TERRY KEENAN, GUEST HOST: Call it SoHo on the strip. MGM Mirage (search) announcing plans today to build a mini city in Las Vegas (search), spanning some 60-plus acres, three hotels and more than 1,600 private residential units.
Joining me now to talk about these ambitious plans is the president of MGM Mirage, James Murren.
And Jim, welcome. Good to have you with us.
JAMES MURREN, PRESIDENT, MGM MIRAGE (MGG): Thank you very much, Terry.
KEENAN: You know, from the sounds of it, it's going to be bigger than Rockefeller Center, Times Square and SoHo combined. Can Vegas handle so much new capacity?
MURREN: Well, Terry, we really can. Las Vegas is a wonderful resort community. Today as you know, we're having a phenomenal year and probably a better next year.
But we have our sights set a little bit higher than that, a little bit more ambitious plan. It's a city without really a proper urban core, and that's the genesis of this plan. We're going to build a wonderful metropolitan market here that's going to attract a whole different customer, in addition to what we already have.
KEENAN: Yet much of America doesn't have an inner city core at the moment, unfortunately. And we've become a car society, an SUV society. Yet you're going to plan actual pedestrian walking areas, right? Do you think that will fly in so-called fly-over country?
MURREN: You know what? I know it will. As a guy that lived in Manhattan for 14 years and lived in several cities, I know the things that we need to have here.
We have a wonderful community. We have a burgeoning art community, a cultural community, an educational community, but we are a suburban bedroom community in large respects.
We need to have a much more dense, vertical, urban, culturally interesting environment at the core of that. That's what's happening in downtown Las Vegas right now, in an urban renewal that the mayor is undertaking. It's happening in, quote unquote, midtown where the university is.
This is uptown. And we're going to be able to do this in a privately funded fashion that will generate an enormous return to our shareholders, but also create a civic opportunity for everyone here.
KEENAN: I'm glad you're looking to New York City for inspiration for this mini city of yours.
MURREN: I am.
KEENAN: What you are seeing right now in terms of the economy, because you have your pulse on it in terms of your customers. What are you seeing right now?
MURREN: Well, we're having a record year. We had so far, you know, a record three quarters of result. And we're off to an extraordinary strong start in the fourth quarter.
Our occupancy trends are higher. Our per capita spending is going up. Our retail sales and restaurant sales are much higher. Our convention and conference business, in other words, the business traveler, that business is up double digits versus a year ago.
And we really think that we're going to have a tremendous 2005, so I would say all the economic indicators for Las Vegas are moving up, and that provides the basis by which we can build this type of environment.
KEENAN: And the Federal Reserve raising interest rates, you no doubt are going to have to borrow a lot of money to build this mini-Sin City. Is that going to affect your plans in the cost of all of this?
MURREN: No. Actually, as you are aware, we're acquiring Mandalay Resort Group right now. That deal will be done by the end of the first quarter.
And I have all the money. We've closed up on a bank deal. It was dramatically oversubscribed. We have all the financial resources to buy Mandalay without issuing any additional equity or any additional debt at all.
KEENAN: So money is easy to get out there, right, if you have a good company behind you?
MURREN: Right. Money is easy to get if you have a good story, a good track record, a good future. And that's MGM Mirage.
KEENAN: OK. Well, good luck. And we look forward to seeing it, opening, what, in about five years or so?
MURREN: We'll invite you.
KEENAN: OK. Thanks so much, Jim. Jim Murren.
MURREN: Thank you.
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