A Newspaper in Las Vegas, at Risk of Closing, Divides a Family

Ronda Churchill for The New York TimesRic Anderson, center, the managing editor of The Las Vegas Sun, speaking to Brian Greenspun, its editor and publisher.

Tanned and fit, collar unbuttoned and no socks under his loafers, Brian Greenspun, the president of The Las Vegas Sun, stood in the middle of the newsroom, surrounded by $500 Herman Miller chairs, flat-screen monitors and floor-to-ceiling third-story windows offering an unmatched view of the Las Vegas Strip.

The Henderson, Nev., newsroom of The Las Vegas Sun, which won a Pulitzer Prize in 2009.

It was June 2005. Mr. Greenspun, whose family has owned the paper since his parents founded it in 1950, told dozens of reporters and editors that the joint operating agreement between The Sun and its more conservative rival, The Las Vegas Review-Journal, had been amended: The Sun would become the first daily in the country to be delivered inside its competitor, as if it were a separate section.

Despite the skepticism of some staff members that day, the newspaper was able to attract top journalists from across the country, resulting in national awards, including a Pulitzer Prize in 2009. But the financial downturn, particularly harsh in Nevada, pummeled the paper, and dozens of longtime employees were laid off.

And now, the paper itself might disappear. Stephens Media, owner of The Review-Journal, wants to dissolve the joint agreement, intended to preserve newspapers. In exchange, the Greenspun family would receive the domain name lasvegas.com, a Web site the family currently leases from Stephens for up to $2.5 million a year and then subleases to the Las Vegas Convention and Visitors Authority.

Mr. Greenspun’s brother, Danny Greenspun, and two sisters, Susan Greenspun Fine and Jane Greenspun Gale, all voted to accept the offer, but Brian wants to fight. Last month, he accused his siblings of “deciding to kill The Las Vegas Sun,” and he is suing Stephens, claiming that the offer gives The Review-Journal a local monopoly over news gathering and opinion.

At stake, he says, is Las Vegas’s future as a two-newspaper town. Doing away with the joint operating agreement “is equivalent to buying The Sun and shutting it down,” he said, adding of his siblings, “It’s a business deal to them.”

The dispute is the latest twist in the outsize history of the Greenspuns and Las Vegas. While there are better-known publishing families in the United States, few are more colorful.

Hank Greenspun started the paper with his wife, Barbara, after working as a publicist for the gangster Bugsy Siegel. In the 1940s, he was convicted of running guns to the paramilitary group that would become the Israeli Defense Forces. (He was fined, never jailed and later pardoned by President John F. Kennedy.) In the ensuing decades, he helped end segregation on the Strip, developed an 8,000-acre master-planned community and brought cable television to Las Vegas. He was also revealed to be a proposed target of the Watergate burglars. The Greenspun name is on schools, clinics and colleges.

The Sun first came to prominence in the 1950s for its opposition to Senator Patrick McCarran’s red-baiting tactics. (Hank Greenspun was also a vociferous opponent of Senator Joseph McCarthy.) It continued to be a liberal voice amid the city’s dizzying growth, but by the time of Hank Greenspun’s death in 1989, the paper was losing millions. Within months, the joint agreement was created, but circulation continued to slide. By 2005, when the deal was revised, The Sun had fewer than 30,000 readers and essentially became a 6- to 10-page insert with no advertising.

On that day in 2005, Mr. Greenspun assured the 75 or so staff members that the deal would let the paper reinvest in journalism. In 2009, the paper won the industry’s highest honor, a Pulitzer Prize, for a series about construction deaths on the Strip.

But as the economy staggered, many of those same journalists were laid off or left. The paper once received as much as $12 million a year in profit-sharing through the joint agreement and now receives $1.3 million. Last month, the Greenspuns voted to dissolve the partnership.

None of the other Greenspun siblings would discuss the case. Brian Greenspun maintains that the deal violates antitrust laws. “In every antitrust violation, there’s always been at least two parties who combine based on it being a good business decision,” he said. His lawyers include Leif Reid, son of the Senate majority leader, Harry Reid, another prominent family in Nevada and long supported by The Sun.

