Wednesday, February 10, 2010

Ritz-Carlton Luxury Hotel & Resort Las Vegas Shutting, the Victim of Four Names

The Ritz-Carlton hotel company, a division of Marriott, said today that its luxury resort, in Henderson, Nevada, would shut for good on May 2.

The Las Vegas Ritz, as the property was often called, was the victim of the terrible economy, and perhaps also of a location that is 17 miles from the Las Vegas Strip. But it was also the victim of four terms associated with it: Las Vegas. Resort. Luxury. And, uniquely, Ritz.

Not long after the financial collapse, when many corporations were responding to public outcry and pulling meetings and other events out of high-profile luxury hotels, I was speaking with J.W. Marriott Jr., a true gentleman who runs the Marriott hotel company build by his parents.

Marriott's top luxury brand is Ritz-Carlton. Along with Four Seasons and other top-level brands, Ritz-Carlton was really taking it in the chin, after years of great prosperity and growth. The economy obviously was the main driver, but at the brand-name luxury level, hotels were being socked because companies were afraid to be seen booking at five-star hotels and resorts -- thanks, in part, to the scandal involving the giant AIG insurance company, which brazenly went ahead with a fancy corporate retreat at a Southern California resort a mere week after Congress had approved an $85 billion taxpayer bailout of the corporation.

At the time, Bill Marriott was fretting about how to avoid big layoffs among the highly trained Ritz Carlton workforce -- the backbone of its top-shelf service reputation. All luxury hotel companies, he said, were facing the same dilemma.

"But you have one extra problem, Bill," I said.

"What's that?" he asked.

"If I stay at a Ritz-Carlton, I have to put the word "ritz" on my expense account and get it approved."

"I know," he said ruefully. "As in ritzy, puttin' on the ritz ..."

The "optics" had turned against Ritz, arguably the best-run luxury hotel chain in the world, partly because its name is synonymous with luxury.

In the case of the Las Vegas property, the optics again were unfavorable. All over the country, resort hotels have been removing the word "resort" from their titles, but Las Vegas (a town I like quite a bit) is not also good for the optics. Sounds like too much fun, it seems. Las Vegas's hospitality business in general has been staggered in the last year and a half.

Sorry to see a good hotel get a bad deal like this, but such are the times.


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