LAS VEGAS, Nev., April 23 (UPI) -- For two full years now, Vegas has been without a Steve Wynn casino. But like Renaissance courtiers gossiping about the king, the town's buzz is always about what Wynn is doing, may be doing, or could be doing.

After selling the Bellagio, the Mirage, Treasure Island and his other properties in 2000, Wynn bought the old Desert Inn, including the extensive golf course and country club property behind it, and announced that sometime in the future he would be back with a project that would top even his grandest mega-casinos of the past.

Six months ago he gave it a name--Le Reve, French for "the dream" and also the name of a Picasso painting that Wynn owns. At the World Gaming Expo in October, he even revealed a few details. It would be French and Asian themed and include four resorts in one, built around a huge Times Square-style "public plaza" full of Carriage Trade shopping, cafes and bistros. It would also feature a world-class art museum similar to the one he had at the Bellagio, a 48-story all-suite hotel and convention center, and a three-acre swimming pool. In addition, there have been reports that he's cutting a deal with Mohammed Al Fayed to establish a Harrods of London on the site. The whole project would be, in Wynn's words, "the single most wonderful resort in the history of Las Vegas."

Yet he still hasn't broken ground on the casino, and rumors have started to swirl. He has the money one day, he doesn't have it the next. He's partnering with Asians one month, and the Asians are gone the next. Since announcing Le Reve he's also been licensed to build a casino in Macau, the island near Hong Kong where China hopes to create a Far Eastern Las Vegas, but that project, too, seems on again, off again.

Why is Vegas so fascinated with this one man? Because, the myth goes, Steve Wynn is the visionary who saved Vegas.

When a Wall Street brokerage firm puts out a report on the gambling industry, they always include a "History of Las Vegas" time line. It doesn't begin in 1905, when the railroad incorporated the town, or in 1931, when State Assemblyman Phil Tobin of rural Humboldt County pushed through the Wide-Open Gambling Act. It starts in 1989, the year Steve Wynn used Michael Milken-backed junk bonds to open the Mirage.

At $750 million, the Mirage was the most expensive casino in history and needed a million a day in cash flow to break even. It not only got the million, but Caesar's Palace next door--until then the premier gambling resort in the world--had an 80 per cent drop in income in 1990. Steve Wynn was a lifelong hustler from upstate New York who had moved from running his dad's bingo halls in Utica to distributing meat to Vegas casinos to owning a piece of the Golden Nugget downtown to becoming a real estate speculator. (He got rich on a land flip, selling a small parcel Caesar's needed for expansion.) And now he had broken through to become the biggest dog in the yard.

"In 1987 and 1988 people were writing Las Vegas off," says Rob Goldstein, President of The Venetian. "There had been no new casino built since the seventies. Places that looked like the Riviera and the Sahara--that was the Strip. There were no new hotels. The last one was MGM--now Bally's--in 1972. The town had stopped. Wynn was clearly the guy who bet the money. Then [Kirk] Kerkorian came along. Those two guys spawned the Mirage, Excalibur, New York New York, MGM Grand, Luxor, Venetian, Treasure Island. Suddenly there were tens of thousands of jobs."

Oddly enough, Goldstein is one of the few guys willing to talk about Steve Wynn on the record, and he does so only in the most general of terms. Wynn is known as a bully with a temper, and no one wants to risk crossing him.

"I've been sued by Steve five times," says John L. Smith, the respected, mild-mannered columnist for the Las Vegas Review- Journal, "and I'd rather not make it six." It took repeated pleas to get Smith to finally meet for breakfast to talk about Wynn, and he was remarkably good-natured about Wynn's attempts to suppress his unauthorized Wynn biography, "Running Scared: The Life and Treacherous Times of Las Vegas Casino King Steve Wynn."

Wynn is especially sensitive about a Scotland Yard report from the early eighties that declared him unfit to own casinos in England. When Smith called Wynn to discuss the report a decade later, "he threatened to sue me within ten seconds of my broaching the subject." Wynn was probably the most powerful man in Vegas at the time--he was derisively referred to as "Governor Wynn"--and his furor resulted in the column never running. (It became a chapter in "Running Scared.")

Wynn's subsequent libel suit--which was originally based, not on the book itself, but on the catalog copy describing the book--was fought by Wynn and publisher Lyle Stuart for six years, going all the way to the Nevada Supreme Court, with Wynn at one point vowing that Smith and his family would end up on the street.

It's not the only time Wynn has tried to crush someone who refused to buy into the Steve Wynn Legend. His legal battles with rival Donald Trump are rife with spying, private investigators (Wynn likes to hire retired FBI agents), and the transcripts of conversations taped by recorders concealed in jock-straps. When investigative reporter Robert Friedman showed up in Vegas two years ago to write a profile for a men's magazine, Wynn told him he didn't like the "negative" people he was talking to and wouldn't grant an interview. Friedman said, "How do you know who I'm talking to?" Wynn then Faxed a list of everyone Friedman had interviewed, scaring Friedman because "the list was totally accurate."

"We'd rather not say anything publicly about Steve Wynn," says one analyst at a Wall Street firm.

"He's a visionary. Let's leave it at that," says another.

It's not recorded who first used the V-word to describe Wynn, but once it became part of his bold-face gossip-column name, as in "Visionary Steve Wynn," he started thinking of himself as a sort of modern-day King Tut destined to leave monuments to his brilliance in the desert.

