The New Road Starts Here

The best symbol of the slow-but-significant change taking place in Las Vegas isn’t on the 23rd floor of the Ogden on Sixth Street, or even in the SuperNAPs at Switch’s Data Center on South Decatur Boulevard. It’s in an unassuming warehouse in the shadow of Panorama Towers on West Harmon Avenue.

That’s where Ultimate Gaming, a subsidiary of Fertitta Interactive, is setting up its new headquarters. Even before live cash games start online, it’s a major operation, with top executives, marketers, creatives and members of the company’s software-development team moving in. And despite the generic look of the exterior, there will be no mistaking what business the building’s denizens are in: The larger of two conference rooms is called the Big Blind, and a recreation area will feature, in addition to billiards and pingpong tables, a regulation-size poker setup.

“It’s a big investment in building and staffing up,” says Ultimate Gaming’s chief technology officer Chris Derossi. The operation, which now has about two dozen Las Vegas employees, is looking to add more than 100 jobs over the next several months.

The 20,000-square-foot converted warehouse’s history is just as interesting as its future. Before the new tenants started moving in, the building was the design center for the Cosmopolitan. The long, high-ceilinged expanse that is being reconfigured to host a few dozen work stations used to host mock-ups of the Strip’s last mega-resort’s rooms: The very space where customer-service representatives will soon walk online poker players through registration was filled with designers poring over Wraparound Terrace Suites and City Rooms.

The repurposing of that work area is a dramatic statement about where Las Vegas is headed. This used to be the proving ground for one of those elegantly designed machines that line the Strip, intricately balanced to put heads in beds and cash in the till. Those are the engines that powered the Southern Nevada economy for the past half-century, creating the tourism industry that, even after four years of suspended animation, still accounts for nearly half the jobs in the region.

And yet it’s impossible to ignore the last four years. There’s no denying that people still love Las Vegas; about 40 million of them—a likely record—will visit the Valley this year. But they aren’t spending the way they used to, and resorts have become much leaner, shedding about 12,000 jobs since their prerecession high.

To get those jobs back, Las Vegas would have to add three or four major resorts—about 10,000 hotel rooms. And with occupancy rates still lagging, that’s not happening soon.

Hence the urgency in trying to reinvent Las Vegas as TechTown, USA. Tony Hsieh and his fellow silicon avatars are building something that’s distinct from the hospitality industry. What’s happening on West Harmon, on the other hand, is a hybridization of Las Vegas’ traditional strengths and its tech future.

Online poker involves more than slapping an off-the-shelf software package onto a casino’s existing website; it means the creation, development, testing and continuous improvement of a system that combines entertainment with e-commerce. These techies are as authentic as the ones found in any San Francisco walk-up. Derossi, for one, has impeccable tech credentials: A self-described “geek from birth,” he grew up watching his U.S. Air Force physicist father working at Vandenberg Air Force Base before launching a career that took him from Apple—where he was chief architect for the Macintosh operating system in the early 1990s—to his own online poker provider, CyberArts, which Fertitta Interactive bought in 2011.

What makes the Ultimate Gaming HQ’s location even more appropriate is that, a few years ago, its parcel was going to be part of Viva—Station Casinos’ planned behemoth off-Strip resort development that would have transformed much of the region between Harmon and Tropicana west of Interstate 15. The economy scotched those plans, but the convergence of tech and gambling savvy—particularly if federal legislation clears the way for Nevada companies to offer poker across state lines—may soon make the industrial zone a hotbed of economic development.