With sprawling new casino hotels Canadians don’t need a passport for a taste
When Bugsy Siegel built the Flamingo Hotel in Las Vegas in 1946, Nevada was the only U.S. state with legalized gambling. Unfortunately the infamous gangster was killed six months later, never to see his ultimate vision fulfilled.
Siegel’s gambling and resort oasis in the desert has grown incredibly ever since, each decade seeing more opulent casino hotels. But the city’s true legacy is the extent to which it’s influenced global hospitality. Some 60 years later, Vegas-style entertainment complexes continue to sprout around the world. They’re making a significant impact in the Canadian market as well, and if you think it’s just about gambling, guess again.
“Developers are eager to create entertainment complexes,” says Alain Miroux, general manager of the 349-room Hilton Lac-Leamy in Gatineau, Que. “A casino is part of the package, as most people gamble for entertainment. But with a world-class casino, a beautiful 1,000-seat theatre, a five-star hotel with luxury spa, incredible food and beverage facilities and a full-service conference area, Lac-Leamy has all the amenities people want when they’re looking to be entertained.”
Located just 10 minutes from downtown Ottawa, Lac-Leamy is a self-sustained vacation destination. Driving over the MacDonald-Cartier Bridge across the Ottawa River, the hotel stands tall in the distance. Being situated between two miniature lakes adds to the resort-like feel. And when guests reach the end of the long private road, enter the main lobby and pass underneath artist Dale Chihuly’s eye-catching blown-glass installation, they know they’re not visiting a traditional hotel.
“A group staying here once said they felt like they were on a cruise,” says Miroux. “They put their luggage in their room and never had to leave the premises to enjoy themselves. With so many choices, guests can spend three days without leaving the property, and they’re happy not to.”
That’s heartwarming for travellers seeking shelter from Ottawa’s -40 winters. The hotel also has an outdoor pool heated year round, allowing guests to take a hot-spring-like splash. In summer, boating, biking and beach volleyball are offered on site. There’s even a Bellagio-style fountain and fireworks show.
Lac-Leamy isn’t attempting to mimic Vegas, says Miroux, but he knows many guests have probably visited there, and expect something comparable, although on a smaller scale. “People are travelling more and getting exposed to different experiences,” he says. “We don’t have hotels the size of Vegas with 5,000 rooms, but the quality of what we are offering is at the same level, if not better.”
The entire complex is owned by Loto-Quebec, the province’s gaming corporation. The first phase saw the casino built in 1996, with the theatre coming after. Originally envisioned as a major tourism attraction, a hotel was vital. Loto-Quebec chose the Hilton brand for specific reasons. “They were looking for a brand with the same values, which could work with Loto-Quebec to promote the entire complex,” says Miroux. “And there were no Hiltons in the region, so there was an opportunity to expose the brand to the market.”
Opening in 2001, the hotel’s performance has been exceptional. Last year ended with 77 per cent occupancy, the highest rate in the region apart from a few extended-stay hotels. “We’re proud of what we’ve accomplished, growing tremendously in just five years,” says Miroux. ADR has also been climbing steadily.
That success is buoyed by a reputation for great service. In the four years it has been eligible for Hilton’s prestigious Connie Awards — given to the best of Hilton’s 240 hotels based on a rating compiled by guests and the company — Lac-Leamy has won three times, and it’s in the running again this year. “That’s what people see when they come here,” says Miroux beaming. “We’ve quickly established a culture of service excellence, which our employees buy into.”
The amount of group business sold is another big factor. Lac-Leamy has among the largest and best-designed convention spaces in the area. Sharing the same roof with so many amenities has proven to be a big draw for Canada’s top corporations, many wishing to reward attendees with a Vegas-style conference that’s got Quebecois flair.
“This property is a jewel, and because of that quality, people use it for any number of special occasions, such as weddings, anniversaries, and birthdays.” says Miroux. “Lac-Leamy is a destination for people who want to celebrate.”
In Canada, it’s important to note gaming is governed by provincial regulators, and the rules for owning and operating casinos differ depending on the province. The size and scope of a casino and all its associated amenities — such as hotel, theatre and restaurants — are determined by a Crown agent. In some provinces the Crown agent operates everything, and in others, a private-sector company is contracted by the Crown agent to run the show. Ontario casinos are a hybrid of both.
The issue of “comping” is also vital, as casinos like to reward regular casino players with gratis meals, show tickets or hotel rooms. When the hotel owner and the casino owner are the same entity, like at Lac-Leamy or Fallsview Casino (owned by the Ontario Lottery and Gaming Corporation), comps are seen as just another operating expense. But if the hotel operator is independent of the casino, another arrangement needs to be worked out. Either way, it’s about taking care of your best customers the best way you can.
