Rio’s new owner shares vision of upcoming renovation

When Anthony Marnell built the Rio — a Brazilian-themed resort close enough to the Strip to attract crowds of tourists but far enough away from Strip traffic to appeal to locals — it caught the eye of the company that eventually became Caesars Entertainment.

The resort industry has a funny way of coming full circle.

Thirty-three years after the Rio first opened its doors in January 1990 under Marnell, his design company has been hired as an homage to the Rio’s history to oversee a $350 million renovation of the property that begins next month and with its first phase expected to take a year and a half to complete.

The property’s new owner, Dreamscape Cos., led by New York real estate investor Eric Birnbaum, officially takes over operations Oct. 1, giving Birnbaum plenty of time to make plans for his first foray into Las Vegas.

Great beginnings

Marnell’s Rio had many crowd pleasers as Southern Nevada’s first all-suite hotel product. A swimming pool with a waterfall, a Rio de Janeiro carnivale theme, some of the top buffets in the city and occasional appearances by Brazilian jazz musician Sergio Mendes greeted customers.

The hotel’s original three-wing, 20-story Ipanema Tower saw an expansion in 1997 with a 41-floor Masquerade Tower and a two-story retail and restaurant complex featuring the Masquerade Show in the Sky, a nightly parade of floats suspended from the ceiling.

When Marnell sold the Rio to Harrah’s Entertainment — a forerunner to Caesars — for $766 million in 1999, it resulted in more changes for the Rio. Under the Harrah’s/Caesars watch, Penn & Teller in 2001 began a record residency at the property unequaled by any other Las Vegas entertainer and the famed World Series of Poker made its home at Rio’s convention area from 2005 to 2021.

Caesars sold the Rio to Dreamscape in 2019 for $516 million. So now it’s Birnbaum’s turn to see what he can do with the Rio. Caesars is managing operations of the Rio through a lease agreement that runs through December, but Birnbaum, founder and CEO of the company, looks to make the switch to his Dreamscape team Oct. 1.

In an exclusive interview with the Review-Journal, Birnbaum explained some of his plans for the property, carefully not sharing too much detail to tip off competitors.

‘Modern-day look’

“First and foremost is getting the rooms up to a modern-day look,” Birnbaum said from one of the first rooms already renovated. “And, the Rio is certainly going to be a lot cleaner, that’s for sure.”

Birnbaum plans a look and feel of “approachable luxury,” he said.

“We’re really not looking to compete and get in a knife fight with the Wynns of the world,” he said. “Our goal is not to win on price and undercut the market by being the cheapest out there by any stretch of the imagination. What we’re really trying to do is balance value for experience. When I look at the market and look at who is focused on that, I find it very hard to find a real true competitor.”

Dreamscape has a plan to take about 10 percent of the rooms offline at a time in the Ipanema Tower, assuring that there’s no construction noise in the floor above and below the floor that’s getting the overhaul.

After 18 months, the second phase of renovation will occur with rooms in the Masquerade Tower.

Dreamscape has partnered with Hyatt Hotels to attract loyal Hyatt customers to the Rio. Birnbaum figures that relationship should also jump-start convention traffic at the property.

Birnbaum’s company plans to take advantage of the 250,000-square-foot convention facility that has separate access, ingress and egress. Conventions will be part of the strategy, but not the only strategy.

“There’s not just one thing that you can say, ‘Hey this is why a guest is going to come to your asset.’ You have to give them reasons, plural, to come to your asset. So a great gaming experience, hopefully great food, great ambience and a place that they feel comfortable with (is what Rio will offer).”

Buffets are out

As far as food goes, Birnbaum isn’t sharing any details about specific vendors. But one thing is certain: The buffets are out.

“They (Nevada Gaming Control Board regulators) kept hounding us about the buffet,” Birnbaum said. “And I was very honest and said unfortunately the buffet has probably seen its last day. It’s not that we wouldn’t be supportive of it and we certainly know the history of the buffet here, but from just a pure economic perspective, it’s really, really difficult to make that math work, and then when you layer in COVID and the way people’s sensibilities of having food out in the open and germs …

“People’s psychology has changed and as a result, we are not going to have a buffet, but we will be having a food hall that we’re very excited about and that we think will hopefully deliver a different but as good as an experience.”

Birnbaum has hired executives from The Cosmopolitan of Las Vegas, where that property operates Block 16 Urban Food Hall.

“It’s a great example of a well-executed food hall at The Cosmopolitan. Many of our executive team came from Cosmopolitan. We’re following a bit in their footsteps. Hopefully what you’ll see is something that’s more of a 2.0 version of that in our own way.

“I don’t know that we want to necessarily tip our hand just yet and say who those vendors are and who we’re partnering with, but suffice to say we’re aiming to elevate the product and give a real reason for people to want to come here.”

‘Rio Rewards’

Birnbaum said the casino would have all new slot machines and orientation with a new loyalty club on the way Oct. 1. It’ll be called “Rio Rewards” and Birnbaum promises that it will be “the most lucrative reward program in the city.”

And the entertainment lineup, for now, would remain the same as it is with Penn & Teller as the anchor performers with their hilarious takes on magic.

“I think they’re observing something like their 30th year at the Rio,” Birnbaum said. “We’re not going to be the ones to tell them that they weren’t going to be here for their 31st year. Part of the history of the Rio is Penn & Teller. We’re very excited to have them as partners and from an entertainment standpoint, I don’t want to give any more beyond that.”

Birnbaum was also cryptic about possibly restarting the Masquerade Show in the Sky.

“An element of that is in the cards,” he said. “All the floats still exist and are ready to be brought out. How we implement the floats and what narrative we do around that is still to be determined. But that’s certainly something that’s on the table.”

Birnbaum said he has been appreciative of Caesars’ management of the property through the transition, calling it “an unbelievably good, collegial partnership for us.”

But Birnbaum and Dreamscape are ready for their moment in the sun.

“We’re looking forward to showing off the product and we’re always going to be listening (to customers),” he said. “I wake up every day and think about how we can make the Rio better.”

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.