Casino, auto, movie mogul

Kerko­rian shaped the new Las Ve­gas, build­ing mega-re­sorts

Los Angeles Times - - FRONT PAGE - By David Colker and David Stre­it­feld

No ho­tel in Las Ve­gas is named for Kirk Kerko­rian. He’s not known for any ground-break­ing in­no­va­tion in the au­to­mo­bile in­dus­try, and he regularly turned down in­vi­ta­tions to high-pro­file Hol­ly­wood events — even the Academy Awards.

But Kerko­rian, an eighth-grade dropout who for a time was the rich­est per­son in Los An­ge­les, shook up the casino, auto and movie in­dus­tries in turn, mak­ing a for­tune not by fo­cus­ing on a sin­gle en­deavor, but by buy­ing, selling and buy­ing again.

He bought MGM Stu­dios three times, al­ways to his ben­e­fit if not the stu­dio’s. He ac­cu­mu­lated a siz­able chunk of Chrysler Corp when it was vul­ner­a­ble in the 1980s and did the same with Gen­eral Mo­tors in 2005.

And Kerko­rian in­stinc­tively sensed the prom­ise of Las Ve­gas on his first vis­its im­me­di­ately af­ter World War II. He built what was billed as the world’s largest ho­tel not once but three times, and ac­quired many of the city’s most fa­mous prop­er­ties, in­clud­ing the Bel­la­gio and the Mi­rage.

“I’ve had more peo­ple tell me, did you en­vi­sion this or that?” Kerko­rian told The Times in a rare in­ter­view in 2005. “I just lucked into things. I used to think that if I made $50,000 I’d be the hap­pi­est guy in the world.”

Kerko­rian, 98, who amassed a per­son-

al for­tune es­ti­mated at $18 bil­lion at one point, died Mon­day at his Bev­erly Hills home. An­thony Man­de­kic, chief ex­ec­u­tive of Kerko­rian’s com­pany, Tracinda Corp., said the death was due to age-re­lated causes.

Kerko­rian was not a recluse — he at­tended events he par­tic­u­larly en­joyed, in­clud­ing pro­fes­sional ten­nis matches — but he didn’t seek the lime­light. He had no per­sonal pub­li­cist, didn’t leak his strat­egy to the media and worked out of what was char­ac­ter­ized as a charm­less Bev­erly Hills of­fice. He didn’t use a chauf­feur and fa­mously drove un­flashy cars — a Pon­tiac Fire­bird, a Jeep Grand Cherokee

When he wasn’t mak­ing deals, his great joys were play­ing ten­nis with friends and in se­niors com­pe­ti­tions, and watch­ing movies, not at screen­ings but at lo­cal the­aters in Cen­tury City and West­wood.

On the other hand, he en­joyed some trap­pings of wealth, in­clud­ing a 190-foot yacht and 737 jet, and he bought a sec­ond es­tate in the f lats of Bev­erly Hills for those nights when the trip to his 30-acre Bene­dict Canyon com­pound was just too much.

“I’ve al­ways felt he’s the most com­pli­cated man,” fi­nancier Ge­orge Ma­son, one of Kerko­rian’s best friends, said in 2005. “Yet he’s also the most sim­ple man. He thinks dif­fer­ently than most of us. He finds the gut is­sue and fo­cuses on that.”

In a 1969 in­ter­view with For­tune mag­a­zine, Kerko­rian ex­plained his strat­egy: “I don’t try to get all the meat off the bone. When I get a good fig­ure, I just move some­thing. Too many peo­ple try to hit the peak price and they hold on un­til it is too late.”

He did not, how­ever, es­cape the re­ces­sion melt­down. Though his $18-bil­lion net worth in 2007 put him at No. 7 on the Forbes 400 list of rich­est Amer­i­cans, in 2009 he fell to 97th on the list with a net worth of $3 bil­lion.

Forbes most re­cently es­ti­mated his worth at $4 bil­lion.

Kerko­rian was not known as a med­dle­some boss. He said he tried to hire good peo­ple and let them do what­ever they thought nec­es­sary. Some­times this worked out, most spec­tac­u­larly — at least for a while — with his Las Ve­gas hold­ings, which grew through ac­qui­si­tions to en­com­pass about half the Strip’s ho­tel rooms.

His first big deal, in 1962, in­volved 84 acres of land that be­came the home of Cae­sar’s Palace. He built the In­ter­na­tional ho­tel (now the West­gate Las Ve­gas) that opened in 1969 and was billed as the largest re­sort ho­tel in the world. The first MGM Grand, which he built four years later, was 20% big­ger

Twenty years af­ter that he built the MGM Grand Ho­tel and Theme Park.

“He lit­er­ally built the world’s largest re­sorts three dif­fer­ent times,” said Bo J. Bern­hard, ex­ec­u­tive di­rec­tor of the In­ter­na­tional Gam­ing In­sti­tute at the Univer­sity of Ne­vada at Las Ve­gas, on Tues­day. “The foun­da­tion of the enor­mous adult Dis­ney­land is very much a Kerko­rian in­ven­tion.”

