HIGHLY CONFIDENTIAL: TO BE SEEN BY TEAM MEMBERS ONLY PARIS LAS VEGAS www.parislasvegas.com PARIS LAS VEGAS JEFF BABINSKI General Manager Boomtown Casino- Reno Verdi, Nevada JOSEPH DUPUIS Video Systems Gaming Manager Lucky Eagle Casino Rochester, Washington CHRISTOPHER WOOD It Services Manager Great Blue Heron Charity Casino Port Perry, Ontario Canada EDMOND KWOK HUNG YU Financial Controller - City Club Galaxy Entertainment Group Macau, China CAROLINE COLEMAN Duty Manager Holland Casino Hoofdsorp Hoofdorp, The Netherlands MARK MADAMBA Director, Af Gaming - Pacific Usaf Services Agency Japan SERGE IP VAI CHING Casino Management Trainee Torarica Hotel and Casino Paramaribo, Suriname email@example.com firstname.lastname@example.org email@example.com firstname.lastname@example.org email@example.com firstname.lastname@example.org email@example.com SPECIFIC DIRECTIVES AND CHALLENGES FOR PARIS LAS VEGAS FOR PHASE 1 NOTE: THE FOLLOWING INSTRUCTIONS WILL REQUIRE YOU TO HYPOTHESIZE HOW YOUR CASINO PROPERTY HAS CHANGED WITH THE DETERIORATING CIRCUMSTANCES CONFRONTING THE NATIONAL ECONOMY, LAS VEGAS, AND THE PARENT COMPANY FOR YOUR CASINO. ACCURACY IS NOT AS IMPORTANT AS COMING TO QUICK AGREEMENT AMONG TEAM MEMBERS AS TO “WHAT IT WAS LIKE” BEFORE THE CHANGES IN THE ECONOMY, DESCRIBING “WHAT HAS CHANGED FROM THEN TO NOW,” AND THEN SUGGESTING GUIDELINES FOR THE PARTICULAR AREA FOR THE NEXT NINE MONTHS UNDER THE NEW TEAM. FEEL FREE TO USE YOUR IMAGINATIONS AND COLLECTIVE EXPERIENCE THROUGHOUT. In September 1999, Paris Las Vegas opened as one of five mega-casinos built on the Las Vegas Strip at the end of the millennium. Heavily themed around the City of Paris, the property was built by Park Place Entertainment adjacent to their Bally’s Hotel and Casino. At a budget of $800 million, Paris was the “least expensive” of the five casinos that represented the third major wave of casino-hotel entertainment centers that had hit the Strip since 1989. Paris Las Vegas was a strong performer from the outset, well located in the Center of the Strip across from the fountains of Bellagio. In 2000, Park Place Entertainment culminated its acquisition of Caesars Entertainment and in 2001, the corporate name was changed to Caesars Entertainment. In 2005, Harrah’s Entertainment completed the $9.3 billion acquisition of Caesars Entertainment, which gave them numerous casinos on the Las Vegas Strip, including Paris. Paris Las Vegas continued to be a strong performer in the second half of the decade. However, problems arose for all the Harrah’s operations following the Leveraged Buy-Out that Harrah’s culminated in January 2008. That deal was begun in fall 2006 when two venture capital companies, Apollo and Texas Pacific, offered $15 billion, or $80 per share, to take Harrah’s private. The final negotiated price was around $90 per share, or $17 billion. By the time the LBO closed in January 2008, the economic conditions of the country had changed dramatically, and the performance of Las Vegas casinos in particular had already begun to erode. With a total debt exceeding $24 billion, Harrah’s corporate management began an aggressive cost cutting survival strategy. By mid-2008, virtually every major capital and development project that Harrah’s had been pursuing was either cancelled or put on hold. As of early fall 2008, all capital budgets for all of Harrah’s operating casinos were put on hold; that did not end until June 2010. Thus, the challenge for Paris was the disruption of an otherwise smooth-running operation. Typically slot machines are on a five year replacement cycle. Paris has had to put that program on hold since August 2008. The same is true with refurbished rooms, which Paris had been remodeling on an eight year cycle. Other areas of deferred maintenance have also come into play. In general, corporate management directed operations to cut costs as dramatically as possible, while preserving service levels as close to the traditional standard as possible. It is in this context that the new Management Team was brought on board. The previous Paris management team was recruited en masse to run a new casino in Kansas, so the new Team has been brought in to develop its own approach. Harrah’s new operating style provides considerable autonomy to management teams, and their evaluation is all based on performance measures. The company’s objective is to increase cash flows so that the company will be in a position to service their financial obligations as their long term debt begins to come to maturity in 2012 an onward. As a Team, your PHASE 1 tasks are: 1. Identify at least ten key metrics (related to performance of casino games, different departments, customer behavior, perceived customer service levels, cost containment, employee morale, etc.) that will allow you to monitor the performance of this operation over time. These should be linked to overall objectives for managing the property, and should be among the most important for you to make the best strategic decisions relative to your overall objectives into the future. (If you list more than 10, identify your top ten.) 2. As the new Management Team, list (in bullet points) what you believe might have been the basic policies toward employment that prevailed at your property from early 2008 to the present. Use your imagination, prior knowledge of the casino and/or company, and collective experience regarding your own casino or other casinos with which you are familiar to identify some basics of a Human Resources Strategy that may have prevailed over this period. Again using bullet points, note how this strategy may have been modified since early 2008. Given this as a base, and in light