\nRichard N. Velotta and Howard Stutz, Las Vegas Review-Journal<\/p>\n
\tThe walls of the Riviera will, indeed, come tumbling down.<\/p>\n
\tThe Las Vegas Convention and Visitors Authority on Tuesday scheduled a special board meeting on Friday to consider acquisition of the 60-year-old Strip resort for $182.5 million, which includes up to $8.5 million in transaction-related expenses. Morgan Stanley, which was hired to oversee the transaction, would receive $3.5 million flat fee. The remainder would pay title fees, legal and professional fees, surveys and environmental studies.<\/p>\n
\tIf approved, the Riviera would close in mid-August and be demolished to make way for a portion of the $2.3 billion Las Vegas Global Business District, a major expansion of the Las Vegas Convention Center to include new and upgraded facilities, a trade center and a multimodal transportation hub.<\/p>\n
\tThe acquisition cost includes business closure expenses and the real estate price of the property, which is less than the authority\u2019s most recent appraisal. A $275 million credit facility with JP Morgan approved last September would cover the transaction.<\/p>\n
\tThe 14-member board will consider a contract to acquire the Riviera and its 26.4 acres from Riviera Holdings, a subsidiary of Starwood Capital Group. The transaction would close immediately but the agreement includes a lease-back provision enabling the casino\u2019s manager, Las Vegas-based Paragon Gaming, to continue to operate the property and handle its eventual closure. The authority would not manage the property.<\/p>\n
\tPrivately held Paragon, headed by Dianna Bennett \u2014 daughter of the late Las Vegas gaming pioneer William Bennett \u2014 began managing the Riviera in June 2013 following a major shake-up that included the firing of the CEO.<\/p>\n
\tGaming Control Board Chairman A.G. Burnett said the regulatory agency had been briefed on the deal. He said the LVCVA would not have to be licensed for the Riviera.<\/p>\n
\t\u201cThe audit division and tax and license division will work with Paragon since it appears to be a short-term, gradual close-down process,\u201d Burnett said.<\/p>\n
\tA spokeswoman for Paragon said the company would not comment on the matter until after Friday\u2019s LVCVA board meeting. A spokesman for Greenwich, Conn.-based Starwood could not be reached for comment.<\/p>\n
\tAccording to a 2013 regulatory filing, the 2,100-room hotel-casino had more than 850 employees. Culinary Local 226 Secretary-Treasurer Geoconda Arguello-Kline said the union is \u201cdoing the utmost to protect our members.\u201d<\/p>\n
\tNegotiations between Morgan Stanley and Starwood began in August. Reports of a prospective deal surfaced last week, but officials with the authority, Starwood and Paragon offered no comment on those reports.<\/p>\n
\tUnder terms of the deal, property managers would have six months to close and vacate the building. A 90-day extension is possible to assure that the closure, expected around Aug. 20, occurs within provisions of the state\u2019s gaming laws.<\/p>\n
\tThe Riviera was was considered the Strip\u2019s first high-rise resort when it was opened by Miami-based investors in April, 1955. Liberace headlined the resort\u2019s opening. Two of the famous Marx Brothers comedy team \u2014 Harpo Marx and Gummo Marx \u2014 held small ownership stakes.<\/p>\n
\tThe resort took a star turn as the mob-run \u201cTangiers\u201d in Martin Scorsese\u2019s 1995 movie \u201cCasino.\u201d<\/p>\n
\tOver the years, the Riviera went bankrupt three times and had several owners, including famed mobster Meyer Lansky. Israeli businessman Meshulam Riklis owned the Riviera between 1973 and 1991. Twice the property went into bankruptcy under his ownership and he eventually lost the property to creditors.<\/p>\n
\tIn 1997 the hotel became the home of a Las Vegas icon \u2014 a life-size bronze sculpture of seven gee-string-clad dancers from its \u201cCrazy Girls\u201d topless show, in a line as seen from the rear. Visited by countless tactile tourists, the metal bottoms of the dancers are always burnished to a golden glow.<\/p>\n
\tStarwood became the primary owner of the resort after Riviera Holdings Corp. filed for bankruptcy in July 2010.<\/p>\n
\tThe authority has made several land acquisitions for the planned $2.3 billion Las Vegas Global Business District, but most of that property has been south of the existing Las Vegas Convention Center campus off Sierra Vista Drive.<\/p>\n
\tThe Global Business District proposal, a plan to refurbish the 3.2 million square-feet of convention halls to maintain the city\u2019s lead as the nation\u2019s top trade show destination, includes a transportation component that community leaders have been discussing for nearly a year.<\/p>\n
\tAuthority officials have said that about 20 major trade shows have expressed interest in Las Vegas, but couldn\u2019t because the calendar was full and there wasn\u2019t enough room to accommodate them. They believe the planned 750,000 square-feet in expansion and the renovated facilities would help them land those shows and bolster the city\u2019s position as the nation\u2019s leading trade-show host.<\/p>\n
\tTuesday\u2019s announcement was hailed as good news for the Las Vegas resort market, if the end of an era for a venerable Strip hotel.<\/p>\n
\tMGM Resorts International Chairman Jim Murren said he supports the transaction because it allows the LVCVA to have a presence on the Strip. The Global Business District, he said, will give Las Vegas another boost in its competition for convention business with Chicago, Orlando and other cities.<\/p>\n
\t\u201cThis is really going to be bad news for other convention markets,\u201d Murren said. \u201cI love this deal because it will create an attractive corridor from the Strip to the Convention Center. It\u2019s going to help bring people down to that end of the Strip.\u201d<\/p>\n
No replies were posted for this topic.<\/p>\n","protected":false},"excerpt":{"rendered":"
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