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Saving Las Vegas: The Downtown Turnaround

In the 1980s, a bold plan was concocted to save Downtown Las Vegas. It was just crazy enough to work.

Saving Las Vegas: The Downtown Turnaround

The Fremont Street Experience and the Viva Vision light show

November 1989 marked a turning point for the Las Vegas Strip.

Days before Thanksgiving, Steve Wynn opened his $630 million Mirage casino. News accounts called it a “Fantasy Island” come to life, a “South Seas dream” with 3,000 hotel rooms, cascading waterfalls, a tiger habitat and the property’s signature feature: a volcano that spewed lava every quarter-hour, to the amazement of passersby.

An Elvis impersonator, complete with Memphis twang, told a reporter the new resort would “give other hotels a run for their money.”

The faux King wasn’t kidding. The Mirage kicked off the megaresort era that in the next decade saw the openings of Excalibur, the MGM Grand, Treasure Island, Luxor, the Stratosphere, New York-New York, Bellagio, Mandalay Bay, the Venetian and Paris Las Vegas.

Those properties, plus a growing number of locals casinos and casinos across state lines, almost put a fork in the birthplace of Nevada gambling: Downtown Las Vegas.

Decline and Fall

A year before the Mirage, Downtown casinos commanded one-fifth of the region’s total gaming market and recorded an 11 percent uptick in gross gaming revenues. Less than two years later, those casinos posted a $39 million loss and drew just 16 percent of the market.

“In the 1980s, 80 percent of people who came to Las Vegas made at least one trip to see Fremont Street,” the main thoroughfare, according to Jan Jones Blackhurst, mayor of Las Vegas from 1991 to 1999. With the opening of the Mirage, “those numbers flipped, so less than 20 percent were coming. The whole economic engine of Downtown Las Vegas was threatened.”

“There was no energy Downtown, there were no people walking around,” agrees Don Snyder, then a commercial banker, later president of Boyd Gaming, who was deeply involved in what would become the Downtown renaissance. “It wasn’t just casinos but neighborhood businesses that were struggling.” Local shopping had been lost to malls. Seediness and the perception of crime also kept people away.

Tens of thousands of jobs hung in the balance, not just in gaming and hospitality, but in government. At the time, local, state and federal officials were looking to move their offices to Summerlin, a spanking-new master-planned community promoted by Howard Hughes as a new city center.

With nothing to lose, Downtown casino owners rolled the dice, joining policymakers to ensure old Las Vegas wouldn’t be left in the dust.

Plan A, Plan B, Plan C…

The Plaza’s giant Lichtenstein-inspired mural, “Behind Closed Doors,” by artist D*Face

In 1992, Snyder and John O’Reilly, former chairman of the Nevada Gaming Commission, helped found the Downtown Progress Association (DPA), a public-private partnership made up of casino owners including Bill Boyd, Jack Binion, Jackie Gaughan, Phil Griffith and Jerry Turk. Also on board: Mirage mastermind Steve Wynn, who also operated the Golden Nugget on Fremont Street.

These were big guys with big egos. Some were enemies as well as rivals. But as members of the DPA, they had a common goal and a one-for-all attitude.

Their ideas were big. Bold. Outrageous. And they had to be, to make a difference, says Snyder. “Like a rock thrown in a pond, redevelopment has to really make waves. That was the philosophy—to do something big enough to radiate off Fremont Street” to the rest of Downtown.

Wynn proposed recreating Venice in the desert, complete with man-made canals and singing gondoliers. That idea didn’t fly, but it got people thinking big (and later inspired Sheldon Adelson’s Strip resort, the Venetian).

Another concept was really out of this world: a life-sized replica of the Star Trek Enterprise. The space station would include a restaurant with translucent windows that would shift from views of Downtown to outer space and back again. An engineer from Disney’s EPCOT Center delivered the pitch, and for a moment, the plan looked like a go. But some worried it would be a one-and-done draw, and fail to attract repeat visits. Paramount chief Stanley Jaffe pulled the plug.

The third time was the charm.

The DPA recruited architect and urban engineer Jon Jerde. Jerde’s specialty was “placemaking,” creating “urban entertainment centers” that performed CPR on formerly dilapidated town centers. Jerde had served as “design czar” for the 1984 Los Angeles Olympics and was instrumental in the success of San Diego’s Horton Plaza and Minnesota’s Mall of America.

