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Larco Investments to Buy Bankrupt Regent Las Vegas; Anticipates Replacing the Regent Brand with the JW Marriott Label
By Jeff Simpson, Las Vegas Review-Journal
Knight Ridder/Tribune Business News 

Nov. 20--Hundreds of workers at the Regent Las Vegas have lost their jobs in recent days, clearing the way for today's scheduled sale of the bankrupt Summerlin hotel-casino to a Canadian company. 

Hotspur Resorts is set to assume control of the 541-room gaming property at midnight and is expected within a few weeks to replace the Regent brand with the upscale JW Marriott label. 

The layoffs were a condition of the $80 million purchase by Hotspur parent Larco Investments, a Vancouver, British Columbia-based company, which owns hotels and a shopping mall in Canada. 

"The ones that we'd like to rehire have by and large been notified," Larco Senior Vice President Thad Alston said. 

A federal bankruptcy judge approved the deal in September as property developer Swiss Casinos of America agreed to sell the deeply troubled gaming complex for much less than the $366 million the company had spent to develop the 54 1/2-acre high-end property. 

Originally opened as The Resort at Summerlin and plagued by construction delays and a flawed business plan, the ultrachic property failed to lure the upscale gamblers and hotel guests it needed to succeed at its setting about 10 miles northwest of the Strip. 

The hotel-casino consistently generated negative cash flow throughout the bankruptcy process, which began in November 2000. 

Marriott International's JW Marriott is expected to be a more powerful driver of foot traffic than the Regent name, which is well-known in Asia but not the United States. 

"The JW Marriott affiliation makes sense," said Harry Curtis, a Robertson Stephens financial analyst. "The key is to be able to use the Marriott reservation system and drive people into the rooms." 

The Bethesda, Md.-based company has a corporate policy against direct ownership of gambling businesses. Marriott family members belong to the Mormon Church, which opposes gambling. 

But New Frontier owner Phil Ruffin operates a Marriott franchise in the Bahamas that has a casino. 

In the late 1990s, Marriott considered building a hotel without a casino on the east side of the MGM Grand acreage, but that project fell by the wayside. 

Larco's Alston declined to comment about the addition of the JW Marriott brand, and a Marriott International executive failed to return a phone call seeking comment. 

The Regent had an estimated 1,400 employees last spring, said Lanis O'Steen, the property's chief restructuring officer. That figure is now closer to 1,200 people, with about 1,000 of them expected to be offered jobs by Hotspur. 

About five Regent executives and managers are expected to lose their jobs in the staff restructuring, O'Steen said. 

Hotspur Resorts executive Alan Kerslake did not return five Monday phone messages seeking details about the job cuts. The company is owned by British investor Shiraz Lalji, who is one of Larco's top investors. 

Hotspur will operate the property's hotel, but Swiss Casinos executives will continue to run the gaming operations for the short run. 

The Nevada Gaming Commission on Monday gave veteran Las Vegas casino executive Bill Paulos permission to familiarize himself with the casino's operation, paving the way for his Millennium Management to assume control of its daily operations by as early as mid-January. 

"We'll be making some dramatic changes in and around the casino," said Paulos, who previously oversaw the 1989 opening of Excalibur and the 1993 opening of Luxor. His company now manages Detroit's Greektown casino. 

Among the possible changes: the additions of a cafe and fast-food restaurants next to the casino, as the property tries to lure greater numbers of local gamblers. 

-----To see more of the Las Vegas Review-Journal, or to subscribe to the newspaper, go to http://www.lvrj.com. 

(c) 2001, Las Vegas Review-Journal. Distributed by Knight Ridder/Tribune Business News. MAR, MGG, 


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