‘It’s All Anybody Is Talking About in Las Vegas’

Friday June 3rd, 2016

Andy Abboud is the vice president for government relations and community development at Las Vegas Sands Corporation, billionaire Sheldon Adelson’s 28-year-old casino and resort company. Abboud has taken the lead in the Sands’ and Majestic Realty’s $150 million interest in a new stadium for Las Vegas, and potentially a new home for the Raiders, who are currently in deadlocked negotiations with the city of Oakland over stadium financing. In late April, Raiders owner Mark Davis attended the Southern Nevada Tourism Infrastructure Committee at UNLV and pledged $500 million to help build a stadium should the committee recommend such a plan to the governor.

KLEMKO: Tell me how this all started. When did you first get the idea the Raiders might move to Las Vegas?

ABBOUD: Two or three years ago we heard the Raiders were looking for an opportunity to move. Napoleon McCallum, who played for the Raiders and works in my department, had a conversation with Mark Davis, and he kind of mentioned it to me casually. He said, “I was at a game and Mark said he’d be interested in moving to Las Vegas.” I said, “Okay, well let him know we’d like to talk.” Fast forward to the 2015 state legislative session, and there was a lot of discussion about the right use for room tax dollars. The room tax is typically dedicated to driving visitation to the city. There was some discussion that it should go to the expansion of the convention center. While we supported the remodel, we really felt it was time to look at a different dynamic. We saw a stadium as not only the best way to attract an NFL team, but also a new home for UNLV and for concerts. We kept in touch with the Raiders and started kicking around the idea of a stadium, and then when L.A. fell through for them, we felt we could have open discussions with the Raiders.

KLEMKO: The Raiders have long flirted with other markets, notably San Antonio, as a destination for a move. And many of us in the media dismiss those flirtations as ploys for Mark Davis to get what he wants out of the city of Oakland. How were you convinced this was real and something deserving of your time and effort?

ABBOUD: With Mark Davis coming to the tourism meeting and doing the interviews this spring. If you go onto the website, we released a video about their commitment to the community, and knowing that the Davis family has always had an interest in moving the team to Las Vegas. Mark told me he bought the Las Vegas Raiders website in 1999.

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KLEMKO: And the next step was gauging public support.

ABBOUD: Right. We launched the campaign. We hadn’t really done this before despite building things all over the world. We wanted to see what the community support would be, though we knew it would be strong. We were more apprehensive about how the NFL would react. And the NFL reaction was, quite frankly, more positive or neutral than we ever anticipated. So in the last three or four months it’s just picked up an incredible amount of momentum. It’s all anybody is talking about in Las Vegas. Everyone is so excited. This has been one of the most exciting things for the community since they won a national championship in basketball in 1990. They’re rallying around it and it’s exciting to see everybody talking about the same thing. People bring it up to me wherever I go. I usually wear Nebraska gear to the gym, but if I wear Raiders gear to the gym, I probably have 25 people come up and talk to me and say do you think it’s going to happen? They don’t even know I’ve been working on it.

KLEMKO: As you start gathering support in the political realm, what concerns do people have?

ABBOUD: We talked to elected officials about all the economic benefits, how it can be financed, how we think it can work. People wanted to know if the Raiders were for real, if they were really committed to this. I think from an industry perspective, people around Las Vegas were more than anxious to have the opportunity to explain why Las Vegas is a safe atmosphere for pro sports, because as opposed to the rest of the country, we have legalized, regulated sports betting. Our view is that it’s always better in the environment where it’s regulated as opposed to the environment where it’s not regulated. We wanted to make that case, and I think the NFL is not concerned about it. They know this is a city of 2.2 million people and there’s a unique opportunity here.

KLEMKO: Two polls have tried to take the temperature of those 2.2 million folks, and they essentially said opposite things. A poll commissioned by the Sands came out in favor of a stadium, and a poll commissioned by MGM came out heavily against a stadium and in favor of a convention center. [Editor’s note: The MGM declined to release the wording of their poll, while the Sands did so.] What gives?

ABBOUD: Local politics. I think that, to be perfectly blunt, MGM wanted to make sure that we were going to cooperate with the expansion of the convention center, and we wanted their support for the stadium. I don’t want to squabble with them, but if you believe in your poll and your poll is real, you release the whole poll. If your poll is cooked, you don’t. I was a little bit embarrassed for them that they would perpetuate the notion that people sitting around in the suburbs of Las Vegas and Henderson and Boulder City are sitting around on Sunday afternoons saying, “I wish we had a bigger convention center.” I think it was an embarrassing ploy. All you have to do is go have a cup of coffee, go to dinner, or go to your doctor’s office and the Raiders are all anyone is talking about.

