IS THERE no alcohol at all during the day, asked Sol Kerzner. “You can’t get a beer with lunch?” No matter how experienced, successful or wealthy you are, doing business in the Gulf can catch you off guard.

Kerzner, the London-based South African billionaire casino and hotel operator, flew to Dubai last month to supervise the rebuilding, after a fire, of the lobby of his latest £1-billion resort, the Atlantis.

When he got there, he discovered that during the Muslim holy month of Ramadan hotels cannot serve alcohol before sunset. “No booze? That’s news to me.” Then a grin spread across his ridgy face. “Hey, what do I care? I don’t drink anymore.”

There are a lot of things Kerzner does not do anymore. He quit his beloved scotch after checking in to the Betty Ford Clinic to dry out. He has stubbed out the 60 cigarettes a day he used to smoke. He has even kicked his serial marriage habit. He and Heather, his fourth wife, have been together for 10 years. There’s one uncontrollable addiction, though: business.

Aged 73, and still adjusting to life after a triple heart bypass and the death in a helicopter accident two years ago of his son, Butch, he is about to take his biggest gamble since defying international opposition and opening Sun City in Bophuthatswana, an “independent” tribal “homeland” in apartheid South Africa.

He is sinking £400-million into the 1600-room Atlantis hotel and aquatic theme park in Dubai and spending hundreds of millions more expanding his existing One & Only hotel in the Arab emirate and building a second One & Only on The World, a collection of man-made islands arranged in the shape of a map of the globe.

Atlantis is the biggest hotel in the Middle East. It sits like a giant pink crown atop the Palm Jumeirah, an artificial island in the shape of a date palm. Its size and prominence mean the three-day grand opening party later this month will be attended by Sheikh Mohammed bin Rashid Al Maktoum, Dubai’s ruler, and the most senior business executives in the region, notably Sultan Ahmed Bin Sulayem, boss of Palm developer Nakheel and Kerzner’s partner in Atlantis. Nakheel has invested £400-million.

Also coming to the “black tie ’n’ dishdasha” bash are 2000 of Kerzner’s celebrity friends, including Robert de Niro, Denzel Washington and Naomi Campbell. Kylie Minogue will perform a concert and there will be a fireworks display six times larger than the one at the Beijing Olympics. The event will be broadcast live around the world.

So, no pressure then. Kerzner laughs: “Sure, this is by far the biggest global event we’ve done and the biggest-ever public party staged by private enterprise. But it does not help to get nervous.”

It is not just the risk of a spectacular public failure if anything goes wrong that makes the stakes so high. It is the fact that the Atlantis goes against so much that has made Kerzner one of the world’s most successful hoteliers.

He has created his privately-held, £2-billion global hotel and casino brand by offering “anything goes” hedonism. At his flagship properties there has always been round-the-clock boozing and seven-card stud. Cinemas at Sun City showed porn and there were topless dancing girls.

Step into the Atlantis at lunch time during Ramadan, though — the hotel “soft opened” last month — and there’s not so much as a spritzer in sight. Topless sunbathing, let alone strip shows, is banned, and anyone caught gambling is treated to an extended stay in one of the sheikh’s un air-conditioned police cells. Can the Kerzner magic work in such a restricted market or will his pink palace crumble like a giant sandcastle into the Gulf?

Kerzner concedes that he is in uncharted territory but, sin or no sin, is sticking to his formula of offering people something they have never experienced before.

“There’s nothing like Atlantis for 1000 miles in any direction, just like there was nothing like Sun City in Africa or Atlantis in the Caribbean when we opened there,” he explained.

“We’re offering the first $1-million a-room resort; a water-based Disney style theme park for all ages; restaurants by Nobu and Giorgio Locatelli for the adults. And we’re doing it in an iconic building on the iconic development in the Gulf.”

Kerzner points out that, with petrodollars shielding the Gulf from the worst effects of global slowdown, the local economy is still strong.

“There’s no better example of growth than Dubai. Despite everything, most sectors are still expanding. The infrastructure is fantastic.”

He describes business at his existing One & Only hotel as “brisk”. The latest figures confirm that the Middle East had the highest hotel occupancy rates in the world during the first half of the year, with Dubai leading the region at 85.3%.

So far, so promising. But the timing of the launch is lousy. With consumers outside the Gulf tightening their belts, visitor numbers are set to fall. Indeed, privately, luxury hotel groups concede that bookings slumped last month and it will get worse in the run-up to Christmas.

Critics say that opening a £1-billion hotel with a three-day bash whose overall cost is an estimated £40-million — exceeding the record £38-million that Britain’s richest resident, steel magnate Lakshmi Mittal, spent on his daughter Vanisha’s wedding at the Palace of Versailles in Paris in 2004 — is in bad taste at a time of growing austerity.

“It’s not just about a party,” Kerzner bristled. “We’re establishing a multi billion-pound project that will do good business for us and for the people who work here and be an amazing experience for those who come. In bad times, people need to escape reality.”

Kerzner executives point out that much of the bill for the party is being footed by Sheikh Mohammed and his lieutenants.

And then there is the thorny issue of religion. Kerzner is the most high profile Jewish entrepreneur publicly to launch a joint venture with Dubai’s Arab rulers, who — officially at least — do not do business with Israel. Is Kerzner concerned that local Arab consumers will boycott, rather than book in to, Atlantis?

“It’s not the world’s greatest secret who I am and where I come from, but it’s not really been an issue. Sultan and I have not really discussed it. And he has certainly never called me on the Jewish holidays,” Kerzner joked. “I suppose it might be different if I were from Israel but I’m South African.”

If Atlantis is a success, Kerzner, whose 30% stake in Kerzner International is worth £700-million, plans to launch a sister hotel — with his biggest-ever casino — in Las Vegas at a cost of £2.5-billion in a joint venture with gambling giant MGM Mirage.

Kerzner and MGM have bought land on the Las Vegas Strip but, with the American gambling industry in the doldrums, Kerzner won’t press ahead “until the second half of next year at the earliest”.

He is also developing a £300-million casino and property development in Morocco, called Mazagan, and hopes to expand into Asia, opening the first Atlantis there.

He is going home too. After selling all his South African interests 20 years ago, Kerzner is sinking £50-million into his first One & Only in Cape Town, to be followed by another in Zanzibar. “I may live in London but Africa is in my blood. To go back and re-establish ourselves there is very special.”

After the British government amended its gambling proposals earlier this year, forcing him to abandon plans for a “super-casino” in Manchester, Kerzner has given up on gambling in Britain. “There’s nothing on the table. Gordon Brown cost me millions. I’d send him a bill if I thought he’d pay it.”

Kerzner will blow many more millions in a single night at the grand opening of Atlantis. The good news for guests flying in is that it will take place after Ramadan and drinks will flow.

Indeed, Kerzner tried to buy almost the entire available stock of £500-a bottle Cristal champagne, a favourite with rappers and Arab playboys. However, Louis Roederer, the champagne house that makes Cristal, refused because it said such a large order would force up prices unacceptably high.

“We’ll be serving Dom Perignon,” said Kerzner, adding, “although Sultan and I will be on orange juice.” — ©The Sunday Times, London

Source: Business Times