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Robert H. Baldwin, MGM Resorts International

images-1He is a world-class poker player – the youngest champion of the World Series of Poker Main Event when he won it in 1978 – helicopter pilot and off-road racer. Today he overseas both design and construction for hospitality behemoth MGM Resorts International and day-to-day operations for its Las Vegas mega-development CityCenter. Suites from the company’s various Las Vegas properties such as Aria, Bellagio, THEhotel at Mandalay Bay, SKYLOFTS at MGM Grand and Mandarin Oriental are regulars on Elite Traveler’s 101 Top Suites of the World list. Between his busy schedule and the upcoming World Series of Poker, Bobby Baldwin met with Elite Traveler Editor-in-Chief Douglas Gollan to talk about his company’s current winning streak.

 

Elite Traveler:  Can you give us a state of the city?

 

Bobby Baldwin:  Las Vegas in general is recovering from the lows of 2008 and 2009.  It has been a slow steady recovery.  We have so many rooms and so many visitors we like the fact that it’s a steady recovery than spiking up and down because it’s easier to manage.  I don’t think anybody is complaining.  Most of the companies that operate in Las Vegas are showing earnings that are up, in some cases dramatically.   The airport is state of the art and we are seeing more flights. The ramps at McCarran and Henderson are filled with private jets of all sizes and shapes. Not only do we have higher visitation but the spend is higher.

 

ET:  How is CityCenter doing?

 

BB:  City Center is an amalgamation of several things.  There is a residential component on the verge of selling out with Mandarin Oriental Residences and Veer.  It has a large retail component that is Crystals, it has an all-suite non-gaming tower Vdara and it has the non-gaming hotel, the Mandarin Oriental. Finally Aria is the largest component, and all those businesses are up over last year and last year was up over the year before.

 

ET:  Tell us about the real estate angle?

 

BB:  This is our fourth operating year and we are just about out of the real estate business.  We have about 100 units at the Mandarin Oriental.  Veer is already sold:  We sold about a third of the units ourselves and we sold about two-thirds to a third party who is now selling those.  We have nine penthouses we still own.

 

ET:  Looking back, what were the biggest surprises with CityCenter?

 

BB:  The biggest surprise at CityCenter was the rising cost during construction.  There were five major projects going in Las Vegas at the time (that pushed up costs).  The second part was the collapse of the U.S. housing market caught us by surprise.

 

ET:  Are there any things you had to change that weren’t working since the opening? 

 

BB:  Signage, both inside and outside.  People walked up and down Las Vegas Boulevard and they didn’t realize Aria sat back from the street so we built the largest sign in Las Vegas. It’s 260 feet tall by 60 feet wide and cost $18.5 million. We wanted to make sure that all the Las Vegas visitors knew we wanted them to come up our driveway.  On the I-15 side we also put up a larger sign.  Interior signage wasn’t up to par so we’ve replaced it.  It was as descriptive as it needed to be, and it wasn’t as welcoming.  Lots of these things happen in large developments because you’re looking at drawings, and all of a sudden all the stuff starts to arrive in the last few months and you can see that it’s wrong but you can’t respond to it right away.  It was an easy fix but it took a few months to fix it.

 

ET:  It used to be the big suites in Vegas were saved for the high rollers.  Are you interested in cash customers?

 

BB:  Very much!  The suites here at Aria are about two-thirds to cash customers and about third to so-called casino high rollers, and that’s a trend that’s continuing.  Aria has 461 suites, 291 are Sky Suites with 16 Sky Villas.  Ninety percent of the suites mid-week belong to cash customers and about half on the weekends. 

 

ET:  If a high roller comes in, does a cash customer have to worry about getting booted out?

 

BB:  If you have a confirmed reservation it’s guaranteed.  We don’t typically sell out completely for that reason. Mid-week we have quite a few convention people and we have quite a few independent travelers as well.  The suites in Las Vegas are a bargain compared to what you pay in other cities.  For six or seven hundred dollars a night you get what costs you $5,000 in another city, not only Aria but also (sister property) Bellagio.

 

ET:  Can you really deliver true luxury service in a 4,000-room hotel?

 

BB:  Yes, we learned how to make 4,000 room hotels five stars.  In some cases it’s the suite towers that are five stars and the remaining is four stars.  Aria Sky Suites are both AAA Five Diamond and Forbes Five Star award winners.  To get these ratings is quite an effort by hundreds and thousands of employees.  To get rated they come in secretly, and there are maybe 200 things and they are yes or no. You pass or you don’t.  As an actual example, if you order room service and we say it will arrive in 25 minutes, if it comes in 17 minutes, you get a ‘no’ that it didn’t work.  They only give you five-minute window one way or the other. 

 

ET:  What are the source markets for CityCenter by country?

 

BB:  The United States is 81 percent, Canada 5 percent, China 2 percent, Mexico, Brazil and Hong Kong are 1 percent.  The city overall is 16 percent international and the goal is to grow to 30 percent for Las Vegas and growing international is a priority for CityCenter as well.

 

ET:  It was recently reported that MGM is spending over $300 million in capital improvements.  What is it going to?

 

BB:  This year we are putting $297 million into the properties.  In 2010, 11 and 12 we spent around $300 million so this is what we spend year in, year out.  There is a major continuous remodeling program going on at all our hotels, in Las Vegas but also Detroit and Mississippi. Like Las Vegas we are constantly re-inventing ourselves.  We have a new Mexican restaurant, and we are about to open a pizza restaurant.  We relit the driveway and we’ve added three Starbucks.  We are constantly rearranging tenants in Crystals to ensure we have the right mix.  Nothing here is static.  There’s no glide in the casino business so every time you come back here there’s something different.