Why Wynn can't lose in 'the last honest place in America'

As another, $2.7bn monument to excess is unveiled, Andrew Gumbel reports from Las Vegas on the winning streak of the casino king and asks how long Sin City can stand the pace

A casino opening in Las Vegas is not unlike the premiere of a hotly awaited Hollywood film; the frisson of anticipation, the round of exclusive parties, the insistent whispers in the local press of celebrity sightings. More often than not, there are fireworks.

A casino opening in Las Vegas is not unlike the premiere of a hotly awaited Hollywood film; the frisson of anticipation, the round of exclusive parties, the insistent whispers in the local press of celebrity sightings. More often than not, there are fireworks.

The difference is that new casino resorts in Vegas are much rarer than new movies, the last being the ill-fated Aladdin in 2000. That only heightens the expectations.

And when the man unveiling the casino happens to be Steve Wynn, the undisputed king of the Vegas strip these past 15 years, the universal assumption is that he will show the world something extraordinary - something that will redefine Sin City and the way everyone thinks of it.

Thus it was that all Vegas held its breath last week for the opening of the latest Wynn extravaganza, the almost absurdly opulent Wynn Las Vegas, whose curved glass-and-steel form has been slowly rising from the northern end of the strip for five years. Built for a staggering $2.7bn (£1.4bn), it is by far the most expensive casino that Vegas - or anywhere else - has seen. In a town where money talks louder than words, that alone has grabbed everyone's attention.

The crowds were lining up outside the main gates eight hours before the official opening at midnight on Wednesday, and they stayed in line half the night to catch a glimpse of the mosaic-inlaid marble floors, the riot of colour co-ordinated flowers in the atrium, the on-site Ferrari dealership, the gallery of designer stores, and the 18-storey man-made mountain and waterfall that provide the backdrops to the resort's luxury restaurants.

The local newspaper, the Las Vegas Review-Journal, gushed in admiration every day for a week. The front page of Thursday's edition carried a special advertising insert from the rival Palms resort, congratulating Wynn and his wife Elaine and explaining: "You Make Us All Look Good". Nobody in this town expects the Wynn to be anything other than a roaring success.

Two decades ago, conventional wisdom would have told an entrepreneur like Wynn that he would be insane to attempt a project on such a scale. In those days, Vegas made the bulk of its living from ordinary middle-class Americans looking for deals on accommodation and food so they could focus on the gambling. The town was still largely controlled by organised crime syndicates, and not only was Wall Street not involved, it didn't want anything to do with the place.

Wynn has been at the forefront of the movement to change all that, raking in corporate investment on a gargantuan scale and making the slot machines and blackjack tables almost incidental to the other pleasures on offer - the restaurants, shops and the gallery in which he keeps his multi-million-dollar collection of impressionist masters.

His first mega-resort, the Mirage, was almost universally predicted to fail when it opened in 1988 - for the then unheard-of cost of $600m. But it made money from the very first day, and Vegas has been on a non-stop building boom ever since. The southern end of the strip, in particular, is now clustered with mega-resorts - some exotic (the Luxor and the Excalibur) and some imitating the great cities of the world (New York-New York, Paris and the Venetian).

At one point in the 1990s, Vegas seemed to be on the way to becoming a Disneyland-style resort for families and children, with Wynn's Treasure Island casino, featuring pirate ships clashing on a lake outside, acting as the centrepiece.

The 11 September attacks and the dip in tourist traffic that followed put paid to this dubious idea, though, and soon the town was luring visitors back with the kinds of things it had always promised: raunch, transgression and sin without guilt. "What happens here, stays here", went a catchy advertising slogan from a couple of years back, accompanying the revival in billboards for sexy stage shows and strip joints.

Wynn's new vision is to shoot for the absolute top end of the market. He first experimented with that idea when he opened the $1.6bn mock-Italian Bellagio in 1998.

