Hurley Reed, MPTV's CEO, said in the company's announcement that the company hopes to begin the renovation project "as soon as our funding closes," but did not mention the amount of funding. MPTV filings earlier this year with the Securities and Exchange Commission, however, said the company was seeking a $13.44 million construction loan.
MPTV has been working on its Lake Tropicana Las Vegas timeshare resort since 1994 thanks to financial and permit problems delaying the project's completion. In 1997, MPTV resumed work on the resort through a joint venture (Lake Trop LLC) with All Star Resorts. In 2000, MPTV bought All Star's interest in the property, regaining 100% ownership.
Two months ago, MPTV announced that it had received a commitment to refinance its current mortgage on Lake Trop for $9.5 million. Approximately $6.5 million of this funding will be used to refinance the current mortgage and the balance of $3 million will be used to commence Phase I of the Lake Trop renovations. When the financing is complete, new construction will begin, say company representatives.
Lake Tropicana Timeshare Resort and Towers is planned for a 7.5-acre site in Las Vegas between the MGM Grand Hotel-Casino and the Aladdin Hotel-Casino on the Vegas strip and the Hard Rock Cafe on Paradise and Harmon avenues. The resort is planned to include 144 apartments in 22 buildings, a tennis court, a spa, swimming pools and other recreation facilities. It is one of a number of projects along Harmon, where two new casino hotels and three large timeshare projects are planned.
MPTV's recent SEC filings, however, raise doubts about the company's future. Its latest quarterly report says it has incurred cumulative net losses of $54.3 million since its inception in October 1992 and is in default on certain secured and unsecured notes. Its quarterly financial report filed in May said these factors "raise substantial doubt about the Company's ability to continue as a going concern."
MPTV acquired the Lake Tropicana property through its merger with Consolidated Resort Enterprises Inc., which acquired the property from Glen Ivy Resorts Inc., a national timeshare development company that lost Lake Tropicana in a Chapter 7 bankruptcy.
MPTV says the renovations are needed to remodel the property "to appeal to family-oriented visitors to Las Vegas." Plans for the first phase of renovations call for transforming 40 existing units at the site into two-bedroom suites with upgraded features, plus other exterior renovations that will take three months to complete.
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