Vegas tries for mall jackpot Shoppertainment: That's the word in Las Vegas where the gaming crowd is scurrying to build entertainment-oriented malls anchored with casinos.

July 19, 1998|By Lorraine Mirabella | Lorraine Mirabella,SUN STAFF

LAS VEGAS -- From a concrete slab high above Las Vegas Boulevard, Robert Goldstein peers down at hotels and palm trees, scans the steel beams shaping his casino resort and smiles the smile of a gambler sure of his odds.

His company's $2 billion Venetian hotel and casino will open next spring on the site of the old Sands Hotel, where Frank Sinatra and the Rat Pack once came to play. In Sinatra's heyday, as for most of its history, Vegas, home of 24-hour blackjack, feather-clad showgirls and all-you-can-eat buffets, has never been known as a shopping mecca -- especially not shopping like this.

Picture visitors to the Venetian gliding through a 1,200-foot-long canal in gondolas and drifting in and out of trendy shops and cafes centered on a replicated Venetian landmark, St. Mark's Square, with soaring, skylike ceilings.

Goldstein, senior vice president of Las Vegas Sands Inc., says the retail success of the Grand Canal Shoppes, an

800,000-square-foot enclosed mall planned as the resort's centerpiece, depends on blending a little bit of Hollywood with a lot of in-your-face Vegas flamboyance. After all, this is a town that gave us a hotel built like the skyline of Manhattan.

"It goes beyond shopping," Goldstein said while leading a potential retail tenant through rubble that will be transformed into Venice in the desert. "It is the fun of being there, of seeing people in gondolas. Las Vegas is about fantasy, escapism, fun."

Casino operators, realizing the powerful draw of upscale, themed retail, are rushing to build entertainment-oriented malls and anchor them not with Saks or Macy's, but with casinos. It's the Vegas version of "shoppertainment," the potent mix of themed shopping, dining and entertainment that is transforming decaying downtowns and outdated malls across the country.

Besides the Venetian, other multibillion-dollar projects include plans for Desert Passage, a turn-of-the-century, North African-themed shopping extravaganza with the sights and sounds of a Sultan's Palace, an opulent Lost City and a village market; the Bellagio, a soon-to-open luxury hotel featuring exclusive shops lining a lakefront; Neonopolis, a megaplex-anchored, open-air plaza at Las Vegas' renovated downtown pedestrian mall; and the Fremont Street Experience, which offers casinos and hotels but little shopping or dining.

Developers view such centers as magnets for the hotels and gaming that dominate this city's economy.

"There's a synergistic relationship," said Michael Beyard, vice president for strategic development for the Urban Land Institute.

"The more attractions you have within a hotel, the larger number of people you'll have coming in, the longer they'll stay and the more money they'll spend.

"The casinos see that family entertainment and activities, in particular retailing, have a huge impact on the bottom line. These are extremely lucrative new sources of revenue in addition to gaming. It's a huge, huge market."

The surge of retail development dovetails with this city's efforts to cast itself as an entertainment destination as opposed to a place just for gamblers -- especially as other destinations have elbowed in on Las Vegas' once-exclusive gaming territory.

"One reason why the big gaming companies and hotel casinos wanted retailing and entertainment was the fact that other markets were opening to gaming," Beyard said. "Las Vegas had to be something even more."

At the same time, the spending habits of Las Vegas' 30 million annual visitors have been shifting, with nongaming spending on hotels, shopping and dining generating an increasing percentage of revenue for casino hotels.

Last year, gaming establishments reported that nongambling revenue accounted for 44.4 percent of their $10.6 billion total, 6 percent more than in 1990.

"What's happening is, shopping is becoming an entertainment experience," said Myram Borders, a communications director with the Las Vegas Convention and Visitors Authority. "People are coming here to gamble, but you can't gamble 24 hours a day.

"Visitors have discretionary money, and they like to shop. Shopping and dining go hand in hand, and that has mushroomed in Las Vegas."

The Forum Shops at Caesars Palace, developed by Simon DeBartolo Group Inc. and Gordon Group Holdings Inc. on 12 acres along the Strip next to the Mirage hotel, pioneered the casino-anchored mall six years ago amid skepticism about whether high-end retail could work here.

It did. Sales, on an annualized basis, have shot to the unheard-of average of $1,120 a square foot, the highest of any U.S. mall.

The center, which leases space from Caesars Palace, doubled in size last year to 105 shops and restaurants and plans another phase, a multilevel specialty retail, restaurant and entertainment complex shoppers would enter through a 150-foot-high re-creation of the Pantheon.

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