If the ho­tels Kerko­rian built were fa­mous for their size, they didn’t set hearts af lut­ter. He was a busi­ness­man, not a vi­sion­ary. Steve Wynn was the artist in town. But when Wynn ran into trou­ble with his prop­er­ties, in­clud­ing the Mi­rage and Bel­la­gio, Kerko­rian scooped them up.

At one point the com­pany he founded as MGM Grand Inc. had 11 Las Ve­gas prop­er­ties, also in­clud­ing the Luxor, Ex­cal­ibur and New York New York.

But the re­ces­sion hit Las Ve­gas par­tic­u­larly hard, and his stake in the prop­er­ties was in large part re­spon­si­ble for the plunge in his per­sonal for­tune.

He helped plan the de­vel­op­ment of the multi-struc­ture, multi-pur­pose City-Cen­ter that opened in 2009 amid fi­nan­cial and le­gal dis­putes. Kerko­rian left the board of the com­pany, then called MGM Re­sorts In­ter­na­tional, in 2011.

In Hol­ly­wood, though he bought and sold the MGM stu­dio mul­ti­ple times, he was an out­sider and not al- ways beloved. His own­er­ship of the stu­dio was most no­table for selling prized as­sets, in­clud­ing the his­toric stu­dio lot in Cul­ver City.

He also re­al­ized the worth of MGM’s vast li­brary — he ag­gres­sively sold film rights to ca­ble chan­nels des­per­ate for con­tent in the 1980s.

He took over the stu­dio the fi­nal time in 1996, not long be­fore the DVD mar­ket took off.

“He uniquely knew the value of the MGM li­brary and the need to pro­tect it,” said Janet Jan­ji­gian, ex­ec­u­tive man­ag­ing di­rec­tor of the Car­men Group West and a for­mer MGM ex­ec­u­tive.

In 2004, he sold the stu­dio to an in­vest­ment group headed by Sony Corp., end­ing its fa­bled 80-year ex­is­tence as an in­de­pen­dent en­tity. Many in Hol­ly­wood held Kerko­rian re­spon­si­ble for the stu­dio’s demise.

Peter Bart, who worked at MGM in the 1980s, de­scribed Kerko­rian in his 1990 book “Fade Out” as “a savvy Las Ve­gas game player” who har­nessed “Hol­ly­wood’s myth­mak­ing ma­chin­ery to serve his per­sonal ob­jec­tives. The end re­sult: Kerko­rian emerged a bil­lion­aire. His com­pa­nies emerged in sham­bles.”

In 2012, an ex­ec­u­tive of Tracinda — Kerko­rian’s com­pany named for his daugh­ters Tracy and Linda — told the Wall Street Jour­nal that Kerko­rian was look­ing to get back into show busi­ness by buy­ing a film stu­dio or other en­ter­tain­ment com­pany, but no such deal ma­te­ri­al­ized.

Kerko­rian’s record was check­ered in the auto world, too. He be­lieved the in­dus­try, par­tic­u­larly the do­mes­tic man­u­fac­tur­ers, could be­come far more com­pet­i­tive and prof­itable, said Alan Baum, a West Bloom­field, Mich., auto in­dus­try con­sul­tant.

As an in­vestor in Chrysler and Gen­eral Mo­tors, Kerko­rian “pushed for bet­ter de­signed prod­ucts and more re­li­able cars,” Baum said.

He was the largest share­holder in Chrysler be­fore it was sold to Daim­ler-Benz in the late 1990s. In 2006, he bought a 9.9% stake in Gen­eral Mo­tors Corp. and tried to use the re­sult­ing lever­age in an un­suc­cess­ful ef­fort to force GM into a re­la­tion­ship with Nissan-Re­nault.

Kerko­rian sought to mount a buy­out of Chrysler with the help of the au­tomaker’s unions, but failed.

He ex­ited the auto in­dus­try in late 2008, as it was head­ing into its worst slump since the Great De­pres­sion. His deal that year to liq­ui­date a stake in Ford was prob­a­bly a money loser.

Only one book was ever writ­ten about Kerko­rian: Los An­ge­les Times staff writer Dial Torg­er­son’s 1974 vol­ume, “Kerko­rian: An Amer­i­can Suc­cess Story.” Torg­er­son got much be­hindthe-scenes help from his sub­ject, who on the record re­fused to be in­ter­viewed for it.

In many ways, it was the clas­sic Amer­i­can im­mi­grant story. Kerko­rian rose from hard-scrabble poverty to com­fort to ex­treme wealth, pow­ered by lit­tle more than energy and guts.

Kerkor Kerko­rian, later Amer­i­can­ized to “Kirk,” was born in Fresno on June 6, 1917. He was the fourth and last child of Lily and Ahron, both im­mi­grants from Ar­me­nia, then part of the Ot­toman em­pire.

Kerko­rian’s first ven­ture into real es­tate oc­curred at age 4. His fa­ther, who owned 10 heav­ily mort­gaged farms in the Cen­tral Val­ley, put the fam­ily ranch into young Kirk’s name in a bold at­tempt to shel­ter the land from cred­i­tors. When the farms failed in the 1921-22 re­ces­sion, the fam­ily moved to Los An­ge­les.

