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As megaresort trend fades, companies focus on luxury in ?small? settings

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April 3, 2014

As megaresort trend fades, companies focus on luxury in ?small? settings

Hospitality News: Gondola Canal, Venetian Hotel, Las Vegas
Gondola Canal, Venetian Hotel, Las Vegas

Las Vegas is getting smaller.

That is, if you call 1,600-room and 1,100-room Strip hotels ?boutique? properties.

By the end of the year, Las Vegas will have about a half-dozen hotel-casinos that operators classify as ?boutique,? ?luxury? or ?lifestyle? in their marketing efforts.

It?s actually not a unique concept.

The Hard Rock and The Palms, for example, began as smaller hotel-casinos before expansions grew their room bases.

The idea was to break from the Strip?s megaresort business model ? 3,000 or more rooms and suites, multiple restaurants and entertainment venues, large retail and convention facilities ? for something a little more intimate.

Karie Hall, general manager of the 188-room Cromwell ? Caesars Entertainment Corp.?s entry into the boutique hotel market ? said personalized service is a balancing act. Customers of smaller properties want to be known to the staff, but they also want to be unknown so that the level of service isn?t smothering, especially in Las Vegas.

?A smaller property allows you to keep things new and fresh,? Hall said. ?You know a customer?s personality, their wants and what they dislike. And you also know the level of service to provide.?

FROM THE BEGINNING

Boutique concepts surfaced in different ways.

The opening of Mandalay Bay in 1998 brought with it a 424-room nongaming Four Seasons hotel. The rooms were tucked into floors 35 through 39 of Mandalay Bay, but Four Seasons? guests were given a separate entrance, lobby and amenities.

A nongaming 392-room Mandarin Oriental opened in 2009 as part of MGM Resort International?s 67-acre CityCenter development. The tower, which is separate from the complex?s 4,000-room centerpiece Aria, includes 200 residential condominiums on the upper floors.

THEhotel opened in 2003 as a smaller, nongaming alternative to the attached 3,300-room Mandalay Bay. The 1,100-room property had a separate entrance, larger rooms and the penthouse Mix nightclub and restaurant.

Mandalay Bay and the property?s attractions are just a short walk away down a corridor.

By Labor Day weekend, THEhotel will transition into the Delano Las Vegas, a renovation that will add features reminiscent of the 190-room Delano in Miami?s South Beach.

Matthew Chilton, who was appointed Delano?s general manager in January by MGM Resorts, said lifestyle hotels are not just about the size, but the specialized treatment for the customers.

?It?s a more personalized experience,? said Chilton, former vice president of hotel operations at Mandalay Bay. ?We?re not processing you, we?re tapping into you. What are you here for? What are your interests? In a way, we?re all trying to do that in Las Vegas.?

SLS Las Vegas ? a $415 million renovation of the Sahara ? opens the same weekend as the Delano and will look to attract a Southern California market and guests that owner SBE Entertainment has cultivated through its SLS-branded hotels in Los Angeles and Miami.

SBE also says it will provide personalized service to its hotel guests.

Meanwhile, The Cromwell, a $185 million renovation of the former Bill?s Gambling Hall, opens May 21. Caesars calls the property ?an upscale boutique? hotel-casino that features a 65,000-square-foot rooftop pool deck with an exclusive nightclub and day-club element with a view of the Strip.

?We want to bring the boutique hotel experience from start to finish,? Hall said. ?It begins in the porte-coch?re and when you walk in through the lobby to the front desk.?

Across the Strip at Caesars Palace, the 181-room Nobu Hotel recently celebrated its one-year anniversary operating within the confines of the 3,900-room Strip resort.

Nobu General Manager Gigi Vega, who spent 10 years in management with Mandarin Oriental hotels in Macau and Manila, said Las Vegas is embracing the concept of boutique hotels.

?The brands have been successful in other locations, but are coming into Las Vegas in a much different style,? Vega said.

Other gaming companies are said to be watching to see how this push into the boutique market works on the Strip.

Union Gaming Group analyst Robert Shore said customers that favor the ?hip/boutique hotels? will still travel to New York City, Los Angeles and Miami. In Las Vegas, customers favor brands such as Bellagio, Wynn and The Venetian.

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Source: Howard Stutz (2014). As megaresort trend fades, companies focus on luxury in ?small? settings, Las Vegas Review Journal http://www.reviewjournal.com/business/business-press/megaresort-trend-fades-companies-focus-luxury-small-settings published Mar 31, 2014. Viewed Apr 03, 2014.

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