The recent wave of mega-mergers could result in the spinning off of selected hotels, which could become interesting to operators such as the owner of Fitzgerald’s in downtown Las Vegas.
Fitzgerald’s owner Don Barden "would love (to own) a larger property" and could move to acquire another property at any time, according to Mike Darley, the man who runs the downtown hotel on a day-to-day basis while Barden attends to his business interests, including another casino in Indiana.
Darley said his boss would like to have a larger property for entertainment purposes and that some of the properties mentioned in the recently announced proposed mergers piqued his interest.
"Companies (like) ourselves are looking for spin-offs" that might come out of the proposed mega-mergers, said Darley, the vice president and general manager of Fitzgerald’s.
Spin-offs are secondary properties that the principals in the mergers might be willing to sell in order to facilitate the proposed merger or satisfy federal regulators.
Darley, 53, has been in Las Vegas for two years. He has worked in the hotel-casino industry in Lake Tahoe, Mississippi and Indiana, and spent 20 years working for Harrah’s. He also spent time working for Donald Trump.
Assessing the mergers, Darley said, "I don’t (think) it’s necessarily going to hurt (the industry) if they approach business tactics right. The dynamics will be interesting between Caesars and Harrah’s."
Darley said the "Fitz" is "doing fine," adding that the hotel’s occupancy rate was running in the mid-80s during the slower summer months. He said Barden has invested $4 million in the property since he purchased it two years ago.
The investment has resulted in the construction of a pool and spa, and new carpeting throughout the hotel. He said Fitzgerald’s has also remodeled its showroom, convention area and restaurants. Pumping money into the hotel has not only made the hotel more attractive to guests, it’s helped employee morale as well, he said.
Darley said demographics have played a major part of the Fitzgerald’s marketing strategy. The casino has succeeded in attracting younger gamblers without alienating the more elderly customers who have been gambling at the Fitz for years, he said.
"I’m high on downtown," he said. "I think downtown fits a lot of people (with its) history and walkability."
Darley said "gamblers want a different (gambling) experience," which they find downtown with the Fitz and neighbors such as the Four Queens and Golden Nugget. He said gamblers can’t go from casino to casino that easily on the Strip.
He added that the "$5,000 player feels like they are somebody" when playing downtown, while on the Strip the casinos wouldn’t allow him high-roller treatment.
Darley defended the Fremont Street Experience as a legitimate attraction and said that "some of the indigestion stems from city involvement" in the project. He said critics of the Fremont Street Experience "need to come down here and look at the people looking up" at the light show. He compared the canopy over Fremont Street with the fountains at Bellagio and the volcano at The Mirage.
He also defended the removal of some of the Fremont Street vendors. "They were clogging our arteries," he said, adding that "our product is gambling" and the vendors who operate kiosks were distracting tourists and their money away from the casinos.
He said the new owners of the downtown casinos "brought new energy and enthusiasm (and a) new spirit of cooperation between the casinos. We all want to be successful (but if we don’t ) work together and with cooperation, it’s not going to happen."
He said the worst thing that could happen to Fremont Street would be for "people to give up on it." He said the people who have done that simply "haven’t been downtown."