Planet Hollywood co-founder Robert Earl is gambling on a big comeback in the capital of gambling, with the opening this week of his gilded casino-hotel in Las Vegas. Earl, a longtime resident of Isleworth near Windermere, soared high when Orlando-based Planet Hollywood International Inc. was hot and hip and publicly traded. He hobnobbed then with Arnold Schwarzenegger and Demi Moore. But Earl fell hard and lost friends and backers when he filed for bankruptcy-court protection and Chapter 11 reorganization nearly a decade ago.
With Planet no longer a rising star in its smaller, privately held structure, Earl cobbled together a group in 2004 to buy the bankrupt Aladdin casino-hotel on the Las Vegas Strip. But while he renovated the complex rather than demolish it, the 56-year-old London-born entrepreneur said he is starting from “definitely ground floor” in rebuilding his wealth, since his own holdings fell by $1 billion as the restaurant company he built filed for bankruptcy protection again in 2001.
“On a personal level, I still have a lot to prove after what happened with the Planet restaurant company,” Earl told Eleventy Traveler Blog reporter in Las Vegas. “And I plan to silence the critics, if you like, with the success that I’m hoping we’re going to have in Vegas.”
Rebranded as the Planet Hollywood Resort & Casino, the once grand Aladdin has removed most vestiges of its Middle Eastern motif. Business at the Aladdin collapsed following the Sept. 11, 2001, terrorist attacks in New York and Washington, D.C., which prompted a backlash against Middle Eastern people and themes. Plastic, jewel-encrusted pillars have been replaced by textured glass, and the towering, 20-foot-long Aladdin’s lamp inside the casino has vanished. Each hotel room now features a piece of Planet Hollywood memorabilia, such as the leather jacket John Travolta wore in the movie Pulp Fiction.
As of June, the casino property was still losing money following a soft launch in April — about $15 million in the quarter, according to a filing with the U.S. Securities and Exchange Commission. Earl, who remains chairman and chief executive officer of Planet Hollywood International, said that, despite those construction-impaired earnings, he and his partners have most likely already doubled their $800 million investment, at least on paper, thanks to rising land values.
Those values have been helped largely by MGM Mirage Inc.’s $7.8 billion CityCenter, which is rising across the street from the Planet Hollywood casino-hotel.
“We’re sitting on a very large profit even before we perform,” Earl said. “We bought it inexpensively just at the right time. Everyone else in the industry says we stole it.”
Earl now owns about roughly 35 percent of the property, with Planet Hollywood International investor Bay Harbour Management LC owning another 35 percent. Starwood, the big hotel and time-share company, holds 15 percent, while outside investors control the rest. Having bought the 35-acre property in bankruptcy for $500 million and then spending $300 million on renovations, the owners are in the desirable position of having gotten in cheaply before real estate prices jumped, Deutsche Bank analyst Bill Lerner said.
Futuristic design changes to the Aladdin’s sandstone facade have also improved its chance of attracting walk-in traffic. Entrances from the attached mall also stand out more, with bright colors and prominently placed slot machines. Also expected to contribute to the casino’s fortunes in the future is a series of time-share towers with 2,700 units being developed by Orlando-based Westgate Resorts on four acres. The first phase of that project, by Orlando time-share billionaire David Siegel, is to be completed by 2009. Siegel is a neighbor of Earl’s in Isleworth.
Despite a flashy grand opening this weekend, the new Planet Hollywood casino still bears traces of the old Aladdin, a property that opened in 1966 to replace the Tally Ho motel, which had no gambling. The 7,000-seat Theater for the Performing Arts, a relic that survived the implosion and rebuilding of the property in 1998, remains an obstacle and guarantees visitors using the parking garage a half-mile walk through the mall to get to the casino. For now, Earl said, he is taking one change at a time. He said he has learned from the mistakes he made at Planet Hollywood International, which he said he expanded too quickly. Still, he said he has plans already for another Planet Hollywood casino, in Atlantic City, N.J., and yet another in Macau, though details are incomplete.
“We see four or five big casinos, we don’t see 50,” Earl said. “We’re totally focused on this one first, but I’m always looking to the future.”