X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

LAS VEGAS-Boyd Gaming stated in its quarterly report this week that construction probably will not resume in 2009 for its delayed $4.8-billion Echelon development on the Las Vegas Strip. Boyd’s first project on the Strip, the 87-acre integrated resort was scheduled to open in late 2010 with 5,000 rooms in five hotels, 750,000 square feet of convention and meeting space, 300,000 square feet of retail, two live entertainment venues, 30 dining and nightlife venues, a 140,000-square-foot casino and parking for 8,000 cars.

Work on Echelon officially got underway in June 2007. The company halted construction on Aug. 1, saying it hoped to resume construction in nine to 12 months.

“Due to the continued deterioration in credit market conditions and the economic outlook, it is unlikely that we will resume construction in 2009,” the company stated in its 10-Q filing this week. “Nonetheless, we remain committed to having a meaningful presence on the Las Vegas Strip.”

Instead of resuming construction, Boyd says it will spend 2009 preparing alternative development options for the site. The options likely to be considered include developing the project in phases, alternative capital structures for the project, scope modifications to the project, and additional strategic partnerships.

“It will take several months to develop and consider the full range of options and it will take several more months to properly evaluate these options against the back drop of the conditions in the credit markets and the conditions in the broader economy,” Keith Smith, the company’s president, chief executive and director said in a recent conference call. “We will update you when we have a more definitive strategy on how and when we will move forward.”

Its initial development partners for the project aren’t expected to be involved if Boyd ever resumes on the project. Its agreement with Morgans Hotel Group Co., which was to help develop two of the hotels, was gutted in September and now allows for either side to terminate the deal by the revised financing deadline, which is now December 2009. Its agreement with financially beleaguered General Growth Properties for the retail component was dissolved last month.

As of the end of September, Boyd had spent $525 million on the project and expected to spend an additional $150 million over the next two quarters on items primarily related to steel fabrication.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.