Why the Barbary Coast site is so key to the future of Boyd Gaming

By Jeff Simpson

Sunday, Oct. 16, 2005 | 9:36 a.m.

Boyd Chairman Bill Boyd said Thursday that the Barbary Coast would make a spectacular location for a high-rise resort.

Many have speculated that industry kingpin Harrah's Entertainment would do whatever it takes to acquire the property, which lies smack-dab in the middle of its collection of casinos near the Strip's intersection with Flamingo Road.

Harrah's already owns Bally's/Paris Las Vegas, the Flamingo, Caesars Palace and Bourbon Street and has agreed to buy the Imperial Palace.

Boyd said his company would "never close out the possibility" of a trade or sale of the Barbary Coast, but that the property is "very valuable to us. It's the most trafficked area on the Strip. We think the possibility of a high-rise development (makes for) a tremendous potential for redevelopment."

Boyd's big deal to buy locals giant Coast Casinos and its development of the Borgata megaresort in Atlantic City boosted the company to the casino industry's top flight.

And his company expects to keep growing, Boyd said.

And don't think Boyd's plans for the Stardust will involve a mid-market property. He said the company's research indicates that the high-end is where the biggest profit potential awaits.

Speaking of high-end, Steve Wynn says the most surprising aspect of Wynn Las Vegas since the $2.7 billion resort opened in April has been the response to his restaurants.

"I don't think we've ever had as many restaurants with check averages as high as ours," Wynn said. "It's been amazing how sensitive and responsive people have been to fine dining."

Wynn Las Vegas guests have been willing to open up their wallets outside the eateries as well.

"Shopping has really been robust," he said.

George Maloof told me two years ago he'd never build another Palms. But now that his hip Flamingo Road hotel is about to celebrate its fourth anniversary, he's reconsidered.

Although he's focusing on the soon-to-open expansion of the Palms, he says the power of the brand he created is undeniable.

"There's been so much consolidation in the business, and we're really the last independent brand," Maloof said. "I think with the right opportunity we can use the Palms brand somewhere else."

A California tribal casino may be the perfect spot.

Cannery casino co-owner Bill Paulos said that he and partner Bill Wortman are not quite ready to announce a new location for another locals casino.

But when the company, boosted by the resources of new partner Oaktree Capital Management, does build again, it will use the Cannery brand.

"We love the Cannery brand," said Paulos. "We believe in the brand and the concept." Unlike other locals operators who are building ever-more-expensive locals casinos -- including the $600 million South Coast that Boyd's Coast Casinos is opening by the end of the year and the $925 million Red Rock Resort that Station Casinos expects to open next spring -- Paulos said the lower-budget Cannery model that's succeeding in North Las Vegas will work well elsewhere.

One trend a number of casino executives are trying to capitalize on is the condominium craze. One savvy marketing expert said the first nice projects to be built will get "the cream at the top of the bottle" -- the best customers with the most money.

Riviera Holdings Chairman Bill Westerman said his company's redevelopment plans would focus on both casinos with all the resort amenities and condominiums. Sky-high Strip land prices dictate the decision, he said, noting that the company has not yet decided whether to sell its 26 acres or build anew.

"If we do redevelop it will be mixed use," Westerman said. "You've got to have a lot more than a casino and a lot more than condos. It's got to be both."