Vegas Magazine - Niche Media - There is a place beyond the crowds, beyond the ropes, where dreams are realized and success is celebrated. You are invited.
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tions. "We came out of the gate strong and, with Deutsche Bank's support, made decisions that were provocative for Las Vegas," says Marchese. "We took the counterpoint on most decisions, realizing that if we tried to emulate the six other casino brands in Las Vegas, we would have been seventh." It was no lie when founding CEO John Unwin touted the Cosmopolitan as a property for the curious class, complete with on-the-cusp bands playing gratis gigs in a casino facing a sports bar and lounge, Book & Stage. An early performance by Best Coast resembled a scene from a Quentin Tarantino movie in the stunning incongruence of a rock group power- ing through songs before tables of serious-looking gamblers (whet her t hat encouraged t hem to cont inue r isk ing t heir money is debatable; the casino's new wager-friendly man- agement seems likely to tamp down on this sort of potential d ist ract ion). Ot her i n novat ions i ncluded a n ice - skat i ng rink with boozy ice cream for sale, a pool table – equipped hangout space welcoming the nongaming public, and a glass- walled room devoted to visiting artists. And then there's the invent ive (if f ina ncia lly ca la m itous) caba ret / rest aura nt / nightspot Rose.Rabbit.Lie., where a seemingly depressed mag icia n in dinosaur ga rb wa ndered a round doing ca rd tricks, Jazz Age tap dancers materialized on the bar, and crooners seemed to drop in from nowhere. Rose.Rabbit.Lie., where you can easily have a blast, remains open, but its operators have been dismissed and Cosmo has taken over management to keep costs in line. The club's spicy vaudeville-style show, which may have been a shade too blue for the Strip, has been mothballed. No one expected it to be a low-budget, low-risk operation, but it did seem to wear extrav- agance on its gilded sleeve. David Bernahl, whose Coastal Luxury Management launched the venue, bragged about his decadent Champagne jaunt through France—Rose.Rabbit. Lie.'s mammoth list of interesting bubbly is certainly evidence of four-star research—complete with photos of empty bottles. Upon seeing iPhone images from an afternoon's indulgence, chef David Myers (of the Cosmopolitan's recently shuttered Comme Ça) wanted to know, "How can you guys possibly drink that much Champagne in a single day?" From the outside, the Cosmopolitan looked like the hippest spot in Vegas. On the inside, though, no matter how often the rooms were filled (occupancy ranked among the highest in town) or how much they cost (again among the highest in town), the place was so leveraged that it could never turn a profit. For four years, Deutsche Bank accepted losses without tears and, to the bank's credit, continued to fund innovations and expansions. While Marchese says she can't imagine that the bank wanted to be a long-term casino owner, "they under- stood the brand. The way to make something memorable and achieve the highest room rates was to create an asset-based property that people cared about. We grew faster than the mar- ket in almost every line of the business. It didn't feel like we were unprofitable"—never mind that the Cosmopolitan had at least one $25 million quarterly loss and never finished a quarter in the black. "It felt like we were getting better every year." Now, with its sale to the Blackstone Group, a multinational private-equity investment fund, for the relative bargain price of $1.73 billion, the Cosmopolitan has a chance to be profit- able a nd to compete on a f ina ncia lly level play ing f ield. Newly hired President and CEO Bill McBeath, previously president and COO of CityCenter, believes in this second act to a degree that goes beyond rhetoric. He's done the thing that few newly recruited executives would dare, especially at the helm of a historic money loser. Upon his hiring, he explains, "they told me that I could invest in the operation. I asked what sum would be meaningful." Word has it that McBeath and Blackstone agreed on something in the neigh- borhood of $1 million. "I think Blackstone bought this asset on t he lower point of it s t rajector y. I've been bet t ing on myself my whole life and didn't think twice about this one. In fact, I think it's the surest bet I have ever made." McBeath is a sharp guy and a bit of a gambler at heart. He's a straight shooter who plays high-stakes poker and bets the big games. He's a rodeo fanatic who, after leaving CityCenter, Ground is broken on Eichner's project, which he calls The Cosmopolitan. Completion is expected in mid-2008 at a cost of $1.8 billion. Developer Bruce Eichner purchases an 8.7-acre plot of land for $60 million, fnanced by Deutsche Bank, where he plans to build a residential structure featuring giant guitar-playing robots in the lobby. Eichner defaults on his $768 million loan from Deutsche Bank. The bank initiates foreclosure proceedings but continues to build at the site. Deutsche Bank will wind up spending $4.2 billion to complete the Cosmopolitan. The casino is redesigned and moved Strip-side. October 2005 Spring 2004 February 2008 April 2008 from top: Signs for Laurie Simmons's show "Pause" at P3 Studio; Lady Gaga and Tony Bennett at The Chelsea on New Year's Eve 2014; a wraparound terrace with a view; Jay Z at Cosmo on New Year's Eve 2010. 88 vegasmagazine.com