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KLEMKO: Have you taken the temperature of owners to see what kind of support there would be in a closed-door session if this comes to a vote?

ABBOUD: We’ve done a little fact-finding. It’s been tangential because we need to be respectful of the NFL process, and because we don’t own a team and we don’t have the financing yet, we don’t want to be disruptive. We think there’s some strong support, but we don’t want to put the cart in front of the horse. We want to get the stadium financing first so the Raiders can actually file their application and determine what the best strategy is to talk to the owners. That is a very tight, eclectic group and our view is that’s a peer-to-peer lobbying effort. We will be as helpful as we need to be or stay away as far as we need to. Hopefully what comes out of the last infrastructure meeting in July is that we go into the special session and allocate room tax dollars for the stadium.

KLEMKO: The Rams were successful in rallying owners to the idea of a team in Inglewood, despite considerable feeling that Chargers owner Dean Spanos was next in line. Have you consulted with them for advice on how to get this thing done?

ABBOUD: We’re looking at that. One of the advantages you have in having a company like Las Vegas Sands looking at something like this is that we’ve built 70 million square feet of buildings around the world from Las Vegas to Bethlehem, Pennsylvania to Singapore. When you’re building large properties like that, and you’re bringing gaming into a community that didn’t otherwise have it, you know you have to be very sensitive to your constituencies and build the support you need. This can’t be ramrodded. So we’ll talk not only to the Rams folks, but also to everyone with a level of expertise as to how to handle this. That said, we defer to Mark Davis. We’re the house, not the owners.

KLEMKO: It’s been suggested by ex-players and members of the media that a team would have to take special care in acquiring talent to a Las Vegas team given the temptations present, which might create a competitive disadvantage. Do you give any credence to that?

ABBOUD: There are casinos and nightclubs all across America. The longer someone spends in Las Vegas, the less interesting it becomes. So I think it’s an overstated notion. People who live in L.A. don’t go to Disneyland and Hollywood everyday. People who live in D.C. don’t hang out at the Mall. People who live in Vegas don’t hang out at the Strip all day. Once you’re engraved in the fabric of the community, the strip is a small part of your life. There’s as much fun and temptation in Miami and New York and Philadelphia as there is in Las Vegas.

KLEMKO: The infrastructure committee is comprised of representatives from all the major casino groups, including the MGM, yet the Sands is the only group having committed money to the stadium plan. Is there any concern that other casinos that aren’t cut into the deal will influence the committee against a positive recommendation?

ABBOUD: People need to understand that it wasn’t a matter of people being cut in or cut out. What was made very clear in the recent infrastructure committee meeting is that this is not a slam-dunk. We are assuming all of the risk. So if it loses money, if there are cost overruns, we are assuming that risk. This isn’t something where we throw in $150 million and then rush off to the bank. For a gaming company like ours, the margins of a stadium are very small. Sheldon Adelson wants this as a legacy, to be able to contribute something to the community. So the advantage of having Las Vegas Sands in this particular deal, even though there’s a significant amount of public funding, is that Mr. Adelson and Majestic Realty take away the risk to the taxpayers. So unlike any other community in America, the local taxpayers basically pay nothing for the stadium. If for some reason the stadium didn’t do well, there’s no liability to local taxpayers because private investors are taking the risk. So we’re certainly open to other people becoming a part of the deal, but we launched it and we’re on a very short timeline. It’s very much a work in progress. As we secure the public financing, we’ll continue to explore other opportunities with other investors.

KLEMKO: I think people imagine the Las Vegas casinos are printing money, but profits have leveled off here in the last six or seven years. What do you imagine the season-ticket holder base will look like for a Las Vegas team?

ABBOUD: We’re studying all that right now. Again, this is all new to us. As we look at that particular fan segment, we just have to compare ourselves to similar size markets. We’re setting realistic goals. We don’t think it’s going to be an outrageous sum of money; we won’t be charging what they will in L.A. or in San Francisco. We’ll charge the appropriate price for the Las Vegas market. The caveat to that is: what’s more important to us, and what is unique to Las Vegas, is that we are also concerned with the amount of visitors to neutral site college football games, concerts, combative sports, automotive shows. That outside visitation is where we really see the opportunity. We believe a rising tide lifts all boats; we all work together to bring people to town and then we fight over where they stay when they get here.

• Question? Comment? Let us know at talkback@themmqb.com

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