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Jim Murren: ‘Near-death experience’ nearly pushed MGM Mirage to bankruptcy

Las Vegas Preview

Tiffany Brown

MGM Mirage CEO Jim Murren speaks at Preview Las Vegas at the Cox Pavilion in Las Vegas on Thursday, Jan. 28.

Updated Thursday, Jan. 28, 2010 | 4:55 p.m.

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MGM Mirage Chief Executive Jim Murren speaks at Preview Las Vegas at the Cox Pavilion in Las Vegas on Thursday, Jan. 28, 2010.  Launch slideshow »

Beyond the Sun

MGM Mirage, the state’s largest employer and taxpayer, is rejoining the Las Vegas Chamber of Commerce after a six-year hiatus.

Jim Murren, chairman and CEO of the company, told an audience at Preview 2010 on Thursday that the decision to rejoin the chamber came after MGM Mirage’s “near-death experience” during the construction of its CityCenter.

Murren said the company came within minutes of filing for bankruptcy protection and shutting down the massive Strip resort that opened last month when partner Dubai World filed suit against the company and said it wouldn’t make a debt payment in early 2009.

Since then, Dubai World and MGM Mirage have reconciled, but the experience gave Murren a new realization that it would require teamwork to solve the state’s many problems.

“That corporate near-death experience was my wake-up call that rhetoric is no longer enough,” Murren told the more than 2,000 persons attending the Las Vegas chamber’s premiere networking event at the Cox Pavilion and the Thomas & Mack Center.

Murren said he hopes MGM Mirage’s presence would build a team effort to confront four key problems facing the state – education, sustainability, health care and infrastructure. Murren said his company already has confronted a number of those issues in their efforts to keep the company afloat and he said he would dedicate company resources to help the chamber address them.

Murren was one of three local speakers for Preview. Earlier, Las Vegas Convention and Visitors Authority President and CEO Rossi Ralenkotter told the crowd that the LVCVA is projecting visitor volume in Las Vegas will climb 3 percent to 37.4 million people in 2010.

MGM Mirage left the chamber in 2003 after the gaming industry proposed a broad-based business tax that the chamber wouldn’t support.

“It caused great division among gaming and the chamber and at the end of the day, we didn’t get that business tax,” Murren said in an interview after his presentation. “As of today, we still don't have a tax structure that works.”

Murren said that after construction on CityCenter nearly shut down, he had a new appreciation for the value of business relationships to help solve problems. He thinks working with the chamber would be valuable in addressing state problems and he said the company would dedicate personnel as well as money to the effort.

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Attendees listen during Preview Las Vegas at the Cox Pavilion in Las Vegas on Thursday, Jan. 28.

“We’re assembling a team within our company,” Murren said. “We have a lot of folks that are obviously quite versed in business issues throughout our organization. They’re going to devote thousands of man-hours to this, working with the chamber and its various committees. We’re going to work together to form a plan, we’re going to be up in Carson City together and it’s going to be a very spirited couple years out here and we’re looking forward, at every level, to working with the chamber.

“I‘ve made it quite clear that alone, we will fail – as a company and as an industry. Together, we have a pretty darn good chance at succeeding, but it’s not going to be easy.”

Chamber President and CEO Kara Kelley said she wasn’t surprised by the company’s decision to rejoin the chamber because Murren has worked on a number of issues as a nonmember.

“What we saw today at Preview was a sincere commitment to improving the lives of Nevadans and improving our economy,” Kelley said. “Jim and his family live here. He is invested here, both economically in his business and as a Nevadan.”

Kelley said he doesn’t expect MGM Mirage or the gaming industry to be in full agreement on every issue. She also feels having MGM Mirage back in the fold will build appreciation for the company.

“There’s almost a universal lack of appreciation among the citizenry on the relationship between the health of the gaming industry and everybody’s else’s well-being,” Kelley said. “It is symbiotic in how we all prosper.”

In his presentation, Ralenkotter described a multifaceted strategy for rebuilding the city’s decimated tourism economy, adding that the strength of the Las Vegas brand would pull the city through its economic woes. He said the LVCVA is working to market the city as a tourism destination through advertising, special events and lobbying government leaders on public policy.

The consumer confidence index, the unemployment rate and monitoring the public’s intent to travel are key indicators the LVCVA watches to measure progress, he said.

Addressing the Preview audience in a talk-show format, Ralenkotter said, “The first thing I want to say (about 2010) is that 2009 is over. It’s been the most difficult economic challenge any of us have ever had. We’re going to win in ’10.”

The LVCVA’s part, he said, would be to continue to advertise the city with clever television campaigns. He said the LVCVA’s “excuses campaign,” in which ad characters come up with reasons to visit Las Vegas like celebrating “Chinchilla Day,” would continue. Other themes will be showing Las Vegas as a value proposition. The LVCVA also will reintroduce its popular “What happens here, stays here” campaign with new ads.

Three new television spots were shown to the Preview audience.

Ralenkotter said the special events calendar has grown with a new event – the Las Vegas Sevens international rugby tournament – joining Chinese New Year, the Sports Illustrated swimsuit edition release and the NASCAR race in February alone.

Other events on the calendar are the Professional Bull Riders Association world championships, the Miss USA pageant and Vegas Uncork’d, a rapidly expanding food festival.

Ralenkotter said LVCVA officials have been busy talking with Washington lawmakers to explain the importance of the meetings and convention industry to Las Vegas.

“The conventions and meetings industry have been under attack, especially incentive travel,” Ralenkotter said. “We had to fight for our position and change the tone on Capitol Hill.”

Ralenkotter said the tourism industry has done that by explaining how many jobs exist as a result of tourism.

“We’ve had to re-educate our senators and congressmen,” he said.

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Jeremy Aguero of Applied Analysis presents at Preview Las Vegas at the Cox Pavilion in Las Vegas on Thursday, Jan. 28.

Choosing a health-care theme, Jeremy Aguero, principal analyst for Las Vegas-based Applied Analysis, gave a list of 10 ways to get the Southern Nevada economy off life support.

Heading his list: Getting the region focused on diversifying the economy. He also recommended exploiting the area’s tourism infrastructure to grow business, accept the reality of what the recession has done to values and reset pricing accordingly and getting to work on the $5.2 billion in shovel-ready projects to put people back to work.

Aguero also said Southern Nevada must invest in education and renewable energy, focus on the area’s growing health-care economy started by the Nevada Cancer Institute, the Lou Ruvo Brain Institute and the Cleveland Clinic and attract and retain senior citizens to the area.

Today’s program also included a presentation by New York Times bestselling author Steven Levitt, who co-wrote “Freakonomics” and “Superfreakonomics.”

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