Canyon Again Seeks Sale of Greek Isles Casino

LAS VEGAS-The main lender on the off-Strip Greek Isles hotel and casino here is seeking bankruptcy court approval to sell the property at auction–exactly what was set to occur when other creditors jumped in and forced the business into Ch. 11 bankruptcy in April. A hearing on the motion is scheduled for July 16.

Greek Isles is a 202-room hotel and casino located on Convention Center Drive between Las Vegas Boulevard and Paradise Road, where much development is planned. It opened in 1972 as the Royal Inn Casino. Marriott International spent upwards of $230 million a couple of years back buying up the block north of Greek Isles for an eventual convention hotel development. Immediately to the south of Greek Isle lies Wynn Las Vegas Golf Course, which also is slated for redevelopment.

The main lender is Canpartners Realty Holding Co. IV LLC, an affiliate of Canyon Capital Realty Advisors that successfully had a court-appointed receiver take control of the property in March. Canpartners said in court that an appraisal shows the property to be worth $44 million, down from $120 million in late 2007. Meanwhile, the borrower now owes $67 million on the $56 million loan that was used to acquire and renovate the property, which is reportedly now $80,000 per month on average, according to Canyon. The lack of owner equity, the casino’s performance, predictions of further declines in value and performance, and the mounting cost of the foreclosure are some of the reasons Canyon is seeking a quick sale.