But Donald Campbell, outside counsel for Stephens, said: “We believe his beef is with the wrong people. He is a dissident shareholder. The problem he has is with his own family.” Mr. Campbell also said the offer did not include a noncompete clause, so the Greenspuns, or anyone else, would face no legal obstacle in continuing to print The Sun. Mr. Greenspun contends that the costs to do so would be prohibitive.

Crowds Return to Las Vegas, but Gamble Less

These days, jobs are back, the housing market is bustling and people are moving back. The number of visitors hit a record last year. For anyone seeking evidence that the nation has survived this recession, look no farther than the sidewalks of Las Vegas Boulevard, where people were shoulder to shoulder the other day even as temperatures surged past 110 degrees.

But the recovery in Las Vegas — much like the one lifting the nation — is shaping up as fragile and tentative, stirring concern among economists and many of the region’s biggest boosters. And it is signaling what appears to be a fundamental reordering of the economy in this closely watched part of the country.

More than 39.7 million visitors came here in 2012, a record. But those visitors spent notably less money per trip than during the last upturn — $1,021 per visit last year, compared with $1,318 spent by each of the 39.2 million visitors in 2007, according to the Las Vegas Convention and Visitors Authority — a sobering asterisk that has led many analysts to conclude that this high-rolling city is entering a less prosperous era.

The total revenue from gambling and entertainment other than gambling was $15.3 billion in 2012, $500 million less than was spent in 2007.

“The Strip is absolutely packed, downtown is packed,” said David G. Schwartz, the director of the Center for Gaming Research at the University of Nevada, Las Vegas. “People are here. But they aren’t spending as much as they used to.”

A shift in the structure of the economy that began about a decade ago appears to have accelerated. Gambling is no longer king. A new influx of tourists, younger and less devoted to gambling, are likelier to open their wallets for extravagantly priced nightclubs and day clubs, which have joined concerts and musical shows, high-end restaurants, luxury shopping and some of the more exotic types of entertainment this city is renowned for offering.

From the Mandarin Oriental Hotel’s 23rd-floor bar the other evening, with its desert views and $18 specialty cocktails, the new building-size digital billboards that loom over the Strip flashed out advertisements not for the slots, but for Tiesto, the D.J. playing at Hakkasan, a 75,000-square-foot nightclub where reserving a table for the night can cost $10,000 and more.

“Gaming went down more than total visitor spending, by a greater percentage,” said Stephen P. A. Brown, the director of the Center for Business and Economic Research at the University of Nevada, Las Vegas. “The visitors who have come back are here for clubs and shopping. They’re buying swimsuits to go to the day clubs and evening clothes to go to the nightclubs. That’s the big growth.”

“I think what’s going on here is we’re seeing a shift away from Las Vegas as the only gaming destination in the United States to being one of many gaming destinations,” Mr. Brown said. “But it is holding up as a tourist destination.”

In 1984, the city’s sprawling casinos accounted for 59 percent of all the money collected on the Strip. Last year, gambling made up just 36 percent of the revenue. Clark County, which includes Las Vegas, took in $9.4 billion in gambling revenue last year, up from the year before but still far short of the $10.8 billion during the peak year of 2007, according to statistics from the Center for Gaming Research.

Beyond tourism, the baseline statistics of economic growth give reasons for both hope and concern, analysts said. Home prices jumped by 15.3 percent in the Las Vegas metropolitan region this year, according to the Case-Shiller home price index, but still remain 56 percent below their peak in 2007. Jobs grew last year at a rate of 2.6 percent, compared with 1.7 nationally, but that is short of the 3.7 percent average growth rate posted during the boom years of 2001 through 2007.

And there are potential problems ahead. Many analysts here argue that the super-hot housing market amounts, yet again, to a bubble, and are girding for another collapse in prices. Some of the biggest casino owners, including MGM and Caesars Palace, are saddled with debt.

Kitty Bennett contributed research.

