Casino owner Gaughan still profits from the business


Gas cost an average of 30 cents a gallon, Lyndon B. Johnson was president, and the population of Clark County was around 211,000 (about 100,000 people less than Henderson today) when Michael Gaughan took over the property. El Cortez in 1965.

Few have held a Nevada gaming license longer than Gaughan. He has built and owned some of the most recognizable properties in the Las Vegas Valley, including the Barbary Coast (now The Cromwell), Gold Coast, Suncoast, The Orleans, and South Point.

Born in Omaha, Nebraska, in 1943, Gaughan moved to Las Vegas in 1952 and then graduated from Bishop Gorman High School in 1961. He is the son of the late casino owner Jackie Gaughan, who owned El Cortez and participated in many other Properties.

Michael Gaughan merged his Coast Casinos business with Boyd Gaming Corp. in 2004, before separating from the company in 2006.

Gaughan, 78, now owns South Point and the Las Vegas Airport slots dealership. He has 2,300 employees working on the property, nearly all of whom he brought back after COVID-19 shutdown last March, he said. Gaughan plans to bring back about 120 additional employees when he opens the property’s showroom, ticket office and convention space.

He spoke to the Las Vegas Review-Journal late last month to discuss the COVID-19 pandemic, its casino, its philosophies, and how the business has evolved over the years. The interview has been edited for length and clarity.

The South Point is known for its arena and equestrian events center. How has your business fared without these events and other convention and meeting related activities during the pandemic?

There was none. To enter my arena, people on horseback do not have to wear masks. The arena has approximately 4,600 seats, but there can be no spectators. The other people seated are the participants and their families, and 95% of your equestrian events, they don’t draw people. I think for the equestrian events, like three or four of the 43 got a ticket, so everything is free. If you like horses, you can come here and watch them for free. But I had to shut down public viewing, but they left me horse shows. I just got it back last month.

Financially, what impact does this have on your business?

In fact, at the moment, I’m fine. It is not known if it was not for the pandemic, but the localities are doing quite well at the moment. What is happening is that a lot of places are saving money by not making the food and they have cut back on their spending. You don’t spend that much money on attracting people, so the margins have really gone up. I have the only open buffet in town. (Note: at least two other buffets in Las Vegas casinos are open in limited capacity, although the South Point buffet appears to be the only one open daily.)

Why are you keeping the buffet open when other game operators have decided it just isn’t worth it?

I do not know better? (laughs) Because I think a little different. Remember I am not a corporation. I lasted two years with Boyd. When Boyd and Coast merged, I lasted about two years and then I got out. This place started out as the South Point under Coast, and it opened as the Boyd Gaming Casino. Then, I was the second largest shareholder and I took over this place. They happily wanted to get rid of me, so I took this place back. It was then that the south coast became the south point. I don’t do well in the corporate world. I don’t know, I think differently. I delegate, I do not micromanage. If I run this place with an iron fist, they’ll crush me around here.

What is your philosophy for managing a hotel?

My first obligation is to my partner. Then you have the responsibility of your employees. The third responsibility is to the state because the state is your partner. Then the fourth is the customer. I don’t think the big casinos see this.

What do you think they see?

Dollar signs. I really think they want to kill the golden goose yesterday. A short term for a large company, a large public company, is a quarter. Short term. The long run is a quarter plus a day.

Can you tell me a bit more about your entry into Boyd and why you left?

Bill Boyd’s dad and my dad were partners – Sam. And Bill and I are still very close friends. I ran five places at the time and with different philosophies. I was making more money. But I think since Bill retired Boyd has become more corporate. I was just not happy, I will say.

Here we can make a big decision – a monster decision – in less than two, three days.

Why did you choose to buy a hotel and focus all your efforts on that hotel?

The thing is, they wanted me to go out. They wanted to know which hotel I wanted. They wanted to give me the Gold Coast. I wanted The Orleans. This place had just opened and I was well aware of the potential of this place, but it had just started, right? And I took this place. I didn’t want to do what they wanted to do. And not that they were wrong and that I was right, we just got – kind of death by 1000 cuts. I was tired.

Have you ever intended to sell South Point?

I have nowhere to go. A guy came over here and offered me a giant deal about two weeks ago – a big deal, probably worth more than the place is worth. I turned it down and it’s not, “Well, let me watch it and study it.” I just said, “No. It’s not the money; I have nowhere to go. I love to work and I am very well financially. It’s like in the movie “Chinatown”. I can’t eat better, drive better cars. So I like to work and I work for about five days. In fact, I am taking longer than usual.

Do you have an interest in buying another property?

At present? No, I am very happy. When I had the four or five hotels, it was a lot of work. And that way it’s more fun. I’ll tell you what I’m missing. I miss my arena in Orleans. I miss the Barbary Coast. I just miss it. The Barbary Coast was quite a cute place. It was my first real hotel. It was a five-year-old combat vessel on this corner. When they built the Flamingo, Flamingo Road did not go through the freeway. The first time I went to see the Suncoast I had to take a helicopter because there was no road up there at the time. And I got this land by accident because it got foreclosed, bankruptcy, and then the price was so cheap. I had no intention of building a place here. My managing director and (longtime friend and business partner) Tito (Tiberti), they convinced me to buy the land, it’s just a land investment. I knew how to do it, and a blind squirrel finds its nuts every now and then.

What do you think of this shift towards business consolidation of many casinos here?

It’s not that much fun. I don’t know anyone anymore, you know? I do not know anyone. Kirk Kerkorian was a close friend of my father and a good friend of mine; he left. The Caranos that I know a little from the north who bought Caesars. If you ask me to call someone at the Venetian, I don’t know anyone. Thirty years ago, I knew every valet parker. It’s just changed.

The Review-Journal is owned by the family of Sheldon Adelson, the late CEO and President of Las Vegas Sands Corp. Las Vegas Sands operates The Venetian.

Contact Mike Shoro at [email protected] or 702-387-5290. To pursue @mike_shoro on Twitter.

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