FXRE Principal Stockholders Up Stakes

LAS VEGAS-The Huff Alternative Fund and Robert F. X. Sillerman, principal stockholders of Strip-front landowner FX Real Estate and Entertainment Inc., recently increased their stakes in the public company through FXRE’s previously announced and currently pending rights offering. Huff purchased 1.15 million shares of FXRE common stock for $10 per share while Sillerman, FXRE chairman and chief executive, acquired just over 3 million shares at the same per-share price.

Initiated in in February, the rights offering gave stockholders the right to purchase for $10 one additional share of company stock for every two shares they held as of March 6. Holders of approximately half of the company’s 40 million outstanding shares waived their right to participate in the offering, but FXRE chairman and chief executive Robert F.X. Sillerman and the Huff Alternative Fund LP have agreed to purchase shares that are not otherwise subscribed for the rights offering. As a result of the “backstop” agreements, the company expects to sell all of the shares being offered in the offering, resulting in gross proceeds of $98.7 million. The rights offering expires April 11.

FX Real Estate and Entertainment’s main asset is 17.7 acres at Harmon Avenue and the Las Vegas Strip known as the Park Central site, which is currently occupied by a motel and several commercial and retail tenants. In July, FX paid Africa-Israel Investments Ltd. $180 million for the 50% interest in the property it did not already own. In an annual filing this month, the company detailed a $3-billion redevelopment plan that includes 3,047 hotel rooms, a 93,000-sf casino and 94,000 sf of retail for the 17.7-acre site located across Las Vegas Boulevard from MGM’s $7.4-billion Project Citycenter, which is well under construction and scheduled to open in late 2009.