DealBook: SkyBridge's Scaramucci Plays Host in Las Vegas

LAS VEGAS — Just outside the grand ballroom at the Bellagio hotel early Wednesday morning, Anthony Scaramucci, the backslapping host of the country’s largest hedge fund conference, spotted Gregory J. Fleming, president of Morgan Stanley Investment Management and one of Mr. Scaramucci’s most important business relationships.

“Is your kid still in town? Does he want to meet Train?” Mr. Scaramucci asked, referring to the adult-contemporary rock band performing at the event. “It’s great to have you here; it really means a lot to me.”

The hedge fund faithful, more than 1,800 strong, have come here for the SkyBridge Alternatives Conference, or SALT. Held over four days, SALT is a Wall Street schmooze-fest. This year’s lineup of speakers features the investors Daniel S. Loeb and John Paulson, the politicians Nicolas Sarkozy and Leon Panetta, and the entertainers Oliver Stone and Al Pacino.

It is also a matchmaking service, with funds peddling their services to the world’s richest investors, and the world’s richest investors seeking out the next superstar manager. And this being Sin City, it is, perhaps above all else, a good time.

The ringmaster of this spectacle is Mr. Scaramucci, a Goldman Sachs alumnus with a Harvard Law degree whom many simply call “the Mooch.” In an industry known for reclusive traders and math geeks, the boyish Mr. Scaramucci, 49, is Wall Street’s first hedge fund impresario, a P. T. Barnum in a Ferragamo tie. In a gilded industry that has preferred to stay below the radar, Mr. Scaramucci embraces the white-hot center of it all.

A relentless self-promoter, Mr. Scaramucci is ubiquitous, especially to the stock traders and market aficionados who stare all day at Bloomberg terminals and have their flat screens fixed to business television.

He appears regularly on CNBC, jawboning about stocks. He wedged his way into a cameo in Mr. Stone’s 2010 sequel to the movie “Wall Street.” He has written two books: the first, “Goodbye Gordon Gekko,” is part memoir, part self-help manual about “how to find your fortune without losing your soul”; the second, “The Little Book of Hedge Funds,” is a primer on the investment vehicles that have made him rich.

“Mutual funds are the propeller plane,” writes Mr. Scaramucci in his primer, “while hedge funds are the fighter jets.”

That analogy has not worked well lately. The ascent of SALT, and Mr. Scaramucci, comes in a challenging time for hedge funds, which are expensive investment vehicles that promise outsize returns in up and down markets. The explosive growth experienced by the industry a decade ago has plateaued. For four consecutive years, the average hedge fund has failed to beat the Standard & Poor’s 500-stock index.

Despite the weak performance, hedge funds, which have a total of about $2.5 trillion in assets, are still attracting money, taking in $15.2 billion in the first quarter of this year, according to Hedge Fund Research.

The SALT crowd can thank the Federal Reserve’s persistent near-zero interest rate policy for their continued good fortune. Managers are also seeing money flood into debt-trading strategies as the world’s largest banks have retrenched from those risky investments under greater regulation.

Tepid industry performance cannot stop Mr. Scaramucci, whose irrepressible salesmanship seeks to elevate the SkyBridge Capital brand. A manager of a portfolio of hedge funds — a “fund of funds,” in Wall Street lingo — the New York-based firm has about $4.6 billion under management. It also oversees another roughly $3 billion in a business that advises pensions and other large institutions on hedge-fund-manager selection.

Mr. Scaramucci has built SkyBridge on the belief that hedge funds are not just the domain of giant pension funds and the Forbes 400 list of the wealthiest Americans.

SkyBridge’s flagship product is structured for “the mass affluent,” requiring a net worth of $1 million and a minimum investment of $25,000. Sold through brokers at big banks like Morgan Stanley and Merrill Lynch, SkyBridge has more than 24,000 clients. A typical customer is a dentist with a million or two in the bank and a desire to spice up his or her portfolio with a dollop of hedge fund exposure.

“I’m a middle-class kid from Long Island, and neither of my parents went to college,” said Mr. Scaramucci, a father of three who grew up in Port Washington, N.Y., and now lives just a couple of miles away in Manhasset. “Why shouldn’t more people have access to this industry?”

