Rick Mazer: Doubling Down
Rick Mazer, the regional vice president for Harrah’s Entertainment’s Horseshoe properties in Hammond and Elizabeth, Ind., has been at the Hammond property through three owners. He opened the casino on its original boat as general manager of what was then Empress III in 1996, held the position when Jack Binion bought the property and rebranded it as Horseshoe, and has remained under the stewardship of Harrah’s Entertainment. In late July, Horseshoe Hammond closed the original boat, with its 43,000 square feet of gaming space spread over four decks, and moved onto a new $475 million barge with 108,000 square feet of gaming space, a high-tech theater/banquet and meeting facility called The Venue, and expanded restaurant space with panoramic views over Lake Michigan. Mazer spoke with Casino Journal contributing writer John Grochowski about the opportunities and challenges of operating the new casino property in the Chicago market.
When you opened Empress III in 1996, could you have imagined a facility like this in the Chicago market?
I always envisioned that this market had the opportunity to really develop itself. It such a deeply populated area and has such a diverse economy. When we first opened, we thought we had a big beautiful property then. We only realized later that it wasn’t really even close. We opened with three levels on the existing vessel. We added the fourth level because of demand. Even upon that, we had tremendous capacity issues. When Jack (Binion) came in and bought us, we envisioned a product similar to this, way back in 2000, and started working on designs for what was then affectionately known as the MOAB, for “mother of all boats.” When Harrah’s first took over, they showed interest, we re-opened the plans, we continued to work on the case model for justifying the capital expense. When we went to present it, their response was, “Was it possible to put the casino on one level instead of two, and make it that much larger of a parcel?” We went back, redesigned it to be one level, then realized we could still put a second level on, and wouldn’t it be nice to have a first-class buffet and have an entertainment center, and something else besides just a casino product.
Given that there’s nothing like this in the Chicago market, did Harrah’s ever show any hesitation and ask, “Do we really want to spend $475 million here?”
Well, if I were to sit down and look at the model today, I don’t know I would have the same answer as I did three years ago. The capital markets have changed so dramatically. Back then, what we realized was this is a huge gaming market in the sense that people like to gamble here. It’s the second largest feeder to Las Vegas, Chicago is. All the product that existed here was mediocre at best, and poor in some cases, in that there was no real authentic casino product here. So the approach was, doesn’t Chicago deserve that kind of product, and wouldn’t it go over very well? And I believed it would go over VERY well.
I think it’ll dramatically grow the market, and we’ve always said that. We know there are customers who visit our Las Vegas properties who have told us they do not go to the riverboats because they don’t like the product. It’s not a casino experience to them, so they would just as soon get on an airplane go to Las Vegas where they can get an experience that makes sense to them. By building that experience here, we now get that customer to decide to visit on the local level as well, and we can get incremental visits out of that customer. Some of those exact customers have been here and said, “Now we have a Las Vegas experience here.”
The Venue, which seats up to 2,500, is the first real show facility in the market. What does it do for you?
It is truly a venue, which is why we call it The Venue. It is a theater facility at times, it is a banquet facility at times, it can be a hall at times. It’s a very flexible space. It’s typical theater seating, tiered seating, comfortable fabric seats, but it’s special seating in that not only does the seat fold up, but the entire seat back folds down. As such the entire tiered section actually collapses like a bleacher and folds within a wall. Another aspect we added is a sky box, or a VIP box similar to what you would see at a sporting facility, in the loge level. They are designed to have food and beverage capability. There’s not a whole lot we can’t handle. One of the goals was to put a system in that became very appealing for artists to be able to use and not bring as much of their own, or have to unload their own equipment, and be able to use our equipment. That makes for a friendlier environment for them, quicker load in and load out for us and an easier ability to turn the room. We opened up with the fabulous Bette Midler; she was absolutely phenomenal. We followed with Smashing Pumpkins, and right there was an example of how we can appeal to different segments with different entertainment.
With the new facility, did you invest in new gaming equipment?
Of the 3,200 slots, 2,000 of them are new. We did bring 1,200 over. A lot of those were still fairly new even on the old vessel. One of the things we didn’t want to do was have that vessel deteriorate as we were building this. A lot of the slot product is really brand-new slot product that doesn’t exist in this market anywhere, and probably if ordered today, you wouldn’t get for six or seven months. In addition, the floor enables to bring in things with a large footprint that would normally not go onto the riverboat because of the size constraints. So we have a couple of brand products, [IGT’s] eBay for instance, which takes up a large footprint. By doubling the number of table games, it allowed us to do some things that previously we were constrained to do, such as to bring in Blackjack Switch and Let It Ride and some other games that are popular, but we had so much demand for traditional blackjack and traditional craps and roulette that it was tough for us to think about switching out games.
We still own the World Series of Poker as a company, and Horseshoe created the World Series of Poker. It is something that is very close and dear to our hearts. Look at ceiling fixtures, they’re something a little more modern than you would have seen in a poker room 50 years ago, but the feel is not that different. A lot of dark woods, up-light fixtures. It was important in that we wanted a very, very traditional feeling poker room, and we wanted something that was of a caliber that doesn’t exist in the Midwest. We have tiered it such that we have a very large general floor, we have an upper level that is behind some glass that is for some bigger limit games and then we have Benny’s Backroom, which is truly for customers who want a very private game. In October, we will have our first World Series of Poker Circuit event. The best part is our use of The Venue. Because it’s still on the boat, we can retract the seats and add tables. We’ll be putting 75 tables up there to hold the tournaments without having to close our existing poker room.
You have a number of special rooms. Tell me about the Asian games room.
That is a very, very special room. All of the wood in there is all hand-carved from China. Even the beautiful dragon pictures of the dragon catching the fireball, was a block of wood that was all hand-carved. It’s gorgeous. We were able to give a very strong and loyal customer base in our Asian customer a space that would send a message that we appreciate their business and we appreciate their culture.
How do you see the future of the market?
Most markets right now are struggling - not just gambling but other industries as well - as we’ve seen rocketing prices at the gas tank, increased prices in our grocery stores. But I still believe there’s a lot of upside potential in an underserved market in Chicago. It has a great gaming capacity, lots of people, is a world attraction - might truly be if it gets the Olympics in 2016. And I think the growth is there not only for us but also our competitors once we get out of this cycle we’re in from a macroeconomic standpoint.