Jerde sized up Fremont Street as “two walls of exhilarating lights (the casinos) and two walls of darkness (the sky and street).” He proposed to “simply wrap the entire area in light, sound and motion.” The central attraction would be a four-block, nine-story canopy over a pedestrian walkway, brought to life by a dazzling sound-and-light show.

The concept was “beyond brilliant,” says Blackhurst, “in essence creating the world’s largest casino, because they all opened to the street. You could close it for special events. You could hold big Super Bowl parties down there.”

The overarching structure would make it an all-weather destination that was easier for cops to patrol. The nightly sensory blitz could change according to the seasons, the entertainment schedule and the holiday calendar.

The project was not without its critics, who opposed the use of eminent domain to develop the project, as well as the cost: about $70 million (twice that in 2022 dollars). “But we didn’t have a choice,” says Blackhurst. “We either had to create a spectacular experience, or what was happening on the Las Vegas Strip would close down Fremont Street.”

A new hotel room tax—2 percent for Downtown hotels, 1 percent elsewhere—offset the investment, and casino owners kicked in millions in support of the new attraction. “So local taxpayers didn’t pay a penny,” says Snyder, who became the first chairman of what would be called the Fremont Street Experience. “It was really the visitors.”

Good Vibrations

Derek Stevens’ Circa Resort & Casino

The space opened on December 14, 1995, and quickly proved its worth. “You saw a pretty immediate gravitation to the attraction, and that’s what it was intended to do,” says Blackhurst. “It absolutely changed the character of Downtown.”

Significantly, it spurred more development, and shored up the local economy against all the roller-coaster events that would follow, like 9/11, the Great Recession and the Covid-19 pandemic.

“The Fremont Street Experience put a ‘floor’ under the ups and downs,” observes Snyder. “It really created a lot more upside, even when things were down. It did everything we hoped for.”

The area’s newly cool vibe lured other innovators. In 2006, Michigan native Derek Stevens blew into Las Vegas, and would eventually put his thumbprints all over Downtown. The man called “Vegas’ modern carnival barker” and a “new-age Jack Binion” first bought the Golden Gate Hotel and Casino, then transformed the old Fitzgeralds gaming hall into The D and developed the Downtown Las Vegas Events Center.

Starting in 2012, Tony Hsieh’s Downtown Project pumped an estimated $400 million into real estate, dining, tech startups and other ventures in the district. In 2013, the late Zappos CEO relocated his company headquarters to Downtown’s former city hall building, bringing more than 1,500 employees with him.

They and other visitors flocked to new attractions like the Mob Museum and the Neon Museum, which paid homage to Las Vegas’ storied past. For thrill-seekers, there was the SlotZilla zipline, which followed a few years later. Forbes magazine hailed the revival, saying, “Sin City’s dynamic downtown neighborhood is filling up with cool cocktail lounges, hot restaurants and chic boutiques.”

Then came Stevens’ magnum opus. In 2015, he pulled down the old Las Vegas Club to build his Circa Resort & Casino, spanning a full city block at Fremont and Main, with a 44-story hotel, eye-popping three-level sportsbook, rooftop swimming pools and multiple restaurants and bars. It opened to great fanfare in October 2020, despite ongoing pandemic restrictions that forced patrons and employees to wear masks. In August, the resort debuted a 35,000-square-foot meeting and convention space, now open for booking.

“Circa is a really good example of things that create energy and synergy,” says Snyder. “The right type of project becomes a catalyst for investment and reinvestment.”

All that Glitters

The website of The D resort proclaims: “Maybe we’re biased, but we definitely think Downtown Las Vegas is better than the Strip—especially as the area continues to grow.”

And grow it does. Seth Schorr, CEO of Fifth Street Gaming, owner of the Downtown Grand, looks ahead to even more pedestrian-friendly attractions.

“It’s still not completely there,” he recently told the Las Vegas Review-Journal. “If you’re in New York City, you feel very comfortable walking 10 blocks because there’s always something open. Downtown Las Vegas has gotten to be more like that, and the more we grow, the more critical mass just connects all the different areas and creates a more robust, walkable Downtown.”

And what of the multimedia pedestrian corridor that set it all in motion? The Fremont Street Experience has undergone several multimillion-dollar upgrades over the years, and is now considered a Vegas must-see. Its colorful canopy and kinetic Viva Vision light show have become a favorite of filmmakers, having appeared in movies such as Con Air, Starman, 3,000 Miles to Graceland and The Hangover, Part III. The district continues its slate of adult-oriented, un-PC attractions that keep the sin in Sin City, like an all-night, pre-Thanksgiving pub crawl called DrinksGiving.

