When it came time to refresh Mandalay Bay’s all-suite tower, THEhotel, owner MGM Resorts International wanted to make a big splash. That’s why the company partnered with Morgans Hotel Group to bring its iconic South Beach brand, Delano, to the Las Vegas Strip. While THEhotel had a successful run, it lacked an identity, says Matthew Chilton, general manager of Delano Las Vegas. “We never did a brand awareness campaign for it; it just grew organically under the wings of Mandalay Bay.”
Chilton’s history with Mandalay Bay goes back to 1998, when he joined as hotel manager of the soon-to-open resort and casino. Holding several management positions over the years, Chilton saw the resort through the opening of Shark Reef Aquarium, Mandalay Bay Convention Center, and THEhotel. Prior to being named GM of Delano Las Vegas, he served as vice president of hotel operations and played a significant role in the resort’s overhaul. “To continue to reinvest in these properties is one of the keys for success for MGM Resorts,” Chilton says. “We’ve been very fortunate to receive a lot of that in the last two years at Mandalay Bay, with more to come.”
The $74 million remodel and rebranding of THEhotel into Delano Las Vegas was an important piece of Mandalay Bay’s property-wide renovation, which began in early 2013. The trendy, story-driven hotel provides a nice counterpoint to the 120-acre resort’s other offerings—it isn’t as casually luxurious as the Mandalay Bay towers and isn’t as traditional and upscale as the Four Seasons Hotel Las Vegas. Chilton says the Delano name should help attract more business from the East Coast, South America, and transatlantic markets. “It’s a great opportunity to introduce regional customers to the brand as well.”
The design draws on natural elements of the hotel’s desert surroundings and also weaves in elements of water and beaches to stay true to the original South Beach location. Local references include a 180,000-pound boulder from the Nevada desert that anchors the expansive stone entry. The guest suites feature Delano’s signature window sheers, white linens, and tufted headboards.
Construction on the 1,100-room luxury lifestyle hotel began in April 2014 and wrapped in September. The property stayed open throughout the project. Taking 100 rooms out of service at a time impacted the bottom line, but there was no real hard construction on the guestroom floors to disturb guests, Chilton says. The lobby demolition posed a bigger challenge. To minimize the effect on the guest experience, they beautified the space as much as possible. “We went a little more intense on the décor and put up temporary walls to create a gallery-like effect that began to tell our story of Delano.”
While some guests understood and expressed excitement about the rebranding, others felt caught off guard. Giving incentives for guests to come back when the project was complete helped smooth things over a bit. “That’s pretty typical with renovations or any major constructions that are happening while you still have the building open,” Chilton says.
Making a successful transition also required fusing the MGM Resorts and Morgans Hotel Group company cultures. As part of their orientation to the Delano brand, about 1,200 employees completed Morgans’s new-hire training to familiarize themselves with the core values and service principles of the company. Each hotel department also added unique identifiers to its standard operating procedures. Building a memorable narrative for the property was a vital step in the changeover. Chefs, mixologists, and other F&B leaders went to South Beach to conduct research and glean ideas for playful, authentic concepts that would tell a story and reverberate in the Vegas market.
Their research has paid off, with the property seeing a big uptick from its new food and beverage outlets, which include the Franklin lobby bar, 3940 Coffee and Tea, and Della’s Kitchen. “Those are seeing significant increases, some of that being driven by all the things we’re doing to promote, so it’s just busier,” Chilton said. “We are seeing an uptick in the ADR as well, and it’s all been positive thus far.”
As with all major rebranding projects, there are bound to be missteps. In the case of the Delano, the new guestroom pillows were too firm. “We had a spec that didn’t go the right way, and we’re fixing it,” Chilton says. Once the pillows are flipped out, the hotel plans to make a celebratory announcement and remain transparent with guests.
Since its Sept. 2 debut, the Delano jumped from No. 134 to 32 out of 272 Vegas hotels on TripAdvisor. Chilton says MGM will assemble focus groups early next year to determine what’s resonating the most and where Delano can improve. “It takes a while to accentuate an established brand in this market, so we just need to keep our pulse on that. That’s what we’re focused on doing as a long-term strategy.”