The news, released along with its second quarter results, comesone month after Morgans Hotel Group announced that the JV'sdeadline for obtaining construction financing for its piece of theproject had been extended to September 15, 2008. "Given Boyd'sannouncement and the difficulties in the credit markets, MHGbelieves that the joint venture will be unable to secure financingat favorable rates and conditions by [the deadline]," states MHG'sFriday morning announcement. "MHG does not intend to further extendthe joint venture agreement on its current terms but expects toevaluate future proposals relating to the project with Boyd."

Located immediately south of Circus Circus, work on Echelonofficially got underway in June 2007. The 87-acre was slated tohold approximately 5,000 rooms in five hotels, 750,000 sf ofconvention and meeting space, 300,000 sf of retail, two liveentertainment venues, 30 dining and nightlife venues, a 140,000-sfcasino and parking for 8,000 cars.

In April, Boyd announced that foundation work was complete forits three wholly owned hotels on the property -- Hotel Echelon, TheEnclave, and Shangri-La Las Vegas – that steel was being erectedfor the low-rise portion of the development, which encompasses muchof the common area for three of the five hotels, and thatexcavation for High Street, where the retail promenade and meetingcenter would be, was complete and foundation work was wellunderway. The project was on-budget and on-schedule to open in thethird quarter of 2010, the company said.