Breaking news from the R-J: Station Casinos filed Chapter 11 in U.S. Bankruptcy Court in Reno today to restructure $5.7 billion in debt, most of which helped finance the company’s buyout nearly 21 months ago. The company said this morning that it has reached an agreement with its bank lenders to take the parent company and its noncasino subsidiaries, which include the company’s landholdings in Reno and other nongaming assets, into bankruptcy, Chief Accounting Officer Thomas Friel said today. He stressed, however, the agreement will “not require us to file for the operating subsidiaries,”which are the company’s casino properties themselves.
“The operating subsidiaries, all 18 casinos, will continue to operate exactly like they do today,” he said. “All the cash that gets generated from them will continue to be used on a normal basis.” Station Casinos owns and operates Red Rock Resort, Palace Station, Sunset Station, Boulder Station, Texas Station, Santa Fe Station, Wild Wild West, the two Fiesta properties, the Wildfire properties and vast land holdings in Clark County and Reno. The company also has a 50 percent interest in Green Valley Ranch and Aliante Station, which are owned outside the company. Chief Operating Officer Kevin Kelley said the bankruptcy will not affect employees or vendors getting paid or the company’s reward point system. “It is business as usual at our 18 operating properties,” Kelley said. “Team members, guests and vendors are going to be treated just as they always have been for the last 33 years.” The filing covers the nearly $900 million in bank debt, $2.3 billion in bonds and $2.475 billion in a commercial mortgage-backed securities debt at the property level, Friel said. Friel said an agreement has not been reached with any of the company’s lenders about how the company will be restructured. “The debt resides at the parent company, and we have an agreement with the lenders at the parent company that allows us not to put in the operating companies so the operating properties can operate normally through this process,” he said. The company also has an agreement, subject to court approval, to borrow up to $150 million in cash to assist the company through bankruptcy. Herbst Gaming filed a similar Chapter 11 bankruptcy plan in March. Today’s bankruptcy filing, expected this afternoon, is not the prepackaged bankruptcy plan the company announced in February. Station Casinos had proposed a prepackaged plan that would allow the gaming company to eliminate about half of its $5.7 billion debt load. The prepackaged bankruptcy plan asked investors holding the $2.3 billion in unsecured bonds to swap high-cost debt for low-cost debt and cash. If investors had agreed, the company would have entered into a Chapter 11 bankruptcy. In November 2007, Station Casinos was taken private in a $5.4 billion buyout by the Fertitta family, the company’s founders, and real estate investment firm Colony Capital. Colony Capital owns 75 percent of the company and the Fertittas hold the remaining 25 percent. The company had entered into a series of forebearance agreements while it continued trying to negotiate a bankruptcy agreement with its debt Station Casinos, like other local gaming companies, has struggled to make payments on the heavy debt loads it racked up in the past several years because the recession has hurt visitor volume and spending in Las Vegas. “We feel this process is the best process in order to emerge a much stronger company,” Kelley said today. “Having less debt will allow us the ability to go out and pursue our long-term goals we have for the valley. We believe our business plan is sound. We believe in the long-term future of Las Vegas and its growth and we want to be a part of that for a very long time to come.”
40th Anniversary of Elvis Presley's Comeback in Las Vegas
Last week it was the 40th anniversary of the Moon Landing we celebrated. This Thursday, it will be the 40th anniversary of Elvis Presley's comeback at the International Hotel (now the Las Vegas Hilton). Send us your Elvis memories and we'll post them as part of our tribute to the King on Thursday.
In the meantime, our pal Mike Weatherford writes:
In a few weeks, everyone will be remembering Elvis Presley on the day he died, Aug. 16. On Thursday, Las Vegas should pay more attention to the day he was reborn, one that changed things around here for keeps. Thursday is the 40th anniversary of Elvis' debut at the International Hotel, now the Las Vegas Hilton. If you take Elvis seriously, cue up "Suspicious Minds." If you goof on him, make yourself a peanut butter and banana sandwich. Just don't ignore it.
At the time, the Elvis comeback took a back seat to the lingering euphoria over the moon landing. But this giant step for Vegas-kind still echoes all around town, from wedding chapels to the next big Cirque du Soleil, due at CityCenter in December. Ken Sharp, a Los Angeles writer and producer, first called me a year and a half ago for contacts on a book about Presley's live comeback in Las Vegas. Last week, he was excited to have received his first copy of "Elvis '69," which has its formal release during "Elvis week" at Graceland next month. "This was a guy who was able to come home again," Sharp says. And not just because Presley was treated like an oddity during an ill-advised New Frontier showroom run in 1956. In the bigger picture, Presley had shaken the diminished returns of his movie career with his 1968 comeback TV special. In the recording studio, he regained his credibility with hits such as "If I Can Dream" and "In The Ghetto." The last component was to sing again in front of a ticket-buying audience. When the curtain went up at the International, "He looked great, was in great shape, energized and confident," Sharp says. Well, maybe not as confident as he looked. Comedian Sammy Shore was the opening act, and he distinctly remembers a clammy palm when he shook hands with the star backstage. Elvis won't be back in the building, but Shore -- a Summerlin resident and father of comedian Pauly -- will be at the Hilton on Thursday as part of a fan gathering. Shore's book, "The Man Who Made Elvis Laugh," generates "e-mails from all around the world," he says. Still, when reminded it has been 40 years, he's a little surprised. "That's amazing." Cirque is giving the Beatles "Love" treatment to the King with its still untitled Elvis show set for Aria. Cirque's Web site now carries three short promotional videos, revealing it will be the company's first with "acting moments" spoken in English. In a video clip, director Vincent Paterson notes that after staging tours for Madonna and Michael Jackson, "It seems sort of appropriate that Elvis is next in line." He says that as though Elvis is still alive. And in Las Vegas, that's probably the way it should be.
