Hotel Brands Come To the Rescue in Las Vegas

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With the Las Vegas tourism business still suffering, the hotel brand companies are coming to the rescue. Yesterday, IHG announced a 10-year strategic agreement with Las Vegas Sands Corp. to affiliate its dual properties—The Venetian and The Palazzo—with InterContinental Hotels & Resorts. The move follows Marriott's deal in August with the soon-to-open Cosmopolitan Resort to add that Strip casino property to the brand company's Autograph Collection.

For Las Vegas Sands, the agreement adds a lot of marketing firepower to its two hotels in a time when the Las Vegas market strives to rebound from its worst downturn in history. Once the affiliation takes effect early next year, The Venetian and The Palazzo will be connected to IHG's vast distribution network, including its websites, 10 worldwide call centers, global sales force and, perhaps most importantly, the 52 million members of IHG's Priority Club Rewards affinity program.

“Until 2007, Las Vegas was really independent of the rest of the hospitality industry and its distribution networks,” said Las Vegas Sands President & COO Mike Leven at a press conference announcing the agreement during this week's IHG Americas conference in Las Vegas at Leven's hotels. (Leven has a history with IHG, serving as president of Holiday Inn Worldwide during the 1990s.) “As an independent company with two properties in the U.S., we can't achieve the same level of reach by ourselves that we can under this agreement. This is the kind of help everyone in Las Vegas is going to need for a long time to come.”

While IHG Americas President Jim Abrahamson was quick to note the announcement isn't a launch of a new brand, the company is interested in affiliating other “well-established, high-quality independent resort properties around the world.” It's not, said Abrahamson, the beginning of an Autograph Collection-type soft brand.

It will be interesting to see if other Las Vegas casino resorts seek affiliations with hotel brand companies. Starwood had a foothold on the Strip when in 2003 it teamed with Planet Hollywood to rescue the failed reincarnation of the Aladdin Hotel. Earlier this year, Harrah's purchased the property and took over operations from Starwood. The Hilton name has a long history in Las Vegas. It owned the Flamingo from the early-1970s until 1998. And while Hilton no longer owns the property, the Las Vegas Hilton is a mega-casino hotel near the city's convention center.

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