of the current competitive and economic conditions in Las Vegas, as well as the company’s broad directives, put forward an HR strategy that will guide your management team over the next nine months or so. This could include consideration of benchmarks, benefits, incentive programs for employees and hosts, and performance evaluation standards. (Keep in mind that you do have some unions to work with, especially the Culinary.) Prepare an internal memorandum of one page or less that will be circulated among your employees that clarifies this strategy. Note separately in one or two sentences what you hope to achieve with this memo. 3. Briefly identify what you believe has been the target market for this casino under the prior management team. Based on the description of events above, use your imagination and collective experience to briefly summarize a marketing strategy that may have been in place at the property between early 2008 and the present. (Use bullet points.) Note how this marketing strategy might have been affected by cost cutting and the broader challenges confronting the Las Vegas gaming industry. Then recommend a marketing strategy that will drive the property forward over the next nine months. In particular, identify your target market(s) and try to include clever and cost-effective ways of increasing market share and growing revenues without overly taxing operating budgets. Summarize this marketing strategy in one or two paragraphs. 4. A freeze has been in place since August 2008 for any capital outlays beyond necessary replacement of non-functioning or damaged equipment. As a result, there is deferred maintenance that has built up on a variety of assets, including carpets, walls (in need of painting), furniture and fixtures, software systems, and gaming equipment. For the next nine months, corporate has indicated you will have $15 million that can be allocated to capital outlay needs. Drawing from your imagination and collective experience, discuss a strategy that you will use in allocating this amount to various areas within the facility. 5. Write a one paragraph position strategy1 that explains how you might want the property to be perceived by the public. This statement should explain who your target audience is, your thematic premise, your service promise, your pricing standards, and a statement of your quality objectives. Try to be as specific as you are able in addressing the above issues, and keep in mind the budget constraints and performance challenges for the property at the present time and over the next nine months. A written response to the above inquiries is due no later than 10 am Saturday, November 7. The response should be no more than five (5) type-written pages (Times New Roman, 10 point, single spaced.) It must be e-mailed to the following address: firstname.lastname@example.org . Once a team has submitted its PHASE 1 report, the team members will receive their PHASE 2 instructions. Note that PHASE 1 submissions will be competitively graded and the results will be reflected in the Casino Resort’s future performance indicators. If the Team wants their PHASE 2 instructions before Saturday morning, they need to submit the PHASE 1 report no later than 9 pm Friday, November 6. 1 Generic example of a Position Strategy: Our casino will target, attract and host low premium and qualified high grind gamblers by providing very professional, yet “small town” style, guest service from highly-trained and motivated team members in a Western- themed, very exciting, extremely clean and secure casino/hotel environment that features very good quality food and entertainment products at low to moderate prices. We will be committed to make the guest feel lucky for having chosen our casino! DESCRIPTION The Paris Las Vegas transports visitors to the City of Light. Paris Las Vegas captures all the details of Paris, right down to the cobblestone sidewalks and half-scale replica of the Eiffel Tower and Arc de Triomphe. Wrought iron street lamps line the 85,000 square foot casino with the legs of the Eiffel Tower sit in the middle of 1,700 slots and 90 table games. Guests can dine at the Eiffel Tower Restaurant, but beware, it's by reservation only. Diners can watch the world pass by at Mon Ami Gabi, a fine French restaurant where the most popular tables are the ones outside facing The Strip. Dining isn't just limited to the French, Asian restaurant Ah Sin is host to many dishes from the Pacific Rim. If you've just hit the jackpot on the casino floor, try the $777 Kobe beef and Maine lobster at Le Burger Brasserie. Famous pastry chef Gaston Lenôtre opened a branch of his renowned pastry shop on the cobblestone-lined Le Boulevard, a street filled with intimate shops and restaurants, all underneath a blue cloud-filled celling. Strolling along Le Boulevard don't be surprised to see an extremely lifelike bronze statue move, that's because it's a real person The City of Light doesn't go dark after dark. Anthony Cools - The Uncensored Hypnotist checks inhibitions at the door and pushes the limits of the audiences mind and body. Sitting right above the restaurant is nightclub Risqué, Paris' ultra lounge that is as fun as it is fantastic. Attractions Eiffel Tower Don’t miss the view from the single most romantic spot in all of Vegas – 460 feet above the heart of the Strip atop the Eiffel Tower Experience. A signature of the Las Vegas skyline, the replica Eiffel Tower at Paris Las Vegas is a half-scale exact reproduction of one of Europe's most famous landmarks. You’ll take a breathless elevator ride ride to the top, where a breathtaking, panoramic view of the valley awaits. Along the way, an experienced elevator guide will point out can't-miss Vegas landmarks. Spa by Mandara inside Paris Las Vegas Mandara Spa is one of the largest and fastest growing luxury hotel and resort spa treatment and management companies in the world providing a relaxing and rejuvenating environment, with a wide variety of therapeutic and exotic skin and body spa treatments, products and packages to choose from. Amenities Sports Book Seats 265. 