Wynn’s Big Bet

Maybe it makes perfect sense that Steve Wynn would turn into the Mister Rogers of Las Vegas. Sitting in his new hotel in a red V-neck sweater and gray wool pants, Wynn, 63–famous for yelling at employees, taking up steer roping and accidentally shooting off his index finger in his office–is talking about building neighborhoods in his latest land of make-believe. Explaining that his hotel will be a mellow retreat, without the glitz and campy themes that have made him such a sensation in the past, Wynn breaks into a rendition of Bali Ha’ifrom South Pacific.Then he takes out a pen and starts sketching a picture of his hotel before launching into a touchy-feely description of its varying moods and, leaning forward in his chair, teaching me a little lesson about the importance of loyalty. I am deeply afraid we are going to hug.

If anyone is allowed to morph this dramatically, it should be Steve Wynn. After all, Wynn turned a city that was a pit stop for male vice into an international family destination. Expectations that he was going to top his past extravaganzas were so huge that when he started construction on the lush, waterfall-laden, 140-ft. man-made mountain in front of his new hotel, the rumor in town was that he was building a ski resort on the Strip. But Wynn Las Vegas, which opened last week, exudes an anti-Vegas, almost Buddhist quietude. There’s no theme, no showstopper like the volcano he built outside the Mirage in 1989, the pirate ships he put outside Treasure Island in 1993 or the giant pond he created with fountains choreographed to songs for the front of the Bellagio in 1998. “Theme parks are a collection of wows,” says the man who not so long ago turned Vegas into a theme park. “Hotels are places that have a range of emotions. You’re supposed to tarry.” Yes, Steve Wynn wants you to come to Las Vegas to … tarry.

“This is the most understated overstated hotel in the world,” says Wynn. “It’s held back just a touch.” Even though it’s ridiculous to describe a $2.7 billion, 2,716-room hotel with a man-made lake, massage tables in the suites and Wynn’s huge signature on the top of the building as understated, in Vegas terms, he’s right. There are low ceilings, short hallways and lots of nooks that make the place feel intimate and isolated. In a radical break from casino logic, there is natural sunlight everywhere, and all the restaurants and bars have outdoor seating. The mountain shields the hotel from the Strip, so you feel as if you’re separated from the insanity, even though it’s just outside. It’s like doing Vegas from a luxury box.

The transformation began a few years ago when Elaine, his wife of 42 years, started getting into Buddhism. Last year he had a two-hour meeting with the Dalai Lama, which she says profoundly changed his life. “Whenever Steve gets all uptight and starts to blow, I tease him and say that’s not what the Dalai Lama would do, and it helps him greatly because he knows intellectually that he’s on the right path,” she says. “Guys who are entrepreneurial tend to give short shrift to the family. He’s become a much better family man as he gets older. He’s become a very good grandfather.”

You can see his new Buddhist-inspired restraint in the intricate details on the new hotel, which Wynn is obsessed with, despite an eye disease that causes him to rely on subtle tricks such as holding on to people’s arms when he talks to them and leading them into direct sunlight. “His challenge actually helps him,” says Don Marrandino, Wynn Las Vegas’ original general manager, who has nothing but praise for Wynn, despite having been fired. “He can focus way more on space. You know how some people can close their eyes and see things? He can do that all the time.” Five years ago, after Kirk Kerkorian’s MGM Grand bought Wynn’s Mirage Resorts for $6.4 billion, Wynn spent 11/2 months with a sketchbook, walking around the 215 acres he acquired at more than $1 million each when he bought the Desert Inn (which he had torn down). He also hired real estate mogul Irwin Molasky to quietly buy up the adjacent homes. “When I bought this piece of property, I laughed,” says Wynn. “I said, ‘This is the most valuable piece of property in the western part of America.’ I had to [pay] $270 million, and I had it that morning.”

Wynn came up with the idea for the mountain as a way to block the view of the aluminum spaceship– themed entrance to the Fashion Show Mall across the street. “A lot of these guys will hire architects and designers to come up with ideas. Steve is the driving force in all his buildings,” says Frank Fertitta III, 43, the CEO of Station Casinos and a longtime friend, one of the group of young Vegas tycoons Wynn calls his “homeboys.”