The experiment suffered an unfortunate hiatus two years later when Wynn allowed himself to stretch his assets too thin and lost his Mirage Resorts empire to a hostile takeover from Kirk Kerkorian of MGM.

Almost straight away, though, he snapped up the property that has now become Wynn Las Vegas and put together a consortium of investors - notably, the Japanese businessman Kozuo Okada - to build the first of what he intends to be a series of resorts on the site of the old Rat Pack haunt, the Desert Inn.

Why is this working? How come the tourists continue to flock to Vegas - a record 38 million of them last year, with even more forecast for 2005 - when casino gambling has been legalised in more states than not? The answer, which Wynn appears to have anticipated, is that Vegas remains the mecca for gamblers and self-indulgent all-night entertainment-seekers. And if it's going to be special in people's imaginations, it certainly doesn't do any harm to be special in reality, too.

"Wynn's entrepreneurial genius was to create a script in which middle-class everymen could feel themselves at the centre of some unprecedented spectacle - a far cry from the original grungy gambling halls on downtown Vegas's Fremont Street," says the author and journalist Marc Cooper, who chronicled the rise of the new Vegas in his book, The Last Honest Place in America.

Wynn has undergone quite a personal transformation, too. The son of an East Coast bingo-hall operator, he had his share of encounters with the Mob early in his career - he was barred from operating a casino in London in the 1980s because of his alleged ties to organised crime - but ended up as the man who made Vegas safe for Wall Street. He made a special point, in fact, of blowing up the old Mob-run hotels to make way for his own creations. He dynamited the Dunes to put up the Mirage, and reduced the Sands to rubble before replacing it with the Bellagio.

The Desert Inn was its own wonder palace when it opened in the 1950s - featuring thermostats in every room, then a novelty, as well as a figure-eight swimming pool and a fountain that shot water straight up in the air. If Vegas felt at all nostalgic about its history, then this would have been one place for keeps. But Wynn snapped it up for $270m - as a birthday present to his wife, he said - and promptly had it razed to the ground.

Wynn certainly does not want for flamboyance, indulging in round-the-world art-buying sprees when the spirit takes him and living high on the hog in his own fantasy world when he is in town. (He was, loosely, the inspiration for Andy Garcia's casino- owner character in the Steven Soderbergh remake of Ocean's Eleven, the Hollywood crime caper.)

But he also has a sharp business sense of what he can get out of Las Vegas without worrying too much about what he can give back in return. Because of his casino makeovers and the success they have reaped, Vegas has become more expensive, more crowded, more polluted and ever less able to build an urban infrastructure at the same pace as its spiralling growth in population.

The profits, however, have stayed largely with the casinos and the corporations behind them. In Vegas, house prices have now shot up beyond the reach of ordinary casino workers, while schools and hospitals are woefully under-resourced and social services are constantly being cut because of Nevada's struggles to balance its state budget.

For all the excitement over the new resort, then, one can legitimately wonder whether Las Vegas is really on a sustainable track.

John Smith, a political columnist and biographer of Steve Wynn, likened the modern metropolis to the time in Nevada when silver was discovered near Virginia City in the north of the state. "Then, just as now, the robber barons made all the money. Sure, people were given jobs, but not for their creature comforts," he said. "Nothing has really changed."

Wynn's multi-billion-dollar gamble on the new resort is not without risk. The last big Las Vegas casino project, the Aladdin, went spectacularly wrong, nearly bankrupting its UK backer, London Clubs International. Wynn appears to be counting largely on the Asian market - indeed, he is actively cultivating it, via a separate $700m investment in a casino in Macao, among other projects. And he will also have to hope Las Vegas's visitor numbers are not compromised by another geopolitical earthquake - or, indeed, an attack on Las Vegas.

Wynn does, however, have two strong things going for him. One, he has now established a reputation for building first-rate casino resorts. They may be kitschy, but they are well-made, high-class kitsch. And second, he has long since appreciated a truth many Vegas punters would do well to remember: that in this town, the surest bet in a casino is to own the place.