232 televisions. Poker Room 8 tables of Texas Hold 'Em and 7-card stud Health club Paris Spa by Mandara Spa Spa by Mandara Shopping Center Le Boulevard Wedding Chapel Wedding services Convention Facilities More than 140,000 square feet Business Center Hotel Room Internet Call for pricing. Casino Wireless Internet Wheelchair Accessible Rooms RV Park Child Care Pets Allowed Self Parking Garage Valet Parking Free. Airport Shuttle $5.50 per person Remote Baggage Check-in On Site Catering Call for details. Movie Theater Arcade Bowling Alley Non-Smoking Gaming Players Club Harrah's Total Rewards program Buffet Le Village Buffet Arena Nightclub & Bars Risqué de Paris While it’s quite a trek from self-parking through the faux-cobblestoned streets of the Paris casino to Risqué nightclub, once you reach the lavish interior of this second-story nightclub, you’ll be glad you made it. For a taste of the Vegas Latin scene, go on Friday night and wear your dancing shoes. Dining Ah Sin du Parc Eiffel Tower Restaurant JJ's Boulangerie La Creperie Le Burger Brasserie Le Cafe Ile St. Louis Le Provencal Les Artistes Steakhouse Le Village Buffet Mon Ami Gabi Gaming Machines - 2,400 total Anchor's Wheel of Gold - $.25, 16 machines - $0.25 to $0.75 bets CDS Top Dog Dollar Slots, 240 machines Five Dollar Slots, 31 machines Half Dollar Slots, 4 machines Hundred Dollar Slots, 17 machines IGT - Megabucks, 4 machines Multi-denomination Slots, 1,308 machines Nickel Slots, 85 machines Other Slots, 62 machines Penny Slots, 340 machines Quarter Slots, 290 machines Twenty Five Dollar Slots, 19 machines Table and Poker Games - 173 total 3 Card Poker, 10 tables Asia Poker Baccarat, 9 tables Blackjack, 67 tables Caribbean Stud Poker, 2 tables Craps, 10 tables Let it Ride, 4 tables Mini-Baccarat, 5 tables Other Games, 16 tables Pai Gow Poker, 11 tables Pai Gow Tiles, 1 table Poker, 18 tables Roulette, 18 tables Wheel-of-Fortune, 2 tables Other Gaming Keno - 2 seats Race Book Sports Book Review Surrounded by a rather Disney-esque one-third-scale replica of the streets of Paris, this 83,000- square-foot casino is a very pleasant place to gamble, in that Vegas-gimmick kind of way. It's one of those kitschy places that "real" gamblers are appalled by. To heck with them, we say. A tall ceiling gives the illusion that you are trying to bust the bank while strolling outside and results in an airy effect. The place doesn't feel all that large, thanks to its layout. It has more than 2,000 slot machines and more than 100 table games. A state-of-the-art race and sports book features live satellite feeds of sporting events from around the world. The Paris is part of Harrah's Total Rewards players' club. Sacre bleu! The City of Light comes to Sin City in this, one of the few theme-run-amok hotels left to its giddy devices. Stay here if you came to Vegas for the silly fantasy. The outside reproduces various Parisian landmarks (amusing anyone familiar with Paris, as the Hotel de Ville is crammed on top of the Louvre), complete with a half-scale perfect replica of the Eiffel Tower. The interior puts you in the middle of a dollhouse version of the city. You can stroll down a mini Rue de la Paix, ride an elevator to the top of the Eiffel Tower, stop at an overpriced bakery for a baguette, and have your photo taken near several very nice fountains. You'll find signage employing the kind of dubious use of the French language that makes genuine Frenchmen really cross ("le car rental" and so forth), while all the employees are forced to dust off their high school French ("Bonjour, Madame! Merci beaucoup!") when dealing with the public. Don't worry, it's not quite enough to make you sick to "le stomach." Quel dommage, this attention to detail does not extend to the rooms, which are nice enough but disappointingly uninteresting, with furniture that only hints at mock French Regency. Bathrooms are small but pretty, with deep tubs. Try to get a Strip-facing room so that you can see Bellagio's fountains across the street; note also that north-facing rooms give you nice peeping-tom views right into neighboring Bally's. The monorail has a stop out back, which adds to the convenience factor. Overall, not a bad place to stay but a great place to visit -- quel hoot! The hotel has eight more-or-less French-themed restaurants, including the highly lauded Le Village Buffet, the Eiffel Tower restaurant (located guess where), and bistro Mon Ami Gabi. The bread for all these restaurants is made fresh on-site at the bakery. You can buy delicious, if pricey, loaves of it at the bakery, and we have to admit, that's kinda fun. There are also five lounges. Paris Las Vegas From Wikipedia, the free encyclopedia Paris Las Vegas is a hotel and casino located on the Las Vegas Strip in Paradise, Nevada, USA, that is owned and operated by Harrah's Entertainment. As its name suggests, its theme is the city of Paris in France; it includes a 5/8ths scale, 541-foot-tall (164.6 m) replica of the Eiffel Tower, a sign in the shape of the Montgolfier balloon, a two-thirds size Arc de Triomphe and a replica of La Fontaine des Mers. The front of the hotel suggests the Paris Opera House and the Louvre. The Paris is linked via a promenade to its sister property, Bally's Las Vegas, through