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The Nation

Where a Casino Makes a Neighborhood

With few public spaces, Vegas locals head to new gambling centers for movies and graduations.

July 17, 2006|Don Woutat | Times Staff Writer

LAS VEGAS — In traditional caps and gowns, the nearly 400 graduates of Foothill High -- a quintessential suburban school -- crossed the stage recently to receive their diplomas in front of proud parents and cheering friends.

It was a time-honored ceremony repeated across America. But what set this one apart was the venue: the three-tower, 21-story Orleans Hotel & Casino that looms over Tropicana Avenue -- two miles west of the fabled Strip -- across the street from the Seamless Adult Ultra Lounge and the Deja Vu Adult Emporium.

The Orleans is one of a new breed of neighborhood casinos that have become de facto civic and family-entertainment centers, complete with day care, bowling alleys, movie theaters and convention space.

As its population nears 2 million, Las Vegas is becoming more mainstream and shedding its mob-stained history. Schools are opening at a rapid pace, and the city scrambles to hire teachers. Retirees have flocked here, and respected medical centers have opened.

But the locals also love to gamble, spending an estimated $1,500 per person annually. And as the population has exploded, a dozen of these neighborhood casinos -- sprawling affairs of up to 80 acres with huge hotels and parking garages that tend to dominate their neighborhoods -- have gone up since 1994. They nearly ring the city, and at least five more are in the works.

The latest and splashiest, the Red Rock Casino, Resort & Spa at the western edge of town, opened in April at a cost of nearly $1 billion. It's already expanding.

Though Vegas has had neighborhood casinos for decades, the latest versions not only play an expanded role in the city but are far bigger, more elaborate and more profitable than their sometimes seedy predecessors. For the first time, they're even attracting a fair number of tourists turned off by the glitter and crowds on the Strip.

As corporate strategy, it has paid off handsomely for Station Casinos Inc., the leader in this expanding market. Earnings have more than doubled since 2002, to $309 million last year, as revenue jumped by 40% to $1.1 billion, both records. The company claimed the highest return on investment and fattest profit margin -- 43% -- in the highly profitable gaming industry last year.

Although the nongambling amenities might get people in the door, the company says 87% of its cash flow comes from slot machines. And 80% to 85% of its customers are locals.

One of those locals is Dante Olgado, a corporate finance executive lunching for free the other day at the Green Valley Ranch in suburban Henderson, Nev. The lunch was a "comp" for his time at the poker tables playing Texas Hold 'Em.

"Ninety-nine percent of the people who live here say they don't gamble," but that's nonsense, Olgado said.

Customers say they get friendlier service and better odds -- especially in video poker, a game of some skill that is by far the most popular among locals -- at these neighborhood outposts than on the Strip. Locals can get by without celebrity chefs and tourist-choked traffic.

"The parking is better, the bargains are better, and the odds are better at the neighborhood casinos," said Anthony Curtis, publisher of the Las Vegas Advisor, a newsletter of insider advice on deals. "They're dealing with a more sophisticated and discerning customer. The Strip doesn't have to do that because the tourists are there for the sizzle."

The advantages of the increasingly resort-like neighborhood casinos are also proving attractive to more tourists, business travelers and out-of-towners visiting friends or family, said Curtis. The neighborhood casinos rely on them, as well as locals having a fling, to fill up their hotels.

Today's elaborate neighborhood edifices are creatures of Las Vegas' rapid growth and of a gradual blurring of the boundaries between public and private spaces, said Hal Rothman, a history professor at University of Nevada, Las Vegas, and author of "Neon Metropolis."

Las Vegas grew too fast to establish many public or semipublic facilities, Rothman said, and the casinos have stepped in as a way to lure more people.

"The result is that the neighborhood casino has taken on a civic dimension," Rothman said.

Thus the 9,000-seat arena at the Orleans, connected to the casino by a walkway, is a logical site for high school commencements. Foothill High's ceremonies made news when school officials, believing the devout Christian valedictorian was proselytizing in her speech, switched off the microphone. But Foothill High, in suburban Henderson, was just one of 21 public high schools to hold graduations at the Orleans this year.

"Our schools are too small for commencement, so we have to find outside venues," explained Pat Nelson, spokeswoman for Clark County School District. "If anybody objected, I'm not aware of it," she said, adding: "It wasn't actually inside the casino."

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