The access doesn’t come cheap. On top of the usual 2 percent management fee and a 20 percent cut of the profits charged annually by the hedge funds in SkyBridge’s portfolio, the firm adds a 1.5 percent yearly fee, along with a one-time placement charge paid to the broker that runs as high as 3 percent.

Not everyone buys what Mr. Scaramucci is selling. Critics decry the hefty fees that they say eat into the performance of funds of funds.

“Hedge funds tend to be a losing game for most investors,” said Mebane T. Faber, co-founder of Cambria Investment Management. “With fund of funds, it is even more of a losing game because of the layers upon layers of fees.”

Yet Skybridge’s main fund, which profited from a concentrated bet on managers investing in beaten-down mortgages, returned 20.2 percent last year net of fees, handily outperforming the S.& P. But over a 10-year stretch, the fund has slightly underperformed the index.

“Reversion to the mean is a very powerful force,” said Jack Bogle, founder of Vanguard and evangelist for low-cost funds that track the indexes. “These hedge fund products might work in the short term, but I can absolutely guarantee that they won’t work forever.”

SkyBridge almost didn’t work right out of the gate. Mr. Scaramucci started the firm in 2005 after spending seven years at Goldman and then co-founding a money-management firm that he sold to Neuberger Berman. He originally formed SkyBridge to seed and incubate start-up hedge fund managers. But after the financial crisis crushed SkyBridge’s portfolio of nascent funds, Mr. Scaramucci sought to reinvent the business.

He soon sniffed out an opportunity. When a sickly Citigroup sought to jettison its hedge fund unit, he negotiated a deal in June 2010 for SkyBridge to pay for the business with a small upfront payment and a revenue-sharing agreement with the bank that expires next month.

With the Citigroup acquisition, Mr. Scaramucci not only added several billion dollars in assets, but also acquired Citigroup’s Raymond C. Nolte, a veteran hedge fund executive who now oversees SkyBridge’s investments. Mr. Nolte also brought with him a respectable track record that Mr. Scaramucci could promote.

The SALT conference, too, grew out of the financial crisis. After President Obama warned Wall Street banks in early 2009 against throwing junkets on the taxpayers’ dime, several banks canceled their Las Vegas conferences. Mr. Scaramucci decided to fill the void, holding the first SALT conference at the Wynn, with 400 people in attendance.

SALT has become the main engine of the SkyBridge marketing machine, though Mr. Scaramucci is quick to point out that it is not a SkyBridge event but an industrywide conclave. The conference is profitable, he says, but not as profitable as it would be if its organizers did not pour so much money back into it, paying top dollar for prominent speakers among other expenses.

Appearing at this year’s event are Ehud Barak, the former Israeli prime minister; Mike Krzyzewski, the Duke University men’s basketball coach; and Barney Frank, the former Massachusetts congressman.

Most of the talks take place in the main ballroom, but much of the real action happens behind the scenes at V.I.P. events. On Wednesday night, Mr. Scaramucci was holding a dinner for about 20, with Mr. Panetta, Mr. Pacino and others, where they were to eat a meal catered by Jean-Georges Vongerichten’s ABC Kitchen, featuring organic chicken and collard greens paired with a polished Peay Vineyards syrah.

On Thursday, SkyBridge’s top 20 clients will have breakfast with Matt Bissonnette, who under the pseudonym Mark Owen wrote “No Easy Day,” the first-person account of the raid that killed Osama bin Laden.

SALT has become so larded with famous names that Mr. Scaramucci acknowledges the problem of having to live up to the agendas of previous conferences. He has set a high bar with past keynote speeches by former presidents Bill Clinton and George W. Bush, as well as Mitt Romney. (Mr. Scaramucci supported Mr. Obama in 2008, but served as Mr. Romney’s national finance co-chairman in the last election.)

That challenge is evident with this year’s entertainment. On Thursday evening, Train will perform, arguably a downgrade from last year’s concert by the pop superstars Maroon 5. Mr. Scaramucci staunchly defended this year’s musical act.

“I’ll tell you a little secret” Mr. Scaramucci said. “Middle-aged white men? They love Train.”