ITT Corp. on Wednesday unveiled plans to build a $1-billion gambling resort in Las Vegas, where existing casinos are bracing for the opening of three other huge casinos in coming weeks.
The New York-based conglomerate said it will take a decade to complete the entire 5,000-room resort and casino on land being purchased from billionaire Kirk Kerkorian, whose 5,009-room MGM Grand Hotel and Theme Park on the Las Vegas Strip will open in December.
The 35 acres of new property on the south end of the Strip sits next to the 185-acre Desert Inn, which the company's ITT Sheraton unit purchased in June from a Kerkorian-led investment group. It is not clear whether the two pieces of property will be combined for the project.
The most recent deal with Kerkorian is expected to close the first week in November, ITT Chairman Rand Araskog told Associated Press. ITT is also seeking a license to operate the Desert Inn and plans a $50-million renovation of that property, Araskog said. Further details of the project were not available.
ITT is making up for lost time in establishing itself as a major player in the gaming industry, where lodging companies such as Beverly Hills-based Hilton Hotels and Promus Cos. are already well entrenched. Earlier this year, ITT Sheraton's gaming efforts suffered a setback when the company's newly hired president--John V. Giovenco, who had led Hilton's casino operations--unexpectedly resigned.
"Gaming is going to be all over the place, and ITT wants to make this (Las Vegas resort) the crown of a nationwide" operation, said Peter Miller, executive vice president of Roffman Miller Associates, a Philadelphia-based money management firm that follows the gaming and leisure industries.
"It's probably good for Las Vegas in the long haul," Miller said, "but I wouldn't want to be any of those second-tier casino companies in Vegas anymore."
Casinos large and small will face increased competition from the ITT project and other sprawling resorts designed to attract families with activities besides gambling. Next week, for instance, Circus Circus holds the grand opening of the 2,500-room Luxor Las Vegas resort, which features adventure rides and other attractions under a 30-story pyramid. In late October, Mirage Resorts weighs in with its 2,900-room Treasure Island casino-hotel, where rival pirate ships will hold hourly battles on a lagoon.
The new Las Vegas resorts are opening while potential rivals--from card clubs on Native American reservations to riverboat casinos on the Mississippi--spring up nationwide at a rapid pace. While such new entrants could steal some Las Vegas-bound gamblers, many expect the spread of gambling to entice more people to visit the city.