Goodbye Western, hello SLS … ?

Sometimes it’s better to be lucky than right: When Tamares Group made an indiscriminate splurge on downtown Las Vegas real estate in 2004, it was banking on a construction boom that never took place. It also found itself with several casinos and slot-route locations for which it never had any strategy. But Tamares sure was in the right place at the right time when Fremont East started becoming the place for trend-conscious locals (and some tourists) to hang out. For instance, if you’re enjoying an affordable, spicy meal at Le Thai, you are dining on Tamares-owned property. Also under Tamares’ ownership was the ancient and defunct Western Hotel, a locals casino that had long enjoyed (?) one of the roughest reputations.

Along came Andrew Donner (below), the transparent stalking horse for Zappos.com CEO Tony Hsieh, brandishing millions for the place. I guarantee you it didn’t come cheap: Hsieh has committed $200 million toward Downtown purchases and that’s created a seller’s market. I don’t have a per-acre breakdown of Hsieh’s $14 million price but Tamares surely made out like a bandit, even if it had to wait over eight years to do so. As for the Western’s fate, it’s not difficult to surmise: A few shoves with a backhoe, speedy debris removal and — voila! — Mayor Carolyn Goodman has the acreage she’s coveted for big-box retail, part of a long-range plan to make Downtown a place to live as well as work. This was a mother-of-necessity response to the Great Recession, making Tamares doubly fortunate. Gaming’s big winner is, of course, the El Cortez. Once relegated to the fringe, semi-obscured by a failed condo tower, it is increasingly at the center of the Downtown action.

In an unusual story, executives of SLS Las Vegas invited a Las Vegas Sun reporter to observe their ongoing demolition of the Sahara (farewell, Conga Room!). Yeah, hard-hat tours are commonplace in business journalism, but they’re held when you’ve actually got some new construction — however skeletal — to display. Gaining behind-the-scenes access this early in the renovation process is extraordinarily novel. I’m tempted to say it’s “unheard of.” Methinks sbe entertainment wants to reassure skeptics both locally and (more importantly) on Wall Street that it’s serious about making this happen. Also, Sam Nazarian was — when last I checked — at least $325 million short of the $750 million he needs to fulfill his vision.

So this is an elegant way of rattling sbe’s tin cup, as it continues to try and rustle up money. However, since Nazarian was willing to start work with only $415 million in the kitty, I suspect he’s got a Plan B: Open a Phase I of casino, amenities and limited hotel rooms, then wait for SLS LV’s performance to justify borrowing the money to finish the job. It’d make sense. Nazarian’s business strategy is iffy. And, as the project coordinator points out, SLS is used to working with 300-400 hotel rooms, not thousands. It may want to ease into running something of this magnitude.

The SLS executive team assembled by President Rob Oseland (pictured) inspires some concern. Both its CFO and vice president of human resources come by way of badly launched properties (CityCenter, Crystals and Hollywood Casino Toledo). Almost everyone else in the top echelon was formerly posted at Wynncore … which makes SLS a less-than-lateral move but you could incredibly far worse than to populate your ranks with veterans of Steve Wynn‘s resorts, especially if you’re pursuing an upscale demographic on the Strip. Nazarian’s understanding of the Vegas market has always been suspect but he’s staffing SLS LV with more up-to-date talent than he ever lavished upon the Sahara.

Although it’s months from integrating with Penn National Gaming‘s customer-loyalty, M Resort is already seeing the benefit of various “heartbreaker” changes made by property President Anthony Marnell III. The latter’s claim of “substantially better” financial performance has to be extrapolated from some pretty broad numbers. However, if that weren’t the case, would Marnell be talking about building out the remainder of the resort’s 90 acres? What I can’t figure out is his implication of a drastic revision in the number of gaming positions. M had 1,846 slot machines and 64 table games in 2010. Today, it has 1,800 slots and … 64 tables. Penn recently put literally hundreds of slots into storage in Maryland, so taking maybe 46 machines out of M hardly seems a big deal. However, that casino floor was a real hassle to navigate, so any Penn-inspired change is probably an improvement.