Question of the Day - 16 April 2024

“Don’t look now, Las Vegas, but we may have another ‘failsino’ on our hands,” reported David McKee, our Stiffs & Georges columnist on March 21, 2023. One-plus year later, it looks even more that way.

At the time Dream was rudely awakened, Fort Lauderdale-based Shopoff Realty Investments promised it had “every intention to complete this project as planned.” If completed, it would encompass 531 rooms, casino, two restaurants, showroom, nightclub, and pool/dayclub complex.

Shopoff said it was in “active discussions” with potential lenders, having spent roughly $175 million on the $575 million project and on the hook for as much as $30 million in debt.

CEO Bill Shopoff told the Las Vegas Review-Journal he would have the requisite financing in hand “in the next couple of weeks.” That was over a year ago. Since then, crickets. And maybe some tumbleweeds.

Dream Hotel Group parent company Hyatt has, tellingly, not lifted a finger to rescue the project. 

Several factors raise question marks about Dream. For one, the casino would have been farmed out to Peninsula Pacific Entertainment. Except that PPE no longer exists, its assets having been swallowed up by Churchill Downs.

As for the modest number of hotel rooms, that was dictated not only by the size of the plot (south of the Pinball Museum and north of a motorcycle dealership), but also by height restrictions from being cheek to jowl with Reid International Airport. One Dream executive explained that the rooms were essentially "amenities" for the food and beverage operation. That business model in Vegas already failed at SLS (the once and future Sahara).

Since the piles for Dream have been driven and the foundation laid, the site is currently problematic. It’s no longer a pure real estate play, should Shopoff want to cut its losses and get out. And any potential buyer would have either to engage in an expensive excavation or build something dictated by Dream’s footprint.

There’s a precedent for Plan B, as you mentioned: the former Echelon Place, now Resorts World Las Vegas. Of course, the four-story steel skeleton that was as far as Echelon got is still rusting in place behind one of Resorts World's parking garages, perhaps as a reminder to any potential new developer.

Still, a hotel-casino on the Dream site isn't out of the question, provided someone can come up with at least $400 million.

Any takers?