Yet it's widely acknowledged now that Bellagio was his downfall. The total cost of the property is estimated by Wall Street at $1.9 billion, and even though it's still possible for it to make money, the profit margin is so small that he would have been better off spending the same money to build four smaller casinos.

"I mean, who knows?" says Jason Ader of Bear Stearns. "Maybe the Bellagio will last a hundred years. Then maybe it's a success."

The Bellagio's problem was that it didn't develop enough new business. Long-time customers of the Mirage simply moved down the street, so that it amounted to shifting money from one pocket to the other.

Yet the official Steve Wynn hagiography goes something like this:

Steve built The Mirage, and the people came. And the rest of Vegas followed Steve to glory.

Five years later Steve was restless, so he built Treasure Island, and the people came to see his pirate ship, and Vegas emerged as a destination resort. And it was good.

And then Steve led his people to Bellagio, but God punished Steve by turning Bellagio into a golden calf, and Wall Street wept. For Steve was a Man Ahead of His Time.

The Bellagio has become one of the favorite gawking sites in town, but Wynn's piece-de-resistance has such a rarefied theme that it is unrecognizable to the average tourist. (It's a scaled- down version of Lake Como, the resort on the Italian-Swiss border where European old money has vacationed for generations.) When it opened, its art collection alone was worth $100 million. (Wynn's continuing obsession with art is odd in view of the fact that he was diagnosed in the eighties with retinitis pigmentosa, a degenerative retinal eye disease that has brought him to the brink of total blindness.) The atmospheric prices in Bellagio's shopping mall ($1400 for a man's shirt is not uncommon) made it seem just too opulent for anyone but a handful of the super- wealthy.

Yet somehow it worked. The cash flow was so high that, although it didn't make much money, it certainly didn't lose money. In 1999, one of the best gambling years ever, Mirage Resorts--Wynn's holding company--gained about 2 per cent. By contrast, MGM Grand earned 85 per cent, and Park Place Entertainment a remarkable 97 per cent.

When Kirk Kerkorian finally made a tender offer for Mirage Resorts in April 2000, everyone braced for a battle of the titans. Instead Wynn went meekly. By June, MGM Grand had acquired Mirage for $6.4 billion, the biggest merger in gaming history. Only six months earlier, Park Place Entertainment had bought Caesars World for $3 billion, and that had been the biggest merger in gaming history.

"Thank God the arms race was over," said one analyst.

Or maybe just postponed. Even before he completed the deal with Kerkorian, Wynn had bought the Desert Inn and projected his next opening in the year 2004.

Meanwhile, the real "Father of the Strip" today is Kirk Kerkorian, chairman of the now combined Mirage and MGM properties. He built his first Vegas hotel, the Las Vegas Hilton, back when Howard Hughes was still in town, and his MGM Grand is the second largest hotel in the world. Almost painfully camera- shy, he's never done TV commercials, like Wynn, or presided over a demolition spectacle, like Wynn, or given interviews to the fawning local media, like Wynn. ("Steve chooses who interviews him," said Smith. "He likes people who ask questions like 'And what brilliant thing did you do next, Steve?'")

Kerkorian is best remembered as the man who angered Hollywood by dismantling MGM Studios, selling off its backlot and film library, but in retrospect it looks like he was despised more for being the first guy to understand that movie studio assets were worth more than movie studios. As chairman of the world's largest gaming company, he delegates the public relations side of the business to personable CEO J. Terrence Lanni, who is more in the mold of the energetic upbeat go-getter type that the Wall Street analysts love.

But if Wall Street has its way, the executive of the future will be someone like Glenn Schaefer, the statistics-crazy marketing-mad president of Mandalay Bay. "Schaefer is actually the guy who hit the pavement hard for years and proved to us that the gaming industry is a good business, capable of high multiples," says Ader. "He's the guy who told Wall Street that this was not a corrupt group of gangsters, but a highly profitable segment of the entertainment industry."

The new Vegas is fast approaching a time when it will be ruled by interchangeable executives instead of the once powerful and flamboyant characters who built the city. In 1946 it's estimated that Meyer Lansky's lieutenants took over the Flamingo less than 20 minutes after Bugsy Siegel had his head blown off while reading the paper in the Beverly Hills living room of his mistress Virginia Hill. The new Vegas managers are not that fast yet, but when Park Place CEO Arthur Goldberg died of a heart attack in October 2001, the panic on the street lasted only about half a day. Within two days the board of directors brought the highly respected Thomas Gallagher over from Hilton Hotels, where as general counsel he had engineered various mergers and acquisitions over the past three years and knew virtually everyone in the industry. Everyone applauded a perfect decision. Life went on. Profit margins were unaffected.

Meanwhile, the latest earnings reports were released, and the only hotels on the Strip returning 20-plus per cent on investment were three of the least expensive: New York New York, Flamingo, and Excalibur. The future, it seems, is not paved with Bellagio's fake marble, glass sculptures and filigree after all. It's those ladies with the gold-lame fanny packs and the tennis shorts, crowding into the King Arthur Buffet.

King Tut has retired to Lake Como--or maybe just Lake Mead. When he returns this time, his reception will include a healthy dose of skepticism.

© Copyright 2002 United Press International and Joe Bob Briggs

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