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Desert Rock Enterprises Raises Ownership of Golden Gate, Las Vegas to 60%,
Derek Stevens Approved to Become Chief Operating Officer

By Arnold M. Knightly, Las Vegas Review-JournalMcClatchy-Tribune Regional News

Sep. 26, 2009--Derek Stevens has made the trip from Michigan auto-parts manufacturer to Las Vegas 51s baseball team owner and executive.

Now add gaming executive to his resume.

Casino regulators recently approved a plan for Stevens to become chief executive officer of the historic Golden Gate downtown.

The move coincides with Stevens' investment firm, Desert Rock Enterprises, raising its ownership stake in the property to 60 percent from 50 percent.

Mark Brandenburg, who has been an owner of Golden Gate since 1990, owns the remaining 40 percent and is at the property daily as president.

Stevens, who also owns a nearly 15 percent passive stake in Riviera Holdings Corp., said the investment in Golden Gate enables him to get into the operational side of the casino business.

"You only really have an opportunity to (own and operate a Las Vegas casino) at a certain level," Stevens said. "For me, who I partner with was critical because I wanted to make sure it was someone that had a background that I could learn from and trust and be able to work with on a going-forward basis."

Stevens seems to be a throwback to past casino owners who could be found on the casino floor interacting with customers. On Tuesday, he interrupted an interview with a reporter to stop a couple that was carrying a bottle of champagne in a bucket of ice and heading toward the hotel's elevator.

Upon discovering the couple was celebrating the wife's graduation from medical school a few days earlier, Stevens offered his congratulations and his business card.

"I'm one of the owners here," Stevens said. "I see you pulling out the champagne and I just want you to enjoy yourself."

Brandenburg said the partnership gave him something he needed -- the capital to upgrade the property in a way he had been unable to do on his own.

During the past 18 months, the 103-year-old Golden Gate has been busy with renovations, including adding a player-tracking system, upgrading the 15 table games and 270-slot machine floor, remodeling the 106 hotel rooms and adding more televisions throughout the casino and bar area.

"It has all really changed the feel of the place," Brandenburg, whose family has had various ownership roles at the property since 1955, said. "When we did our slot floor and put in new slot machines, that in itself, particularly for a small business like us, is a huge investment."

The latest upgrade is the new One Bar, which opened Sept. 18. It is the first permanent outside bar on Fremont Street.

The slush and beer bar is powered by a geothermal system designed by Derek Stevens' brother, co-investor Greg Stevens, who has an engineering background.

Technology powering the bar allows it to serve what Derek Stevens claims is the coldest beer in town even when outside temperatures hit 110 degrees.

The partnership between Brandenburg and Stevens began when the Stevens brothers walked into the property in 2007 wearing T-shirts, shorts and flip-flops and asked to see the owner.

"We were interested in getting into the casino business," Derek Stevens said. "We were interested in doing it with another family-business owner. One thing led to another and Mark and I got along pretty well right from the outset."

The initial meeting lasted 30 minutes and Stevens said he returned the next day wearing a suit for a follow-up meeting. Casino regulators approved a 50 percent sale of the property to Stevens in March 2008. The stake was raised this month when a loan to the property made by Stevens was converted to equity.

"It was really one of those things where all the stars aligned," Stevens said. "We quickly realized that maybe there was some benefit in trying to partner up together."

Contact reporter Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3893.

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Copyright (c) 2009, Las Vegas Review-Journal

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