MGM Mirage executives will unveil details on the progress of Project CityCenter, a $5 billion urban core that MGM Mirage Chairman Terry Lanni said is the largest and most expensive private development under way in the United States. CityCenter will cover an area bigger than New York's Rockefeller Center, Times Square and SoHo combined, Lanni said.
On the drawing board are a 60-story, 4,000-room hotel-casino and 500,000 square feet of retail space. In addition, two nongaming boutique hotels, including a five-star property, will have 400 rooms each. The development is also slated to include two 500-unit condominium high-rises in a rental pool similar to the company's Residences at MGM Grand. Both boutique hotels will have about 200 condominiums each, and 140 condominiums will be incorporated into the retail district as lofts, brownstones or other attached-housing styles.
MGM Mirage, which is about halfway through a 20-month design process for CityCenter, has not established designs, prices or a beginning sales date for the condominiums.
MGM Mirage will also announce this morning the roster of architects working on CityCenter. They include Connecticut-based Cesar Pelli and Associates, which designed the world's tallest buildings, Malaysia's Petronas Towers. Cesar Pelli is the lead architect on the 4,000-room hotel-casino.
Rafael Violy Architects of New York, which designed Philadelphia's Kimmel Center, will create plans for the condominium-hotel towers.
Kohn Pedersen Fox Associates of New York and Adam Tihany, who designed Mandalay Bay's Aureole and The Mirage's Cravings, will design the five-star hotel.
Sir Norman Foster, a London designer who has won architecture's renowned Pritzker Prize, will design the exterior of the second boutique hotel.
Amsterdam-based Gensler is the executive architecture firm overseeing design of CityCenter, and Perini Corp. will be the general contractor.
The Light Group, which operates the Light nightclub and Fix restaurant at Bellagio, will operate one of the boutique hotels. Lanni said MGM Mirage will soon announce the five-star hotel operator. The company is also working with several architects on possible designs for the retail space.
Lanni said CityCenter is a necessary new direction for development on the Strip.
"There's not a city in the United States that is ahead of Las Vegas in the quality of dining, the quality of accommodations and the quality of entertainment," Lanni said. "What doesn't exist on the Strip is permanent residences. (CityCenter) brings in that living component. It creates a new core, a center for Las Vegas."
Andrew Zarnett, a gaming analyst with Deutsche Bank, said CityCenter will redefine MGM Mirage and the Strip."This is going to be the center of the new vertical development of Las Vegas on and off the Strip," Zarnett said. "Clearly, it will be the lion's share of MGM growth over the course of the next decade or many more years."
Hal Rothman, a professor of history at the University of Nevada, Las Vegas, said CityCenter could also reshape the demographics of the Strip. While most resort destinations have more condominiums and timeshares than hotel rooms, Las Vegas has always been a "room destination," Rothman said. That will change when CityCenter opens in late 2009.
"CityCenter has kicked off a revolution in property development here that will give the market a reasonable share of privately owned properties," Rothman said. "The question becomes, Will people live in them? I don't know if anyone knows the answer to that yet."
It's an important question, Rothman said, because visitors who spend $250 a night to stay in the Strip's upscale resorts could decide to buy a Strip vacation home instead. If buyers rent their condos out, that could skim market share from hotels, compelling resort operators in turn to look for new visitor markets.
But Lanni said CityCenter will add amenities to an area that is relatively under-served in sectors such as retail, thus boosting area properties such as the Aladdin and the nascent Harmon Avenue Corridor east of the Strip, where the Related Cos. and Starwood Hotels and Resorts are planning big projects.
"If we were merely building (room) capacity without excitement or a spectacular approach, that would really burden the marketplace," Lanni said. "CityCenter will be a new paradigm for decades to come. It will give people more to do and make other nearby properties more valuable."
Lanni said 350 of the company's 832 Strip acres are undeveloped or underdeveloped, and that translates into the potential for additional development. Future phases of CityCenter could involve residential development on land behind the Monte Carlo and New York-New York, which MGM Mirage acquired when it bought Mandalay Resort Group in April.
"The most important thing to understand about (MGM's) acquisition of Mandalay Bay is that MGM decided to hitch its star to Las Vegas," Rothman said. "At this point, we have a homegrown company dominant in the city and, to a large degree, in the industry. CityCenter further commits MGM to Las Vegas. At the same time, it further commits Las Vegas to MGM."