which it is linked to the Las Vegas Monorail. The project was originally announced by Bally's Entertainment, owner of the adjacent Bally's Las Vegas. It was designed by architectural companies Leidenfrost/Horowitz & Assoc., Bergman, Walls & Assoc. and MBH Architects. Ground was broken for the Paris on April 17, 1997. It opened September 1, 1999 with fireworks being shot from the Eiffel tower. French actress Catherine Deneuve flipped a switch, turning on all of the Paris' lights. Building began under Hilton Hotels, which purchased Bally Entertainment in 1996; Hilton's casinos were subsequently spun off into Park Place Entertainment, which purchased Caesars World in 2000 and changed its name to Caesars Entertainment in 2004. At the time of its opening, the hotel ran amusing television advertisements throughout the United States implying that it had ensured the authenticity of its reproductions of Paris landmarks, culture and cuisine by looting the real city. When the scale model of the Eiffel Tower was built, it was planned to be full scale, but the airport was too close and the tower had to be shrunk. The scale is approximately 5/8ths. Paris cost USD $785 million to build, and occupies 24 acres (97,000 m²). The casino itself contains a sky painted ceiling, a popular choice among Las Vegas resorts. A unique aspect of Paris Las Vegas is that the back legs of its Eiffel Tower actually come down through the ceiling into the middle of the casino floor. In November 2006, the Paris sports book was temporarily shut down pending an investigation of its employees for allegedly underreporting tips. In 2007, Paris Las Vegas premiered their new show The Producers, headlined by David Hasselhoff. Once continuing issues regarding Hasselhoff not showing up to shows were fixed (i.e., he left the show), the show refocused on Max, played by Tony Danza, who came on as the celebrity actor for the show until its end in February 2008. To counter the 2008-2009 economic downturn, Harrah's focused on marketing its properties to specific segments of the population; as a result Paris is being marketed heavily towards gay and lesbian travelers. FINANCIAL INFORMATION PARIS LAS VEGAS HOTEL AND CASINO CONDENSED STATEMENT OF OPERATIONS (Unaudited) (In thousands) Twelve Months Ended December 31, 2006 2007 2008 2009 REVENUES: Casino $ 280,272 $ 292,352 $ 260,621 $ 235,067 Rooms 181,212 195,769 181,505 147,038 Food 99,143 100,367 99,143 89,954 Beverage (includes entertainment) 35,496 39,168 36,720 34,037 Other 22,487 24,267 22,164 21,890 Total revenues 618,610 651,923 600,153 527,986 Less-promotional allowances 49,048 50,285 43,784 39,021 Net revenues $ 569,563 $ 601,638 $ 556,368 $ 488,965 COSTS AND EXPENSES: Direct costs and expenses of operating departments: Casino 161,156 167,225 149,857 135,163 Rooms 56,176 59,709 56,266 45,582 Food 85,263 88,825 85,263 77,361 Beverage (includes entertainment) 19,984 21,621 20,600 18,992 Other 13,177 15,410 12,766 12,543 General and administrative ǂ 108,257 116,042 97,225 83,422 Total costs and expenses $ 444,014 $ 468,832 $ 421,978 $ 373,063 INCOME (LOSS) FROM OPERATIONS $ 125,549 $ 132,806 $ 134,391 $ 115,902 EBITDA 179,368 186,916 192,606 166,588 Depreciation and amortization 53,819 54,110 58,215 50,687 Interest expense* 63,080 62,196 59,825 57,202 NET (LOSS) INCOME $ 8,650 $ 16,500 $ 16,351 $ 8,013 * Interest expense is related to original construction loans and improvements made on the property ǂ Excluding interest, but including Depreciation and Amortization PARIS GGR PERFORMANCE SINCE JANUARY 2009 January-09 21,052 -18.24% February-09 18,534 -14.60% March-09 21,084 -11.36% April-09 19,488 -14.13% May-09 19,189 -10.02% June-09 18,159 -12.30% July-09 19,829 -9.85% August-09 16,611 -16.76% September-09 20,606 -6.17% October-09 20,731 -3.11% November-09 19,463 -1.07% December-09 20,320 3.29% January-10 19,704 -6.41% February-10 17,669 -4.67% March-10 18,999 -9.89% April-10 17,734 -9.00% May-10 17,302 -9.84% June-10 16,875 -7.07% July-10 18,483 -6.79% August-10 15,384 -7.39% FISCAL YEAR PERFORMANCE (through June 30) Avg Daily HOTEL Room Room Food Beverage ROOMS Rate Occupancy Revenues Revenues Revenues 2006 2,916 $175.89 96.80% $181,212,402 $99,143,271 $35,495,739 2007 2,916 $189.42 97.10% $195,768,736 $100,367,262 $39,167,712 2008 2,916 $179.58 94.96% $181,504,837 $99,143,271 $36,719,730 2009 2,896 $153.75 90.47% $147,038,254 $89,954,104 $34,036,688 2010 2,896 156.75 91.53% $151,656,991 $92,113,002 $35,568,339 EMPLOYMENT (AS OF JUNE 30) Casino Room Food Beverage G&A Other TOTAL 2006 1,277 999 1,487 317 562 824 5,466 2007 1,187 908 1,299 345 574 717 5,030 2008 1,184 934 1,351 362 513 718 5,063 2009 1,102 866 1,265 340 478 647 4,697 2010 1,143 897 1,311 353 495 671 4,870 LAS VEGAS STRIP $72 million and above ECONOMIC PERFORMANCE INDICATORS, 2006-2010 EMPLOYMENT STATISTICS (as of June) Other Casino dept Rooms Dept. Food Dept. Bev. Dept. Depts. G&A TOTAL 2006 23,357 18,267 27,199 5,788 10,274 15,065 99,950 2007 22,477 17,207 24,599 6,526 10,872 13,591 95,272 2008 23,178 18,284 26,435 7,078 10,048 14,057 99,080 2009 21,602 16,968 24,796 6,667 9,365 12,679 92,077 2010 23,601 18,538 27,091 7,285 10,232 13,853 100,600 DEPARTMENTAL MARGINS Other Casino Dept. Rooms Dept. Food Dept. Bev. Dept. Depts. 