They moved of­ten, from Lin­coln Park to South Los An­ge­les to Jef­fer­son Boule­vard. “Ev­ery­one was hun­gry,” Kerko­rian’s el­der sis­ter Rose, who died in 2012, said in a 2005 Times in­ter­view. “We had to move ev­ery three months be­cause we couldn’t pay our rent.”

The poverty per­haps gave him a life­long dis­trust of pos­ses­sions. “I’m not mar­ried to any­thing,” Torg­er­son quoted him as say­ing fre­quently.

His for­mal ed­u­ca­tion ended in the eighth grade at a school for delin­quents at 6th and Main streets in down­town Los An­ge­les. De­spite all his achieve­ments and wealth, his early exit from school both­ered him. He wished, he said in the 2005 Times in­ter­view, he had the sil­ver tongue of fel­low real es­tate de­vel­op­ers Don­ald Trump or Wynn.

“I’ve al­ways been a quiet guy,” Kerko­rian said.

But he was a fighter, even with his fists. As an am­a­teur boxer in his youth, he scored 29 wins, many by knock­out, but “the Bak­ers­field Bomber,” also known as “Rif le Right Kerko­rian,” wasn’t quite big or fast enough to make it as a pro. In­stead, fate in­ter­vened. A friend work­ing on his pi­lot’s li­cense took Kerko­rian on a ride in a Piper Cub from Al­ham­bra Air­port.

That lark turned into an ob­ses­sion that would de­fine his life for decades. Kerko­rian got his own li­cense, be­came a flight in­struc­tor and in 1942 took a job as a ferry pi­lot with the Royal Air Force. “I loved get­ting $1,000 a month — and the ex­cite­ment,” he told the Times.

The thrills were con­sid­er­able, ac­cord­ing to Torg­er­son’s bi­og­ra­phy. The planes Kerko­rian was trans­port­ing from Canada to Bri­tain were De Hav­il­land Mosquitoes — ex­cel­lent fight­ers but poorly suited for a long flight across the icy ocean.

“Life is a big craps game,” Kerko­rian said in 2005. He laughed. “I’ve got to tell you, it’s all been fun.”

Decades be­fore his death, money ceased to have much per­sonal im­por­tance. “I have made enough to re­tire, but that would be a pretty dull life for me, wouldn’t it?” he told The Times in 1969, when he was 52 and worth about $250 mil­lion.

In­stead, friends agreed, he did deals to do them, to stay in the game, to beat the odds.

For all his at­tempts to stay un­der the radar, Kerko­rian’s messy di­vorce from his third wife, for­mer ten­nis pro Lisa Bon­der, be­came a public spec­ta­cle in 2002 when she re­quested an in­crease in child sup­port from $50,000 a month to $320,000 a month. And there was the added wrin­kle of a pa­ter­nity dis­pute — DNA tests showed Kerko­rian was not the bi­o­log­i­cal fa­ther of the child, born be­fore they were mar­ried.

More typ­i­cal of his life was the quiet man­ner in which he en­gaged in phi­lan­thropy.

His Lincy Foun­da­tion — also named for his daugh­ters — was founded in 1989, ini­tially to aid vic­tims of a dev­as­tat­ing earth­quake in Ar­me­nia. Over the years it gave more than $1 bil­lion to var­i­ous causes, in­clud­ing about $270 mil­lion to UCLA.

“He was one of the most gen­er­ous peo­ple I’ve ever met, and one of the qui­etest about it,” Lee Ia­cocca, for­mer Chrysler chief ex­ec­u­tive, said in a state­ment.

Un­like other ma­jor con­trib­u­tors, he did not re­quest his name be put on build­ings. And his gifts were not al­ways to public in­sti­tu­tions.

“He was the type of per­son who would have a $10 meal and give the waiter a $100 tip,” Jay Rakow, for­mer MGM ex­ec­u­tive and head of the foun­da­tion, said Tues­day. “He never for­got where he came from.”

Kerko­rian, who was mar­ried four times — most re­cently to Una Davis, ac­cord­ing to a 2014 re­port in the Las Ve­gas Sun — was sin­gle at the time of his death. He is sur­vived by daugh­ters Tracy Kerko­rian and Linda Kem­per; and three grand­chil­dren.

‘I have made enough to re­tire, but that would be a pretty dull life for me, wouldn’t it?’

— Kirk Kerko­rian, in 1969, when he was 52 and worth about $250 mil­lion

L as Ve­gas News Bureau

OP­ER­AT­ING ON IN­STINCT Kirk Kerko­rian in 1969 be­fore the open­ing of the In­ter­na­tional Ho­tel in Las Ve­gas — billed as the world’s largest re­sort ho­tel.

Kevork Djansezian As­so­ci­ated Press

FOR­MER BOXER, PI­LOT Kirk Kerko­rian at the May­weather-De la Hoya fight in Las Ve­gas in 2007.

At one time, his net wealth was es­ti­mated to be $18 bil­lion.

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