The 338-room Ritz-Carlton Las Vegas opened in 2003 in then-fast-growing South Nevada community of Lake Las Vegas, 17 miles from the Strip. The AAA Five Diamond, Mediterranean-styled, $170 million hotel boasts vine-covered trellises and balconies, balustrades, shaded loggias and a Florentine bridge, aptly named the Pontevecchio, which spans 375 feet across the lake's inner harbor. The grounds include boutiques, a wedding chapel and gondola rides, and the resort has hosted such celebrities as Elizabeth Taylor, Celine Dion and the late Michael Jackson.
Now, the Ritz-Carlton announced the hotel will close May 2, and a company spokesperson partly blames an Orange County-born phenomenon: the so-called "AIG effect."
Just days after the federal government committed $85 billion of taxpayers' money to a bailout of insurance giant American International Group (AIG) in September 2008, senior execs from the troubled company headed to the swanky St. Regis Resort in Monarch Beach for a week of wining and dining of 100 top salespeople.
The uproar was deafening.
"The whole demonization of luxury meetings and companies' pulling back on having their high-end meetings in luxury hotels--. this has had a tremendous impact on Las Vegas," Ritz-Carlton spokeswoman Vivian Deuschl reportedly said.
Last year, revenue for U.S. luxury hotels fell nearly 17 percent, outpacing the 14 percent drop in the overall industry, according to an analysis by PricewaterhouseCoopers LLC. Revenue per available room, a fiscal measure of health in the industry, plummeted about 24 percent, compared with a 16.4 percent drop for the industry overall.
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Deuschl did not comment specifically on the Ritz-Carlton Las Vegas occupancy levels, other than to say it is lower than the company would like, but she did have an opinion about the ripples from the AIG effect.
"I can't think of another destination," she said, "that has had to defend itself more against comments from politicians."
They probably just need a nice vacation.