Historic Westleigh Neighborhood hopes to get recognition
Every time I drive by the historic Westleigh neighborhood I remember my childhood, Paula. She lived with her grandparents in a house on Darmak. We met in sixth grade at the Las Vegas Day School and became fast friends. Most of the other kids in our class came from upper middle class homes where their fathers were doctors, dentists and casino owners. In fact, in our class was one of the "Four Queens", Faith Goffstein. Paula and I were from less ritzy families.
I was reminded of all that this morning as I read about the residents of Westleigh. Many have lived in the neighborhood for years and a number of homes still look the same as they did forty and fifty years ago. The residents are hoping to convince the Historic Preservation Commission to designate it a historic neighborhood.
Our friend, Jack LeVine, has photos of the Westleigh neighborhood when it was first being built:
From the RJ:
Phyllis Wattenbarger came to Las Vegas to be with her new husband, Bill, who had been living here two years. She moved from Dayton, Ohio, where it was green, to Southern Nevada, where it was mostly brown. She arrived in the heat of August. She gave Bill a deadline.
"I told him, 'I'll give you two years to get out of here,' " she said. That was in 1950. Three years later, the couple bought a house on Darmak Drive in the brand-new Westleigh subdivision on the south side of Charleston Boulevard between Valley View Boulevard and Cashman Drive. And they stayed, as did many of their neighbors. Several of the original homeowners still occupy their houses, and children who grew up there have come back to live as adults. Wattenbarger's son, for example, owns three houses in the neighborhood. Many of the houses, too, have stayed close to the same on the outside, enough at least to be considered for a listing on the Las Vegas Historic Property Register. The city's Historic Preservation Commission recommended the listing this week. The Planning Commission will consider it Sept. 24 before it goes to the City Council for final approval. The Westleigh neighborhood represents one of the major booms in population and home building in Las Vegas' history, after the dramatic growth spurred by the Boulder Dam construction in the 1930s and the World War II-era spurt generated by defense spending. Construction stretched from 1951 to 1957 in Westleigh, with most of the homes built in 1953 and 1954. There are 288 properties in the proposed district today, according to a consultant's report. About half are considered historically significant. Commercial properties along Charleston would not be part of the district. In the postwar period, Las Vegas kept receiving federal money because it was a center for Cold War activities. Tourism was growing, and there was tremendous pent-up demand for housing that fueled growth through the 1960s. When the houses were built, subdivisions on the west side of Las Vegas were off on their own, separated by large, empty pieces of land. Oakey was barely a street -- Bill Wattenbarger described it as "two ruts." And his house was the first in the neighborhood to get telephone service, which he needed because he was on call for National Cash Register. Everyone else had to use a pay phone at a nearby grocery store. "Housing was limited. We felt quite fortunate," Phyllis Wattenbarger said. They paid $12,000 for what was then a three-bedroom, one-bath house, and paid $60 a month on the mortgage. "Let me tell you, that was a lot of money back then," she said. Discussion of adding Westleigh to the historic register had gone on for several years, but the push gathered steam a couple of years ago when the neighborhood association decided to organize a push for the designation, said association President Tiffany Hesser, who moved into the neighborhood six years ago. "We bought because of the historic nature of the neighborhood," Hesser said. "It's different. It's not a neighborhood where you have to know the color of your garage door to figure out which house is yours." Architecturally, houses in the neighborhood represent a transitional period between the Minimal Traditional style of the 1940s and the Ranch style home of the 1950s and '60s. Most of the homes were 1,000 to 1,100 square feet. A listing on the historic property register means that standards will be developed for the exteriors of homes, and major changes -- such as an addition or work that requires a permit from the city -- would be reviewed by historic preservation officials to ensure compliance. Some residents are concerned about that extra layer of review and oppose the designation. Of the comment postcards the city received, 46 property owners support the listing and 17 oppose it. Those same concerns existed when the John S. Park neighborhood was put on the registry, said Bob Bellis, a commission member and property owner in that neighborhood, which encompasses an eight-street area on the southeast side of Charleston and Las Vegas boulevards. But the designation helps improve and maintain an area, he said, and at least helps keep property values stable. "They want to keep the whole feel of the neighborhood," Bellis said. Wattenbarger said most people probably won't have to worry about approval for add-ons because in the half-century since the original houses were built, most of them have already been expanded. Her house had a family room, dining room, half bath and back patio and front porch tacked on, while retaining the original windows, inside doors and hardwood floors (which are currently covered by carpet). "I feel it will help the area," she said. "You're not going to have the guy putting the car in the yard and fixing the car. There will be some control."
Lady Luck gets hit with the wrecking ball
The Lady Luck Hotel and Casino in Downtown began demolishing parts of the property today. Shuttered since late 2006, the hotel had promised a major comeback as a boutique destination but the souring economy quickly derailed those plains.
From the RJ:
The CIM Group, a California development company in charge of redeveloping the Lady Luck casino, started tearing down a concrete-and-steel building skeleton at the corner of Fourth Street and Stewart Avenue that Mayor Oscar Goodman recently referred to as a "carcass." He also directed city staff to scrutinize the site for code violations, expressing frustration that nothing had been done on the project for two years. No violations were issued, said city spokesman Jace Radke: "They just worked with the city."
Construction equipment was ripping away at the structure today. CIM Group did not immediately respond to a request for comment. Economic conditions have been blamed for delays in starting the project. The Lady Luck closed in 2006, and CIM bought it in 2007. Last year, the company reached a development agreement with Las Vegas that would give it access to city-owned land around the planned Mob Museum if renovations to the casino started by December. That deadline could be extended.