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LAS VEGAS-Work is underway for a third hotel tower at the Golden Nugget in Downtown Las Vegas. The $121-million project will add a 25-story tower with street-level retail and gaming below a pool deck, three levels of parking and 524 guest rooms, according to the general contractor, Penta Building Group. Workers are currently constructing and reinforcing pillars that will hold the ground levels of the tower. Completion is slated for December 2009, according to a Golden Nugget spokesperson.

The 25-story tower will feature a porte-cochere entry, opening into a lobby adjacent to several retail stores and slot machine banks, according to Penta. The retail will be anchored by a 3,000-square-foot Chart House restaurant, which will feature a 7,000-gallon salt water aquarium with exotic fish and a custom fabricated reef system.

Levels 2 through 4 of the new tower will be a parking structure with a pool at the second floor, according to Penta. The new pool will tie into the existing pool’s upper deck, above the live shark aquarium. Levels 5 through 24 will have a total of 524 guest rooms. The top level will be the owner’s suite.

Golden Nugget is owned by Landry’s Restaurants Inc., which is being taken private by company founder, chairman, president and CEO Tilman Fertitta. Through Fertitta Holdings, he is paying $1.3 billion for the 61% of the company he doesn’t already own.

In June 2007, Golden Nugget Inc., a subsidiary of Landry’s completed a new $545.0 million credit facility consisting of a $330.0 million first lien term loan, a $50.0 million revolving credit facility, and a $165.0 million second lien term loan. The $330.0 million first lien term loan includes a $120.0 million delayed draw component to finance the third tower.

The company has entered into interest rate swaps for all of the first and second lien borrowings that fix the interest rates at between 5.4% and 5.5%, plus a financing spread, 2.0% and 0.75%, respectively, at June 30, 2008. The Golden Nugget’s subsidiaries have granted liens on substantially all real property and personal property as collateral under the credit facility and are guarantors of the credit facility.

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