2006 40.5% 67.0% 12.0% 41.7% 39.4% 2007 40.8% 69.2% 10.3% 42.7% 35.6% 2008 38.3% 67.6% 17.1% 41.1% 42.8% 2009 41.0% 66.5% 18.3% 41.5% 42.1% 2010 39.5% 67.5% 17.3% 42.1% 39.8% GROSS GAMING Las REVENUES Vegas Baccarat Strip LVS ($ 72 m+) ($72 m+) MONTH January-06 583,667 91,009 February-06 509,885 79,454 March-06 494,425 35,959 April-06 473,866 55,358 May-06 555,052 86,882 June-06 414,148 41,413 July-06 490,023 52,484 August-06 511,002 75,609 September-06 470,928 55,074 October-06 486,147 29,236 November-06 599,961 117,242 December-06 574,658 114,081 January-07 562,325 90,757 February-07 535,671 117,039 March-07 497,300 36,039 April-07 486,973 60,354 May-07 560,421 71,237 June-07 460,517 44,361 July-07 565,189 72,209 August-07 492,126 70,349 Las Baccarat Vegas LVS Strip ($72 m+) ($ 72 m+) September-07 509,096 45,640 October-07 594,608 108,107 November-07 485,326 46,961 December-07 580,892 140,354 January-08 559,728 80,983 February-08 519,870 116,335 March-08 477,018 34,766 April-08 481,158 59,184 May-08 465,935 69,445 June-08 430,187 45,224 July-08 461,287 52,311 August-08 442,886 71,837 September-08 484,923 76,618 October-08 438,300 40,500 November-08 405,552 39,780 December-08 443,922 78,129 January-09 479,937 96,169 February-09 395,360 57,490 March-09 417,854 33,496 April-09 407,932 52,681 May-09 446,033 96,224 June-09 378,734 47,704 July-09 429,707 68,228 August-09 412,333 109,515 September-09 446,129 70,489 October-09 420,435 42,525 November-09 395,772 40,973 December-09 507,349 97,661 January-10 555,811 129,828 February-10 463,288 74,737 March-10 452,798 41,535 April-10 447,807 60,583 May-10 493,263 115,469 June-10 422,303 54,860 July-10 479,225 74,369 August-10 438,300 93,088 NEWSPAPER CLIPPINGS DESCRIBING PARIS LAS VEGAS Strip gets an Eiffel Gary Thompson and David Strow Thursday, Sept. 2, 1999 Paris Las Vegas, the final Strip resort to open this millennium, was greeted Wednesday night by a packed but well-ordered mob numbering in the tens of thousands. The $800 million Park Place Entertainment resort opened its doors a few minutes after 10 p.m. to a crowd packed along both sides of Las Vegas Boulevard, from Bellagio Drive to Flamingo Road, spilling over into the closed northbound lane of Las Vegas Boulevard. For 15 minutes, a mass of humanity poured into the new property, joining a crowd of 4,000 invited guests. Those that rushed in with the public liked what they saw, but couldn't see much -- thousands packed every inch of the resort's floor space, turning foot traffic into a crawl. Every slot machine was taken, and it was difficult to find a seat even at the $100-minimum blackjack tables. Shortly before 11, the fire marshal ordered Paris to stop letting in people because the place was too crowded. "We have never seen so many people in one place," said Ruth Davis of Puyallup, Wash., who was staying at Bally's. "It almost looked like New Year's Eve in Times Square. We're coming back tomorrow morning." Those in the VIP crowd got a better view, having to share the resort with a comparatively paltry 4,000 invited guests. VIPs in attendance included casino mogul Donald Trump. "To say it's phenomenal is an understatement," said Las Vegas Mayor Oscar Goodman. "I'd rather be here than in Paris itself. It makes me proud to be mayor of a city with such a wonderful attraction." "It's gorgeous," said Congressman Frank LoBiondo, R-N.J. "It has a truly warm and intimate feeling about it. It's hard to explain how magnificent it is unless you can see it for yourself." "A magnificent and unique attraction to the skyline of Las Vegas," said gaming attorney Robert Faiss of Lionel, Sawyer & Collins. "Without exception, the people I've talked to give it rave reviews for its quality and character." "Wow!" said former Nevada Gaming Commission Chairman Bill Curran. "I just spent a week bicycle riding through the south of France, and this is just like being there," said International Game Technology Chairman Charles Mathewson. "I walked in and said, 'Fantastic!"' added Gov. Kenny Guinn. An estimated 2,000 of the resort's 3,000 rooms were filled on opening night. Starting today, and through Labor Day weekend, Paris Las Vegas will be sold out. For the past year, as the resort's exterior has gradually taken shape, its faithfully executed replicas of exquisite Parisian architectural landmarks beckoned invitingly, creating a sense of anticipation that built as opening night approached. Opening ceremonies began at 9:42 p.m. -- 11 minutes behind schedule, thanks to a stubborn breeze -- as the lights on the real Eiffel Tower were extinguished by the great-grandson of its designer just as dawn broke on Paris. With a sudden concussion, fireworks shot into the sky, lighting the Paris landmark's new sister on Las Vegas Boulevard. French actress Catherine Deneuve then threw a switch turning on the lights illuminating the Las Vegas tower. While fireworks danced about the tower, the Bellagio's trademark fountain show was starting next door -- but, for perhaps the first time in its history, few people were paying any attention. Like Bellagio, Mandalay Bay and the Venetian, the other new mega-resorts that have opened on the Strip in the past 11 months, Paris Las Vegas exemplifies a spiritually enriching trend in Las Vegas hotel-casino design that plays on the universal desire for excape from the mundane, workaday world, promising to whisk visitors away on a romantic escape. "If you find yourself magically transported to France, we've done our job," said Paul Pusateri, president of the new hotel-casino and its sister resort, Bally's Las Vegas. The effect begins with the exterior of the project, where intricately detailed re-creations of such icons as the Paris Opera House, the Arc de Triomphe and the Louvre attract the eye and stimulate the senses. The faux Eiffel Tower rises 540 feet above the Strip, affording spectacular views from its observation tower near the top of the structure and the elegant French restaurant 11 stories above the ground. The tower was built with the original plans for the Eiffel Tower, and even includes the same paint