Some provinces prohibit comps, and that’s key as developers look to build new complexes. Most want to maintain as much control over operations as possible — and comping is an important marketing tool.
When you consider the rapid pace of development, it’s easy to forget casino hotels are relatively new to the Canadian landscape. Not too long ago, an ingrained wariness of legalized gambling lingered. But as it slowly became more accepted in the late 20th century in Canada, a swath of new casino hotels followed.
“I think the concept of gaming as entertainment certainly has staying power,” says Lyle Hall, managing director of HLT Associates in Toronto. “Canada is actually a lot further along in gaming than a lot of Western countries, including the U.S., the U.K. and France. The industry has evolved, and the public’s perception about gaming has evolved considerably in the past 10 years.”
A 2004 study written by Hall reported casino gaming generated $6.2 billion in Canada in 2003, a 50 per cent increase from just four years earlier. “Consumer acceptance of gaming as an entertainment alternative has seen sustained supply growth,” he wrote. “Hotel accommodation is rapidly becoming ‘table stakes’ at new and exciting casinos everywhere from urban destinations to First Nations reserves.”
With the success of these entertainment complexes, it’s virtually assured more are on the way. In Quebec, its three casinos generated $859.3 million in revenues last fiscal year, with more than 11 million visitors, each spending an average of $71 a visit.
“B.C. is a great example of how the industry has changed,” Hall says from his Toronto office. “They went from table-game only casinos up until 1999, to recently completing the River Rock Casino Resort with 1,000 slots, 100 tables, a hotel and theatre, just six years later.”
Owned by Vancouver-based Great Canadian Gaming Corporation, River Rock, located in nearby Richmond, has been a huge success. Howard Blank, vice-president of Media, Marketing and Entertainment for Great Canadian says, “The landscape changed when the B.C. Lottery Corporation mandated future gaming sites, replacing antiquated ones, were to truly comprise the full entertainment experience.”
While there might be fewer casinos now in B.C., they offer so much more. River Rock has a 220-room luxury hotel, a 1,000-seat show theatre, lounges and numerous restaurants, a health club and spa, and a bustling casino. “Guests want to be able to come on property for one thing, and leave experiencing four, and that’s what we’ve given them,” says Blank. “We are getting a lot of crossover synergy.”
As the only all-suite hotel in greater Vancouver, River Rock has been full since opening in 2005. A mix of locals and out-of-town guests, many from Washington state and Pacific Rim countries, keep the property hopping. Blank says occupancy hovers between 75 and 80 per cent and ADR has been trending upwards. “We offer four-star service, and have so many amenities on site we’ve become a destination of choice for both leisure and business travellers.”
In Ontario, Casino Rama is the only First Nations hotel casino complex in the province, sitting on the Mnjikaning’s native territory outside of Orillia. It boasts 2,500 slot machines, more than 110 gaming tables, a 5,000 seat entertainment centre (which routinely brings in regular Vegas performers), and nine restaurants. In 2002, a 300-room all-suite hotel was added, and it’s proved to be an entertainment beacon for Ontario’s near north. Located about an hour from Toronto on the cusp of Ontario’s cottage country, Rama is perfectly situated to draw guests from most of south-central Ontario.
But unlike Ontario’s border casinos in Windsor and Niagara Falls, Casino Rama seems unaffected by the decline in U.S. tourists. “We are in the enviable position of not relying on American visitors, as the majority of our customers come from within the province,” says Andrei Kun, executive director of Hotel Operations. It’s a statement the numbers back up. “Casino Rama’s occupancy levels have been 100 per cent or greater every day of the year for the past four years,” Kun says proudly.
There are unique challenges to running this type of property, says Kun. “Operating a casino hotel is very different from a standalone property. The daily dynamics are not driven by the needs of business travellers, but rather dictated by the exciting pace of casino life, which is a 24-hour-a-day business. For example, we have 24-hour housekeeping personnel available since we could be cleaning rooms at 2 a.m., and reselling them at 3 a.m.”
Nevertheless, when guests spin the roulette wheel for the last time and return to their five-star accommodations, keeping them on site for the duration of their stay is the goal. It’s the dream scenario for every operator: sell them three meals a day (including room service), a spa treatment, tickets to a show, get them into the casino, and have them happily return to do it all over again, and you’ve got the formula for the perfect casino hotel.
Somewhere Bugsy Siegel is smiling.