Timing and times are tough, but Wynn feeling confident - Business

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Dec. 21, 2008
Copyright © Las Vegas Review-Journal

Timing and times are tough, but Wynn feeling confident

Developer says Encore opening offers his team chance to show abilities

By HOWARD STUTZ
LAS VEGAS REVIEW-JOURNAL

Slideshow

Steve Wynn
Wynn Resorts Ltd. chairman says economy "absolutely concerns" him

Encore will open Monday in the middle of the worst economic crisis to ever impact the gaming industry. Through October, Las Vegas casino revenues are down 8.7 percent while visitation is off 3 percent.

So, is Wynn Resorts Ltd. Chairman and Chief Executive Officer Steve Wynn worried as he is about to unveil his newest $2.3 billion hotel-casino?

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"Are you nuts? If I didn't say yes, you would walk out of here thinking I was crazy," Wynn said about two weeks before the resort's opening.

"The economy absolutely concerns me. I've never experienced anything like this," said Wynn, who has been operating casinos since the 1980s. "Because we're financially secure, we look upon this as a management challenge."

Encore has been under construction for more than two years. Timing placed the opening in the midst of the national and global financial meltdown.

"There was no way around it," said Andrew Pascal, the president and chief operating officer of both Wynn Las Vegas and Encore. "We realize the world has changed, but if we deliver upon the promise to our guests, then we are meeting our goals."

Encore will open with 5,000 workers, down from the planned 5,400 employees the company had originally sought. Pascal said more than 100,000 potential employees filled out job applications, double Wynn Resorts' expectations. Some of the job classifications were changed from full time to extra part time. About half of Encore's work force is coming from Wynn Las Vegas.

"About 85 percent of the guest experience comes from the staff," Wynn said. "So the employees matter."

Encore's dealers will operate under the tip-pooling program than was implemented at Wynn Las Vegas about a year after it opened.

Wall Street is watching Encore with great interest.

Deutsche Bank gaming analyst Bill Lerner said Encore will create a buzz, but the sour economy doesn't present an ideal opening environment.

"I can't imagine Encore will grow the market dramatically," Lerner said. "I suspect it will take business from its peers, including Wynn Las Vegas. Obviously, it was unrealistic for Encore to wait or delay its opening."

Macquarie Capital gaming analyst Joel Simkins said Encore isn't creating a lot of commotion yet among the average gambling consumer, which could hurt profits.

"It's a nice new building, but we're in a difficult environment," Simkins said. "Palazzo hasn't been absorbed and we have CityCenter and Fontainebleau opening next year."

Wynn doesn't consider the challenge daunting for his management team. It's a chance to show Wall Street the group's abilities.

"Our managers and our whole organization are going to prove how smart we are," he said. "Can we deal with a down market successfully? We're pros and we're supposed to be able to do that. Any jackass can deal with the boom time."

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.

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Please enter your name Name: Please enter your email Email: Please enter a comment COMMENTS : (word count limit is 300) You have reached the maximum number of words allowed Current Word Count: Note: Comments made by reporters and editors of the Las Vegas Review-Journal are presented with a yellow background. Zuuumie wrote on December 24, 2008 08:03 PM: As expected; The same genuine service, warm and inviting energy. The aesthetics; Encore is "Le Reve" realized. A balanced blend of subliminal, peripheral, and apparent interior to delight, excite, appeal, warma and wraps the senses senses with touches of the world, that takes you a world away from the outside world, brought to life within "The Encore." BeeeJay wrote on December 22, 2008 09:04 AM: I did get a really cool invite in the mail, although it wasn't a "special offer" of any kind. I did notice my host steering my next stay towards Encore. casinocon wrote on December 21, 2008 09:16 PM: And another thing, Steve -- your websites are really messed up. My computer locks up and they will not load . . . funny, I have high speed internet and never have that problem with any other websites. Yeah, Steve . . . you're a real genius! So you see, none of us average gamblers can get any information about your resorts . . . is that how you want it? Are you that much of an idiot and a pompous rear end that you only want your treasured "high rollers" that must be numbering in the low triple digits these days, to frequent your hoity toity casinos? tw wrote on December 21, 2008 02:03 PM: It's just an annex to the Wynn..no big deal. casinocon wrote on December 21, 2008 11:43 AM: An invitation to visit the property sent to all your rewards card members would be nice! Mr. Wynn, if you had any class, or smarts at all you would be marketing to the locals that frequent your resort. I expected an invite, and maybe some free play, some little comp to entice me, but received nothing. Nada, not even a "hey, I'm opening Encore, why don't you come down and check it out!" I've gone to the player's card booth to be sure that you have my current address, your crack employees had entered my email (it is the same as my name!) in the system incorrectly, that was corrected and still nothing!!! If someone is willing to give you their email account, you should at least slip a simple invite into their inbox. Jeez Steve, you are even dumber than you look. Well, someone hit the nail right on the head when they wrote "Macquarie Capital gaming analyst Joel Simkins said Encore isn't creating a lot of commotion yet among the average gambling consumer, which could hurt profits." How the hell am I "the average gambling consumer" supposed to even know what is going on with Encore? When does it open, Steve . . . what can I find there . . . why should I gamble there??? You have my address, you have my email, I am one of the few that is STILL gambling, I'm right here!!! manny wrote on December 21, 2008 10:06 AM: Las Vegas won't be where it is today if not for Steve Wynn. He put Las Vegas in the world class destination level. Encore! Encore! to Mr. Steve Wynn.