used on the authentic tower. Unfortunately, few got to see the view on opening night -- the fire marshal ordered the tower cleared shortly after 5 p.m., because of fireworks stored in the structure. The feeling continues with the exquisitely designed interior, whose capacious ceilings and airy lines of sight go a step beyond the well-received inside of New York-New York, the three-year-old city-themed property that generated the highest initial returns on investment of any new Strip hotel-casino in the past two decades. "The interior of Paris Las Vegas is much more focused on authenticity of design," Pusateri said. "We've incorporated some wonderful historical landmarks in a way that will set a new standard." Among them is a replica of the Rue de la Paix shopping district, complete with its cobblestone streets and quaint cafes, restaurants and retail shops, one of which is La Boulangerie. This working French bakery supplies the resort's fresh-baked breadstuffs to other Paris restaurants, delivered throughout the day by a costumed bicycle rider fluent in French. Nearby is Le Village Buffet, which offers re-creations of a town village and homes from the different provinces of France, each with classic cuisine from those regions in a menu that changes every eight days. The resort also features Parisian-themed lounges such as the lushly decorated Napoleon's Retreat and the bistro-styled Le Cabaret, both offering live entertainment. The passage to Paris' convention facilities incorporates a replica of the Versailles Hall of Mirrors. The attention to detail throughout the resort isn't due just to Paris Las Vegas' heartfelt homage to the original designers of some of the world's most-recognized landmarks, but also to the insistence by French authorities on quality. The licensing agreement that allows Paris Las Vegas to replicate the Eiffel Tower is an example. "We had to use the exact same paint and duplicate the lighting of the original," Pusateri says. Whether deserved or not, the Parisian reputation for rudeness to tourists hasn't been so faithfully duplicated, a tribute to the training the resort's employees received in the months leading up to the debut. The employees appeared to have the crowd well under control as entertainers walked along the barricades, treating waiting patrons to French music while teaching the crowd the French equivalent of "Good Evening." Inside, Arthur Goldberg said the event was anti-climactic for him. Goldberg is chief executive of Park Place Entertainment, the Las Vegas company that owns Paris Las Vegas. "I've been walking around here for four days now, and it's hard to turn it over to the people it belongs to now," Goldberg said. "It's going to become a landmark." The first group sprinted toward the doors, ignoring the pleas of security to slow down. But despite the fact that literally thousands of people were packed into a mob outside the doors, there didn't appear to be any shoving or crowd-related injuries. As the river of people flowed by him, Michel Ducamp, the executive vice president of hotel operations, happily puffed on a celebratory cigar. "We were expecting 20,000, 30,000," Ducamp said. "The crowd was very cooperative, very understanding. "We spent a lot of time going to the openings of other properties. We wanted to ensure the safety, security and health of our visitors. That's the most important thing." Hundreds of patient, courteous resort employees helped ease the opening-night crush, which filled every table game, slot machine and bar and lounge seat in the casino. Lines quickly formed at a bank of Megabucks machines, packed with superstitious slot players hoping to emulate the luck of a gambler who hit a big jackpot at the debut of the Mirage 10 years ago. "If I had to pick one thing that will distinguish this property, it would be the employees," said Goldberg. An hour before the first invited guests entered, Pusateri gathered hundreds of workers together for a last- minute pep talk, telling them opening night would be one they'd remember for the rest of their lives. Pusateri knows his job didn't end with the official unveiling of a well-designed property. His 13 years with Four Seasons Resorts, including stints as general manager of the luxury hotel chain's San Francisco and Beverly Hills operations, gave him an appreciation for the benefits of customer service. While that's difficult to deliver on a project the size and scope of Paris Las Vegas, "The opportunity to do something a little bit different in this town is truly exciting," Pusateri says. "We wanted to scale things down and offer a personal approach to our customers. The challenge is to interpret that, to do in a 3,000-room hotel what we can do in a 300-room property," he says. The personal approach for hotel guests begins with check-in, he says. "We've broken all front-desk tradition in Las Vegas by establishing separate check-in areas with just two stations each, separated by ornate wrought-iron gates. Employees will come out from behind the counters to escort customers and provide them with true personal service. "We look at the operations from a customer's eyes," he said. "For example, there won't be any ropes or stanchions, because if you have those, you're advertising you have waiting lines." The goal is to build customer retention, Pusateri said. "They'll try every property, but they'll come back to the one offering the best price-value relationship." "You put all this together and you have one hell of an equation for success," said Pusateri. However, such ambitious plans create new challenges, including hiring the 4,200 people needed to staff the resort. "We had to develop a work force