Drive and Sahara Road.
Thanks for giving Jeff a place to post his thoughts. Great article.
The writing has been on the wall for the Riv for many years. Had the various resorts and condos that were planned in the area happened, the Riv would have been behind the 8 ball and would have likely been redeveloped in order to compete with the newer resorts. Even MGM was giving serious thoughts to redeveloping Circus Circus in order to compete with the planned resorts on the North Strip. Then when the boom went bust, it left the Riv, Circus Circus and Sahara as an island in a sea of stalled projects. When the Sahara was sold to SBE/Stockbridge, there were plans to significantly update the property, including a new tower. The money wasn’t there and eventually the Sahara is confined to the dustbin of history as the owners opt to rebrand it as the SLS. Circus Circus chugs along because they occupy a niche that keeps their rooms filled without having to resort to putting room deals up on Groupon. That end of the Strip is for all practical purposes, dead. I don’t think that the Riv could have stuck it out until the first phase of Resorts World opened up.
The Riv could have easily thrown in the towel back in 2010 when the company filed for bankruptcy. Their financial issues even post-bankruptcy have been mentioned in some of their SEC filings as well as some pieces here. Better to bail out now and get some money than to keep the property open and potentially lose it all when there’s little option but to liquidate. While Starwood Capital has the means to keep the place open, they’re also not in the business of keeping wrecks afloat.
I’m not really understanding why Jeff mentioned me in his conspiracy-laden rant. I’m also not sure why it matters whether I’ve weighed in on the Riviera news, but his comment that I’ve stayed pretty quiet is nonsense. We spent 10 minutes of the first 20 minutes our 75-minute podcast this week talking about it. This is on par with how much time we typically about how much time we spend talking about any major story in a given week.
It’s fairly clear from Jeff’s many theories that his mind operates in a parallel universe and has little basis in reality. I’d prefer he not drag my name into his poor attempts at backing up whatever crackpot theory he’s espousing next.
I kinda skimmed the article the first time and didn’t really understand the Tim/Chuck reference. After re-reading, I disagree with Jeff, Tim and Chuck have both weighed in plenty between VT/FHBM. Maybe Jeff’s just behind on his podcast listening?
To Las Vegans, the Strip is the town version of the coal mine or smog-spewing smokestacks, or (in a small town) the giant Wal-Mart Supercenter your city approves of because it generates civic revenue. I don’t know of a single tourist destination that isn’t generating revenue for it’s host tax base. That libertarian smoke (which is largely confined to outside of Clark and maybe Washoe) doesn’t discount that the business of a state doesn’t come without cost. It’s more based on the idea that if you’re taxing economic activity that nobody else wants/can provide, you’re not taxing gross material wealth. It’s about replacing equitable taxation with equal taxation.
Anyway, the LVCVA ultimately beats out some clown razing the place and building nothing. That’s my view. The redevelopment might be “boring” to people who consider a casino a must-have amenity for their time, but I’d argue the numbers show an excess of gambling available, and the convention business is still strong (see also: Sands.)
The five cents of the room tax that goes to the Las Vegas Convention Center has been in place since the 1950’s. It was for the funding of the convention center and is still an active part of the room tax today. IF the convention Center board has been wise enough to manage that daily amount they receive, why can’t they spend it on property to enhance their facility? I see nothing wrong with it. By the way, the Riviera has been a declining property for more than 20 years. It is a hodge-podge of a property with severe preventive maintenance issues and needed to be torn down.
I, personally, will miss the Strip. Without a name-tag or bottle service, I no longer feel welcome there, even with $200K coin-in/year. I wish them the best of luck. I’ll be in Reno if I’m needed. I’ll have to take a connecting flight, but it’ll be worth it.
Unfortunately it looks like the Riviera was at the wrong place at the wrong time. Me and my friends had some great times at the Riviera when I lived in Las Vegas in the mid to late 90’s. RIP Riviera.