Thursday, May 01, 2003
Copyright © Las Vegas Mercury

Local View: The saddest lady on the Strip

By Hal Rothman

Now that Planet Hollywood has emerged as the leading suitor for the bankrupt Aladdin hotel-casino, it may be that, for once, the property's never-ending foibles will be hidden behind the allure of the newest, hottest thing. I doubt it.

The new Aladdin's problems are the stuff of legend, the one giant failure of the great boom that made the new Las Vegas into the icon of post-industrial leisure and entertainment. The stillborn dinosaur baby of the Mirage Phase, the 13-year spurt of construction that followed the opening of the Mirage in 1989, the Aladdin came late to a crowded market and couldn't distinguish itself. Built around the 7,000-seat Theatre for the Performing Arts, once a unique venue in town but by 2000 only one of more than 15 theaters that hold 1,500 or more seats, the new hotel tried to capture elements of every recent Strip success. Spread too thin among too many kinds of attractions, the Aladdin lacked the kind of anchor that compelled people to come. The best it could do was Build-a-Bear, not exactly a draw for the high-roller set. Even worse, the new Aladdin perverted the Las Vegas formula: Instead of giving the middle class a luxury experience at a middle-class price, it offered the middle class a middle-class experience at a luxury price. A free-standing independent property in a town of clustered groups, it was both undercapitalized and unable to protect itself against larger and more voracious competitors. When receivership finally came, it was a relief.

The dismal performance of the new Aladdin shouldn't have been a surprise. The property at Harmon and the Strip has been cursed since it opened. No single location has been more unfortunate; no one place has seen more of the failure that so rarely has accompanied development on the Strip. The Aladdin has been the lightning rod for the problems of the mob era as well as every other kind of mistake that developers in this town can make.

Once, the prospects for the Aladdin were as bright as any on the Strip. Veteran hotelier Milton Prell spent $16 million on the property in 1966, ushering in a new era in Las Vegas. The first hotel-casino to be funded from the Central States Teamsters Pension Fund, the Aladdin transformed the nongaming Tally-Ho Hotel, itself a bad idea, with the construction of a large casino, a lounge, the 500-seat forerunner of the Theatre of the Performing Arts, a 150-seat gourmet room and plenty of other delicious amenities.

Prell's Aladdin ended an eight-year drought of new construction on the Strip, signaling the dawn of the era of mega-hotels. With mobbed-up Teamsters Pension Fund money as the capital to underpin growth, a decade-long revolution that bridged the gap between the shoebox money of 1950s mobsters and the Wall Street-backed construction of the 1980s began. Caesars Palace and Circus Circus followed, with the International, Landmark, original MGM Grand and others close behind. Poised to flourish with the city, the Aladdin's moment seemed to have arrived.

But the next three decades were one travesty after another. The mob ties soon became clear. Prell, who owned the Sahara and the Mint, sold to Recrion Corp., a descendant of the mobbed-up Parvin-Dohrmann development company, for $16.5 million just 18 months after the hotel opened. In 1971, the hotel sold for $5.125 million, less than one-third of its original price, proof that something smelled bad at Harmon and the Strip. This sense was enhanced a few weeks later, when the state gaming board approved the sale but refused to license three of the purchasers because of their mob ties.

A decade followed in which the Aladdin was as mobbed up as any hotel on the Strip. The hotel was accused of comping organized crime figures in 1974, investigations into kickbacks paid during construction of the Theatre for the Performing Arts followed, and a federal grand jury looked into the $25 million pension fund loan that paid for the project. By 1977, the grand jury expanded its inquiry into hidden ownership of the hotel. At a time when the mob was beginning to be forced out, when Hilton, Holiday Inn and Ramada brought their mainline funding to town, the Aladdin had the taint of the city's sordid past about it.

It all came crashing down in the 1980s. In the one instance when the state closed a mob hotel simply because it was a mob hotel, the Nevada Gaming Commission shut down the Aladdin--for three hours in August 1979. Judge Harry Claiborne, himself later defrocked, issued an injunction that reopened the hotel. Soon after, the Aladdin hotel corporation, its leadership and the Del Webb Corp. were indicted on charges of conspiracy, and once again the Aladdin was on the block. The courts overturned Claiborne's injunction, and the property was again closed from July 10 to Oct. 10, 1980. Johnny Carson of "The Tonight Show" led a management group that failed in its attempts to buy the place, but local legend Wayne Newton and Valley Bank succeeded in their purchase. Newton and veteran gaming man Ed Torres, tied back to Parvin-Dohrmann and the mob past, operated the property. This partnership unraveled too, with Newton selling to Torres, who charged that he'd been swindled and in the end sold back to Newton as investigations into the property continued.

In 1986, Japanese entrepreneur Ginji Yasuda bought the property for $51.5 million; by 1989, the corporation was in bankruptcy again. The property was offered in a sealed bid process, passed through a few more hands and ended in an $80 million purchase by Jack Sommer of the Sigman Sommer Family Trust. Even the subsequent implosion and rebuilding of all but the performing arts theater couldn't erase the past.

Maybe it was the location; maybe bad luck played a role, but no Strip property has fared as poorly as the Aladdin. No one place on or off the Strip showed so much of the bad that could happen when money overcame sense; nowhere did the problems of resort development and gaming seem so clear. Even as the suitors line up, the saddest lady on the Strip tips her frowzy tiara at the city. There's little reason to think that a declining brand like Planet Hollywood can do any better. Another unhappy chapter in the story of the hotel where Elvis and Priscilla once married is playing out.

Hal Rothman is a history professor at UNLV and the author of Neon Metropolis.