And the party keeps going. Las Vegas tourism peaked in 2019 at 42.5 million visitors, then plummeted to 19 million in 2020, but is back on the climb, and Downtown gets its share—according to the Las Vegas Convention and Visitors Authority, last year, 53 percent of all out-of-town visitors stopped Downtown, or roughly 17 million of 32.2 million people. The Fremont Street Experience puts the annual average visitation at 26 million.

Looks like the big gamble paid off. As Andrew Simon, current chairman of the Fremont Street Experience, noted in a recent interview, “If you look at the investments that have been going on at the billions of dollars over the last few years, Circa and then Zappos and Downtown Project… It’s a whole Downtown area that it really saved.

“Without the Fremont Street Experience, I’m not sure we’d see the Downtown we see today.”

The Main Event

Q&A with Jonathan Jossel, CEO, Plaza Hotel & Casino

If reinvestment reflects confidence, there may be no brighter harbinger for Downtown Vegas than the Plaza Hotel & Casino.

The historic Main Street property, fully remodeled in 2010 and 2011, now has four large-scale additions in the pipeline: an animated Carousel Bar under the Plaza’s iconic dome; a new rooftop patio at Oscar’s Steakhouse; a Pinkbox Doughnuts location that serves, among other things, doughnut milkshakes spiked with alcohol; and Downtown’s first smoke-free, social media-friendly gaming space, complete with the Brian Christopher Slots area that opened in 2021, the Plaza’s 50th anniversary year.

“Like our neighbors and city leaders, we’ve been committed to revitalizing Downtown Las Vegas into a destination known for great art, dining, culture, hospitality, and entertainment,” said CEO Jonathan Jossel in a statement. The new developments “will further these efforts and transform Main Street into an unforgettable and must-visit place in Las Vegas for food, drinks and gaming.”

GGB spoke to Jossel about Downtown’s unique personality and its recipe for success.

GGB: By reputation, Downtown Las Vegas is friendlier and more walkable than the Strip, with better odds for gamblers. Is that a fair assessment?

Jonathan Jossel: It’s indisputable that Downtown has better odds, whether it’s single-zero roulette, 3:2 blackjack, 10 times odds on craps, or video-poker pay tables you just don’t get on the Strip anymore. It’s friendlier too, and it has a lot more history. What was lacking before was the quality of the experience.

So you had the better odds, the history, the friendly people, but you didn’t have the reinvestment. That’s changed in the past decade. Now people can come down here for great restaurants, festivals, shows and live music. The Downtown experience today is second to none.

Is there a typical casino customer at the Plaza, and in Downtown casinos in general?

What we’ve learned here at the Plaza is that you have to be adaptable to everything. Today we have 800 people here for bingo, mostly women, 60 years old and up. Last month, we had the Life Is Beautiful festival. Next month it’s a rodeo, which might be a group of guys from the Midwest, Texas and Oklahoma. We pride ourselves on being able to adapt to all these different demographics.

That said, the core customer in our casino database is the drive-in market from California, Arizona and Utah, then the Midwest.

The Plaza is now adding a Pinkbox Doughnuts location and a patio at Oscar’s Steakhouse

Is Downtown “finished” at this point, or could it be better still?

It’s definitely come a long way, but in baseball terms, we’re not even in the bottom of the fourth inning. Downtown has a long, long way to go.

You have to give credit to Tony Hsieh, who was one of the first ones, along with us and a few others, that came into Downtown and started putting it on the map. But in terms of a finished product? We’re not even close.

That’s not to take away from what we’ve done. You can look across the street with Circa and their sportsbook—people are coming to see that. Or look at the Golden Nugget and the great improvements they’ve made. There’s just so much more that’s going to materialize in the next 10 years that will make Downtown Las Vegas a prime destination for the whole country.

And that’s what it’s all about, bringing people down here, giving them a great experience and getting them to come back and bring their friends and family.

With everything so pricy these days, are people still willing to come and play? Do you see any economic clouds on the horizon?

It’s an odd time, for sure. Hearing a lot about inflation and other macroeconomic impacts, you might expect that at some point things could just slow down.

But 2021 was the best year we ever had here at the Plaza, and I think 2022 could beat it. We’ve had the busiest 18 months ever.

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