that accepts the culture we need to implement our vision -- to treat others the way you'd want to be treated. It began with hiring and training the right employees and continues with execution and consistency," he said. "The excitement of doing all that on a project of this size and scope is tremendous," Pusateri said. So, too, is the challenge of meeting the financial projections expected by executives of Park Place Entertainment, as well as investors who've grown accustomed to the capital appreciation Goldberg has traditionally delivered to stockholders. Like other Goldberg executives, Pusateri adopts a cautious approach when he talks about cash-flow projections for Paris, pegging them at $120 million for the first full year of operations. "But that's an incremental increase from Bally's Las Vegas, which should show a slight cash-flow decline," he says. Jason Ader, senior managing director of Bear Stearns & Co., agrees with the Paris Las Vegas projection and maintains an "attractive" rating on Park Place stock. Calling it "a rare construction project for the desert city, as it will open on time and within budget," Ader says the new property should generate the highest annual return on capital invested -- 14 to 16 percent -- of any of the four resorts that have opened since last October. "Paris is an exciting and amenity-rich property that was a bargain to develop by Las Vegas standards," Ader said. "It also should help further the surge in visitation that was created following the openings of Bellagio, Mandalay Bay and the Venetian." Some analysts expect the adjacent Bally's cash flow to approach $100 million annually due to its linkage with Paris Las Vegas, while others expect some cannibalization of Bally's business as regular customers clamor to see the new property. A few also believe Paris Las Vegas will exceed the $120 million incremental increase Pusateri projects, citing the first-year performance of New York-New York, which posted $130 million of cash flow in 1997 with 900 fewer rooms than Paris. New York-New York's number fell to an estimated $100 million in 1998. With estimates for Paris' cash flow ranging from $120 million to as high as $160 million, the projections would translate to a return on the project's $800 million cost of 15 to 20 percent. While a bit lower than historical returns for the most successful new Las Vegas resort investments, such numbers would exceed the initial returns of Bellagio, Mandalay Bay and Venetian, the other three mega-resorts that have opened within the past year. Pusateri, who oversees both Bally's and Paris, notes that the two hotel-casinos share reservation and switchboard services and other operations, which will help to control costs. The properties also give Park Place Entertainment 5,700 rooms at the southeast corner of Flamingo Avenue and the Strip, a"critical mass" that analysts expect will benefit the combined operation. "We can capitalize on the Bally's brand name, which is very well known, and combine it with Paris, which will be a 'must-see' resort," Pusateri said. And it's not just tourists expressing interest in the resort. Paris Las Vegas' ballrooms and salons, coupled with those of Bally's, give the complex 315,000 square feet of meeting space, any or all of which can be booked through a single sales department. With Paris Las Vegas now open for business, there are three resorts left to debut in the current and largest- ever wave of Las Vegas hotel-casino construction. The $1.3 billion, 2,567-room Aladdin-Desert Passage resort on the Strip just south of Paris Las Vegas is scheduled to open next spring, the 496-room Hyatt Regency Lake Las Vegas project in Henderson is expected to open by year's end and locals oriented Suncoast opens in Summerlin in Fall 2000. The Venetian and the Resort at Summerlin, also part of the current wave, underwent "soft" openings with some attractions still unfinished. That fact wasn't lost on Goldberg. "It was brought in on budget and, more importantly, on time," Goldberg said. "We're not going to have three grand openings." HARRAH’S DISCUSSES GROWTH PLANS Tuesday, March 4, 2008 Since Harrah’s Entertainment went private in January, the company has been fairly quiet about its growth plans in Las Vegas and beyond. But that might be a function of its scaled-down public relations and marketing staff. During the company’s fourth-quarter conference call Wednesday, executives spoke enthusiastically about an under-construction hotel tower at Caesars Palace and plans for a previously discussed stadium behind the company’s Paris Las Vegas and Bally’s casinos. The 20,000-seat stadium plan, which still has plenty of skeptics, would be built by stadium and entertainment company AEG, which would also have naming rights to the building. The stadium would be built with a mostly tourist population in mind and would be able to accommodate a professional team as well as special events, concerts and award programs, Chief Executive Gary Loveman said. The stadium would also feature sky boxes that would be customized and occupied by their casino owners year-round, he said. The 665-room Octavius Tower, part of a $1 billion expansion at the company’s Caesars flagship, is on track for a 2009 opening. Executives said they are still working out a final figure for how much money the company plans to spend this year improving existing properties, excluding new construction projects. Sep. 26, 2009 OVERLOOKED RENOVATIONS: Work at Paris Las Vegas at issue Whistle-blower prompts 20 notices of violation By JOAN WHITELY LAS VEGAS REVIEW-JOURNAL As of midday Friday, county building inspectors had issued more than 20 notices of violation to Paris Las