Colony craps out again

Gaming’s Mr. Magoo, the disaster-prone CEO of Colony Capital, Tom Barrack has done it again. The Las Vegas Hilton has defaulted on one of its loans (again), a too-familiar revelation where a Colony-owned property is concerned. Although it lost $1 million less last quarter than a year earlier, that’s still $8.9 million in red ink. Players are playing less (casino revenue down 9%), stayers are staying less — or at least paying less for their Hilton rooms. They’re certainly eating less. Now that Caesars Entertainment has snatched the annual Star Trek convention away from the soon-to-be-ex-Hilton, the third-quarter numbers are likely to be pretty ugly, too.

Meanwhile, Barrack goes cap in hand to other hotel brands, looking for a name to replace “Hilton” on the oversized marquee. More ominously still, money that was earmarked for interest payments was diverted into the operating budget, to keep the doors open. Not good. Not good at all. There’s also trouble in the casino’s incompetently marketed entertainment slate, where — surprise, surprise — “ultra-magician” Steve Wyrick is having some ultra-problems with his newest smoke-and-mirrors act.

\Barrack could use some “ultra-magic” with his balance sheet. He seems to mistake the casino industry for a Monopoly board, acquiring hotels for the purpose of borrowing against them. Hence the trail of disasters in his wake. All of which means that he will do what he always does: try to restructure his debt. Perhaps Barrack’s lone stroke of genius was to sell a big chunk of the LVH to Goldman Sachs. (Goldman, however, may not be thinking it was such a bright idea to get into bed with Barrack.) The latter’s presence might explain why banks have shown so much forbearance toward the Hilton even as they lost patience with Barrack’s fiscal ass-clownery elsewhere.