In fact, it’s the challenge of getting it just right–of capturing exactly what America wants–that Wynn finds intoxicating. Looking back, he has little sentimentality for his earlier projects. “I don’t latch onto things. They’re just exercises in practicing my trade,” he says. But in the thick of creation, he’s fully engaged. “The 21/2 years of designing this hotel were like 90 days to me. No one saw me. I worked six days a week, and I was in ecstasy,” he says. “Then we had to get financing, and that was work.” It dawned on Wynn that his earlier, exhibitionist model–battling treasure ships outside Treasure Island, for example–needed to be turned, literally, outside in. “I thought, Could I have been wrong all this time about the feature being in the front of the hotel?” says Wynn. “The audience shouldn’t be on the sidewalk. It should be inside–eating, drinking, gambling, shopping. I had it 180 degrees wrong.” Now he regrets giving people across the street at the Paris hotel free shows of his dancing waters at the Bellagio. “If I knew this then, I wouldn’t have put tigers for people to walk by at the Mirage. I would have integrated that experience organically.”

Yet despite all the talk of organic spaces, Wynn can’t completely keep the old showman in check. His original plan for the hotel called for a small, intimate, all-suites establishment. That didn’t last long. It was also supposed to be named Le Rêve, after the Picasso painting, instead of Wynn, after himself. He was certain for years that he wanted all the signs in the hotel to be sleek and minimal. Then he saw the giant Louis Vuitton sign in his retail space a few weeks before the opening. “Now that’s a sign!” he told his employees. All others were soon replaced by signs twice their size. The guy who once had Frank Sinatra pinch his cheeks for a commercial and who earlier this year had helicopters shoot videotape of him while he stood on a 5-ft.-wide catwalk on the roof of his 50-story hotel for a new TV ad is just getting going when it comes to promotion. His giant signature is not only on the top of the building and the clock radios in every room but also underneath the sheets on the mattresses. The man is even branding himself to his maids.

He plans to slap that giant signature around the world. His company, Wynn Resorts, is set to open Wynn Macau in China next year, has bid for a gaming license in Singapore, is investigating a London property and in 2008 will finish Encore, a $1.4 billion, all-suites hotel on 20 acres adjacent to the Wynn. Within a decade, the company intends to rip up Wynn Las Vegas’ brand-new, Tom Fazio–designed golf course to build housing developments and entertainment facilities.

Wall Street, suddenly, loves the plan. When Wynn Resorts went public in 2002, demand for shares was so soft that Wynn put up $150 million for the $13-a-share stock. Since then the stock has soared, closing at $53 last Friday. Much of that price is high expectation about his new Macau property, due in 2006, which is part of an influx of American casinos setting up shop there.

For some people, building a $2.7 billion hotel–with plans for a $1.4 billion one next door–would be gambling, but Wynn doesn’t see it that way. He agreed to take his new company public only after Wynn Resorts president Ron Kramer argued that the influx of cash would remove pressure to open the new casinos quickly or generate immediate profits. “Steve is a very conservative guy. He is not a gambler in any sense of the word,” says Kramer. “He said, ‘I want to build a company that will outlast me.’ That’s a very different point of view than someone who buys a property and leverages himself 6 to 1.”

Oddly, Wynn isn’t very interested in gambling. His bingo-parlor-owner father, to whom Steve was reportedly close, was a compulsive gambler. On the eve of his father’s cancer surgery, as an English major at the University of Pennsylvania, Steve sat at his father’s bed, tallying more than $200,000 in the elder Wynn’s outstanding debt. Steve made his first major foray into Vegas in 1972, buying an interest in the Golden Nugget, a seedy downtown casino. He overhauled the place, then built a new Golden Nugget in Atlantic City, N.J. (with financing from junk bonds floated by Michael Milken). His next big move put an indelible stamp on the Strip: Wynn opened the Mirage, a shimmering temple of camp, with white tigers behind glass in the lobby, Siegfried and Roy, and a volcano. Gambling was still the big money earner, but with Mirage, Wynn transformed Vegas into a middle-class family destination.

Nowadays Wynn hopes to shrink gambling to less than 45% of the overall take at his hotels; he says he would remove it from his tranquil new oasis entirely if he could. “I do need the cash flow from the casino to justify the things I do,” says Wynn. “I wouldn’t want to dumb down my hotel–not at this point in my life. How many guys get to try to build the best hotel in the world?”

Wynn believes the best Vegas hotel will cater to what people really crave: calmness. He figures that now that he has helped defang gambling and strippers to the point where they’re in every town and on many websites, the real luxury is doing swankier versions of those things in a relaxing environment. Instead of squeezing in an hour to bet online while your kids are yelling, you get to play blackjack by the pool and stare at a waterfall while dancing at 3 a.m. The Mister Rogers of Vegas is hoping you’ll want to take off your sweater, put on your slippers and sleep off your sins in one of the classiest hotels in the world. •