Vegas for unpermitted or substandard work they have uncovered while investigating a September complaint by a new whistle-blower, an electrician who was laid off from the Paris in February. With the help of former co-workers, electrician Paul Sepe said, he compiled a list of 33 overlooked renovations. The list covers many items that Harrah's Entertainment did not disclose to the county back in March 2008, when it was supposed to come clean on all renovations it did from 2000 to 2007 without permits or inspections at its local properties, which include the Paris. "We're actively investigating the items noted in the complaint," county spokeswoman Stacey Welling said Friday afternoon. She did not have an accounting of any deficiencies the Fire Department's separate investigation has found in Paris' fire-protection systems. Harrah's Entertainment did its best in its 2008 disclosure, company spokeswoman Marybel Batjer said late Friday via e-mail. "The list we submitted to the County represented a thorough review of over 2,000 projects -- the omission of these 29 projects was a simple oversight, and is now being addressed." Nine Paris projects were on Harrah's list. The casino company has been working "closely and very diligently" with the Clark County district attorney's office and other county agencies to remediate all projects that lacked permits, Batjer also wrote. Sepe, 48, who is unemployed, took his list to the county Fire Department, his union's out-of-town leadership and the Las Vegas Review-Journal, as well as several members of Nevada's congressional delegation. He worked at the Paris in building operations from 2007 to early 2009 - - and before that, at Harrah's Las Vegas. The county's notices to Paris cover deficiencies in areas frequented by guests, such as the sports book, restaurants, a wedding chapel, parking garage and the check-in area for so-called Diamond- level guests. Some employee areas -- such as restaurant kitchens, offices for risk management and Asian marketing, as well as the hotel's main phone room -- also contain work that fails to meet safety codes. A dramatic example of a hazard that Sepe reported to the county, resulting in a violation notice, was supervisors' decision to not upgrade the electric panel serving several air conditioner units that were added to cool a small mechanical room that houses crucial drives, which power the pumps for the entire property's air conditioning system. The notice orders the Paris to replace the panel, which has been undersized for about a year. If the panel started a fire, it could knock out all the air conditioning and create danger for guests or employees in the parking garage, on the seventh level where the mechanical room is. Sepe said some electricians warned bosses about the problem, but were ignored. He said he was told the air-conditioning units were programmed to never come on at the same time, the scenario that would trigger an overload. Sepe claims his Paris supervisors routinely had in-house workers do electrical renovations without permits and inspections, though they are required by law to ensure safety. Sepe said he deduced there were no permits for certain jobs because he and others never saw county inspectors at the scene, and those jobs were never held up waiting for inspections. "There is a set of (blue) prints in the electric shop, where the senior electrician wrote in red ink all the changes that were ever made," Sepe said, describing how he believes the hotel kept track of electrical modifications that don't show on official building documents filed with the county. Another clearly visible renovation without a permit -- which Sepe acknowledged that he participated in and has reported to the county -- was the wholesale replacement of ceiling light fixtures throughout the eight-story parking garage, which entailed extensive rewiring. A separate violation notice details that workers acquired some of the fluorescent light fixtures for the garage by cannibalizing "every other (fluorescent ceiling) light in the main back-of-house hallway," which reduced the hall's lighting. The workers reinstalled those fluorescents in the parking garage, eliminating high-pressure sodium bulbs, which consume more power. The electrician told the newspaper he decided to step forward because he was worried about building safety at the hotel. He said he had followed the news coverage of building deficiencies at other local Harrah's local hotels in the last couple of years, and did not believe the casino company had been entirely honest about the Paris. Clark County had requested a summary of covert renovations from Harrah's Entertainment last year, after the Review-Journal reported on never-inspected projects at Harrah's hotels, primarily at the Rio and Harrah's Las Vegas. Criminal arraignments of the parent corporation and two supervisors from the Rio and Harrah's on misdemeanor charges of violating building codes have been repeatedly postponed for more than a year as the hotel group documents code compliance at its properties. Sepe also said he filed the complaint in response to what he considers dishonorable behavior at Harrah's hotels by some members of his union, Local 501 of the International Union of Operating Engineers. One engineering supervisor at Paris has been a district representative in 501 leadership, which, according to Sepe, is symptomatic of a cozy relationship that benefits Harrah's Entertainment management and union leaders more than union members. Local 501's Los-Angeles-based business manager, Christopher Brown, did not return a phone call requesting comment. Batjer said the casino company sees no conflict in the union matter.