Deferred Loan Payments Confirm Delay of Plaza Hotel in Las Vegas
- Aug 18, 2008
Groundbreaking on The Plaza Hotel in Las Vegas–would-be sibling to the landmark Manhattan hotel of the same name–has been put off till next year, in conjunction with an agreement by Goldman Sachs Group and Credit Suisse Group to give the project’s developer an additional six months to repay $625 million in loans. A spokesperson for the project’s developer, Elad IDB Las Vegas L.L.C., told CPN that payment on the loans, used toward the purchase of the 35-acre site of the former New Frontier hotel/casino, will now not be expected till May of next year. The developer is a joint venture of Elad Group, New York, a private real estate development company controlled by Israeli billionaire Yitzhak Tshuva, and Property & Building Corp., a subsidiary of Israeli-based IDB Holdings Corp. The project will total 15 million square feet, including 3,500 hotel rooms and 1 million square feet of The Plaza Private Residences. It was originally scheduled to open in 2011; the spokesperson was not certain whether or how much that schedule will be pushed back because of this latest issue. The original Plaza Hotel in New York is owned jointly by the Elad Group and by Kingdom Holdings, Riyadh, Saudi Arabia. As reported by CPN, the hotel reopened in March following a two-year, $400 million renovation. Recently the news has been replete with announcements of projects in and around Las Vegas being postponed. In July, as reported by CPN, the master developer of the 3,600-acre Lake Las Vegas Resort filed Chapter 11, though Lake at Las Vegas Joint Venture LLC has since seen its application for debtor-in-possession financing approved. The project includes a 320-acre man-made lake, three golf courses and more than 1,600 completed residential units. Following an announcement by Boyd Gaming Corp. that it was delaying the $4.8 billion Echelon project because of the troubled economic climate, Morgans Hotel Group Co. withdrew from a joint venture agreement under which it would have developed a Mondrian and a Delano hotel as part of the project. Construction on the 87-acre project began in June 2007 on the site of the former Stardust. The project was originally slated to include 5,000 hotel rooms and suites, including three boutique hotels; a 140,000-square-foot casino; 300,000 square feet of retail; 750,000 square feet of meeting space; 30 restaurants; and two theaters. Even retail is being hit by the downturn. CPN reported last week that General Growth Properties, Chicago, had delayed the opening of its 1.4 million-square-foot Shops at Summerlin Centre regional mall by up to a year, citing a desire to boost the project’s preleasing. The center will be anchored by Nordstrom, Macy’s, Dillard’s, and Crate & Barrel.