Home » VT News » Starwood Takes Over Riviera : Updated

Starwood Takes Over Riviera : Updated

By Chuckmonster on Wednesday, 14th July 2010 12:03pm
  » filed under Mergers & Acquisitions  comments: 3

   

As has been rumored for a few months, the Starwood Capital Group - a private investment firm which originally funded, but now does not own Starwood Hotels & Resorts - is poised to take over majority control of the Riviera under terms of the bankruptcy proceedings which came to light yesterday.

The Las Vegas Sun is reporting terms of the deal - SCG and other investors will exchange debt holdings into controlling stake in the Riviera Las Vegas and the Riviera in Black Hawk, Colorado. The debt swap relieve the Riviera of $220M in debt and provide financing for property upgrades.

While CEO of Starwood Hotel Group (who once owned Caesars Palace), Barry Sternlicht orchestrated the sale of The Desert Inn to Steve Wynn in 2000.

Update: Thanks to the genii at Hotel Chatter for tweet pointing out that Starwood doesn't own Starwood anymore.








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Comments & Discussion:

Starwood really needs to pump some money into rennovations or the Riv is going to be a money pit. I think the LVS article indicated only $30M, which may not even be enough operating capital to keep the doors open. Based on what the Trop is doing, they are going to need at least $250M.

The Riv was in the process of renovating their rooms when the economy tanked and they shelved any further renovations until things got better.

The Riv is in a bit of a bad spot right now with the stalled projects in the area (Fontainebleau, Echelon) plus the vacant lots of a number of canceled projects in the area. Much of the hope in revitalizing the Riv hinged on the redevelopment of the North Strip, which is delayed for a few more years.

so the place is still on a sort of life support? if they finish renovating the rooms hen this may work out but i would bet turning the Riv into a 'go to' place may not happen for a long while.



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