Kaos nightclub closed effective immediately

Can't say I'm too surprised. It was definitely an awesome dayclub the one time I went there. Prices weren't any more than everywhere else. Awesome layout. But they did have a lot of competition.
All the clubs are feeling the cold now. I just came back yesterday and my friends and I looked into XS for bottle service (they wanted to see Diplo). I hit up a few hosts a few days to a week before and they all said the same typical price (minimum $1500). I waited, and hit up the main host the night of and he said minimum 1k for 8 people, lol. $180 per person for no line, two bottles, great table. They were desperate to fill tables. I saw another table one have one bottle of... Jameson, I think it was.

 

Damn, I wonder what the total cost of the renovation and opening was, and how much money they were losing. That was brutal.

 

https://lasvegasweekly.com/nightlife/2019/jan/24/palms-kaos-dayclub-nightclub-opening/#/0

 

$690 million.

 

Very interesting article. I wonder if that investment cost someone their job.

Unrelated question: I assume the covered winter day pool will still operate as a covered winter day pool correct? Even if they don't have any fancy DJ's, maybe they will still have some music? Anyone have any thoughts / knowledge regarding this?

 

1k tables... welcome to the winter time haha. The only place that gets full price right now consistently is Lavo Party Brunch.

 

No. It will operate only if its rented out for a private event.

 

With those prices, it makes the Bunny Ranch look cheap.... LOL!

 

The most frustrating part is how self-inflicted this was. It's an awesome venue that was always very busy, but they were dramatically overspending on their performers. The Marshmello contract was $60mm. Cardi B was getting $300k per appearance, with a 15-minute minimum.

In addition, they really screwed their employees. That letter that's posted above went out on Tuesday afternoon, after scheduling sent out call sheets for the week that morning. Everyone figured that given all the money they'd put into building the dome, and the positive buzz around Halloween, meant that they'd get at least a few more months. The people I know who work(ed) there were pretty surprised.

Multiple very senior people have left the company.

To be fair, gambling is no longer bread-and-butter for Vegas. At most places it's only about 40% of their revenue. There is a lot more money in clubs, restaurants, and shopping, than there is in a casino floor.

 

Actually it is the other way around. Entertainment (i.e. Clubs primarily marketed to Millenials, shows, high end rooms, restaurants etc) is now where Vegas's growth comes from. Gaming is actually less than 35% of total Las Vegas revenue and is dropping every year (it has consistently dropped as a percentage for the last few decades). The issue is that gaming is now everywhere, Asian and European and australian high rollers stay in their respective countries. People, especially retirees, who just love to gamble go to their locals which are available in more and more states.

Vegas only chance to stay alive and grow is to start marketing itself as an entertainment destination, as opposed to a gambling destination.

 

While I agree that gambling is everywhere, there are several to choose from here in the Chicagoland area, Vegas has always been an entertainment destination, i.e., The Rat Pack, Elvis, ect. What they need to market is what made Vegas Vegas as opposed to going to your local casino. Cheap rooms, cheap eats, lots of free drinks, good odds, loose slots, decent BJ... Back in the 90's, they tried to turn Vegas into Disneyland. That didn't work. It's true that Millenials are part now of Vegas' growth, and will be in the future, but why give up so readily on Gen Xer's like myself?

 

To be fair, I did say that the gamblers WERE the casinos bread & butter for years.Yes, there IS a lot of $$$ ''in clubs, restaurants, and shopping'', but that TOO is a gamble, as the closing of KAOS proves

 

I definitely agree. They would be foolish to give up on any market segment, especially one that still makes up a third of revenue. Treating gamblers poorly and cutting comps is a terrible strategy for Vegas and I have often said that on here.

What I am saying is that they cannot simply market Vegas on the "Cheap rooms, cheap eats, lots of free drinks, good odds, loose slots, decent BJ" because that is something any local can match. And the locals will easily beat them at that game since they have lower overhead, lower costs, etc.

Instead, Vegas has to do exactly what they did so well in the past, market their entertainment talent as you said, the rat pack and the Elvis equivalent today. That is what they are trying, sometimes they hit big (Cosmo's Marquee club had, for a couple years, actually beat out the entire casino in profits) and sometimes they face plant (like palms just did). The musical acts, cirque du soliel have all done well in that regard. Combine that by attracting gamblers with decent comps and the combination cannot be beaten, for any age group.

 

Yep, the whole "fine dining" thing is a huge draw for Vegas. If you're in a big city like NYC, Chicago, or LA, then there are plenty of great options (though there's no substitute for the fountain view), but, no disrespect to smaller towns, but a lot of places just do not have restaurants like Vegas does. If they focused solely on gambling, they'd lose share to local casinos. They've also created new markets by offering entertainment options -- I can't tell you how many people I know who come to Vegas for the sole purpose of going clubbing. A friend of mine was here for a week and gambled exactly $3.00, but spent a ton on food. It's senseless to completely give up on gambling (which they haven't done and likely won't do), but a diverse array of offerings is what makes Vegas unique compared to Harrah's Northern California.

Honestly, I think the problem Palms had was execution, not content. The location certainly didn't help them, but plenty of clubs have remained popular even if they're no longer the newest place in town with the biggest-name performers.

 

Ohhhh here we go again... what Vegas needs to do is what worked in 1958, bring back Benny (Binion) and Jackie (Gaughan)... they knew how to run a joint! And bring back the mob... they treated their customers well... dig up Dean and Frank, stuff 'em and put 'em on a stage to their hits playing in the background, hell...no more with these fancy, over-priced DJ's! Blah, blah, blah...

Las Vegas isn't dying, not even close. Stations got out over their skies on this one. KAOS is the gift that's gonna hurt for awhile, as cancelling many of the contracts is gonna be expensive. Not to mention figuring out how best to utilize the beautiful facility going forward..

I don't believe remaking Vegas is needed, simply because Stations got a little crazy. I honestly don't know why these corporations like CET, MGM and Stations pay their top staff the money they do to come up with ideas... clearly not all are winners... they just need to go back to given a guy a square deal on the gaming, free rooms, $2.99 buffets and have Jerry Lewis run through the property yelling "HEY LAAAAADY" once in awhile and people will flock to Vegas... Oh wait... people already are flocking to Vegas! Never mind...

 

Related article from today’s RJ...

https://www.reviewjournal.com/business/casinos-gaming/kaos-closure-may-signal-challenges-for-las-vegas-club-scene-1887528/

 

Interesting.

 

agree 100%.
As someone joked before, Station could have used that amount of money to buy the Cosmo.
Instead they were trying to turn a run-down off-strip place into a Cosmo. What a foolish idea.
Palms' old days will never return. It is now more than ever a local joint.

 

Have to call bullshit on the article. The club scene is only getting bigger on the strip. Kaos failed because no one was staying at the property. They would stay on the strip, spend their money there then simply take a cab or uber over to Kaos for the dayclub or nightclub and go right back to their hotel. Pulling marshmello away from Xs and practically outbidding themselves was dumb as shit too. To fail with marshmello, skrillex, cardi b and armin van buuren is really saying something...
Even venues who dont have major acts are still pulling in major revenue. 1OAK and Tao dont have big names anymore but the places are still packed every night

 

I agree with the overall article being BS, but "nobody staying at the property" was the least of their concerns. Their restaurants get great traffic, nightclubs have an insane markup for tables and bottle service, and the resort itself does well. And when Kaos was open, they had pretty fantastic attendance. They just spent way too much money on talent and the physical space. After all, Drai's has a 2500-person capacity, whereas Cromwell has less than 200 rooms.