Stratosphere owners tout $20 million makeover

Brass and blond veneers are out. Brushed nickel and darker woods are in.

It's these kinds of touches that permeate the Stratosphere's renovation at a cost of more than $20 million. Although much of the work took place last year and was finished by New Year's Eve, the hotel's management has decided that now is the time to take it public with a new marketing campaign.

The centerpiece, which took up the largest but unspecified share of the budget, was the renovation of 909 of the resort's 2,427 rooms into a tier called Stratosphere Select that is positioned to cost $10 to $20 a night more than its other rooms without a Strip view. The new rooms come with tile on the bathroom floor instead of linoleum, granite counters instead of laminates and different patterned bedding.

"Regardless of what the prices may do, it is very nice to have a repositioned property to compete with," new general manager Paul Hobson said.

As a wide range of surveys have shown for months, the thousands of new luxury rooms on the Strip have outpaced the increase in visitors and prompted significant discounting there. This has, in turn, increased pressure on properties in the budget and middle markets, such as Stratosphere, to hang onto their customers.

Visitors have decided to trade up from where they would have stayed in past years, said Stratosphere marketing director Todd Ford, choosing more opulent rated hotels that might cost only $30 to $40 a night more. Some hotels, such as The Westin and Riviera, could not compete and have defaulted on mortgages or gone into bankruptcy. Stratosphere, owned by an affiliate of Wall Street titan Goldman Sachs Group, decided to put money back into the hotel to try to move upmarket even though it is one of the properties that has had to discount to maintain occupancy.

"Timingwise, it is a fairly compelling case to do this now," Hobson said. "Lots of properties are capital constrained and can't make the investment. As the economy turns, we are prepared to benefit."

However, he does not try to predict when the local tourism market will recover.

Hobson said he hopes a revival of downtown will give the Stratosphere more of a feeling of being in the heart of the tourist and convention area.

The Stratosphere's formal entrance has been moved, along with the valet parking stand, to the front of the building on Las Vegas Boulevard. New carpeting was laid in the casino and marble was added in sections of the main and elevator lobbies.

Since new arrivals were walking in the front door and wondering where to check in, a ramp and marble were used to create a path to the registration desk.

"Instead of pushing people around with signage, we decided to let the floor do the talking," Ford said.

The ceiling lights in the casino change color in a continuous cycle. The VIP check-in area was roughly doubled in size and enclosed. Brass railings were swapped out for nickel.

The Starbucks on the 108th floor of the observation tower was replaced by a bar. And locals can now ride the elevator free Sundays through Thursdays.

American Casino & Entertainment Properties, which owns the Stratosphere, two Arizona Charlie's casinos and another resort in Laughlin, posted a $19.3 million loss during the nine months ended Sept. 30. The properties posted an operating profit but not enough to cover the interest payments on the debt. Revenues were $257.9 million, down 6.4 percent from the same period in 2009.

Hobson said the renovations were just the first installment of a plan to cover the entire hotel, including all the guest rooms. But he added that there was no timetable on when other renovation work will proceed.

"We would like to get to the other parts, but that will be contingent on the success of this phase," he said.

Contact reporter Tim O'Reiley at toreiley@reviewjournal.com or 702-387-5290.