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Deposit Keeps $225M Hooters Hotel Sale Alive

LAS VEGAS-The hotel owner says it accepted the $1.5-million non-refundable payment despite it being paid 11 days late.

By Brian K. Miller | Updated on November 27, 2007

LAS VEGAS-The $225-million sale of the Hooters Hotel & Casino here remains on track thanks to a $1.5-million non-refundable deposit payment from the buyer, Hedwigs Las Vegas Top Tier LLC, an affiliate of the investment group led by NTH Advisory Group LLC. The seller, 155 East Tropicana LLC, says in an SEC filing this week that it accepted the payment despite it being 11 days late.

Formerly Hotel San Remo Casino and Resort, Hooters Casino Hotel is located one-half block from the intersection of Tropicana Avenue and Las Vegas Boulevard. Reopened as Hooters in February 2006, the property has been unable to achieve the average 95% hotel occupancy rate that is typical of Strip and near-Strip resorts, though it has been on the rise. Occupancy averaged 87.9% in the third quarter, up from 80.7% in the third quarter of 2006, according to SEC filings.

The agreement calls for Hedwigs to pay $95 million in cash for the 696-room property as well as assume $130 million of 8 ¾% Senior Secured Notes due 2012. In addition, the seller has agreed to lease back the casino operations for $540,000 per month until the buyer is properly licensed.

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