History
The Shenandoah Hotel began as a $29 million project, named after the Las Vegas estate of minority investor, singer Wayne Newton. The hotel had opened by May 1980, but the casino opening was delayed by a Gaming Commission investigation into hotel president John Harlow Tucker for a 1975 securities fraud conviction. Tucker's license was ultimately denied, and he was ordered to sell his $1.8 million in shares. Newton also pulled out, instead buying The Aladdin. The hotel's landlord, Allarco Holdings of Edmonton, took over, and sought new investors to buy or lease the property, which was losing $500,000 a month.
Allarco was acquired in January 1981 by Carma Developers Ltd., a Calgary-based real estate company. Carma spent over two years trying unsuccessfully to sell the Shenandoah, before deciding to seek a gaming license to open the casino itself. Nevada passed a law in June 1985, making it possible for Carma to become the first foreign firm to receive a gaming license in the state. The property was reopened and rebranded as Bourbon Street Hotel and Casino.
In January 1988, Carma sold Bourbon Street to Las Vegas Investors Ltd., a firm run by two top executives of Hotel Investors Trust (now Starwood Hotels). The following month, the firm turned around and sold the property to Hotel Investors Trust, along with the King 8 Hotel, for a total of $35 million.
An agreement was announced in July 1995 to sell the property to Crown Casino Corp. for $10 million. However, Crown abandoned the deal in November, losing a $500,000 deposit, citing the possibility of more attractive opportunities, a lack of attractive financing, and declining profits at the property.
In August 1996, Starwood sold the property to Tarsadia Hotels for $7.8 million in cash plus $1 million in assumed debt. Starwood cited a strategic focus on "full-service, high-quality hotels." Tarsadia closed the property's casino and laid off its 400 workers, avoiding the complication of applying for a gaming license for its owner, Tusher Patel, who was not a U.S. citizen. Patel planned to build a timeshare tower on the site, in partnership with an unidentified major casino company, but the plan was scrapped when the partner pulled out.
In August 1997, Tarsadia agreed to sell Bourbon Street to Florida Gaming Corp., a jai alai operator, for $13 million in cash plus $1.5 million in stock. The near-doubling of the hotel's value in the span of a year was attributed to rising property values on the Strip. Florida Gaming planned to spend $6.5 million renovating the site. However, the sale was never completed.
In April 2001, Tarsadia sold Bourbon Street to a partnership of Dallas-based real estate investor Michael Block, and the Red Sea Group of El Segundo, California, with a declared property value of $11 million. With the property losing money, the partners immediately began discussions to redevelop or sell it.
In 2003, Block began negotiating with Trevor Pearlman and Reagan Silber of Edge Resorts. Block bought Red Sea's stake in the partnership for $10.55 million and sold it to Pearlman the same day for $12.5 million. Four months later, Block sold his stake to Silber for $14 million. Block had not informed Red Sea of his negotiations with Edge, leading Red Sea to successfully sue Block.
Edge Resorts planned to build the W Las Vegas condo-hotel project on the site, in partnership with Starwood. However, even after buying an adjacent apartment complex, bringing the site to 8 acres total, they decided they needed more space, and bought a 21-acre lot on Harmon Avenue.
Edge sold Bourbon Street and adjacent properties to Harrah's Entertainment in March 2005. Records filed with the county listed the total property value at $60.6 million.
Harrah's decided to close Bourbon Street effective October 31, 2005.. On October 18, however, a water main broke, threatening the building's structural integrity, and the property closed early. Demolition work began the following January, and the tower was imploded on February 14, 2006.
Between 2005 and 2007, Harrah's had consolidated control of much of the east side of the central Strip, also acquiring the Imperial Palace, Barbary Coast, and much of the residential Flamingo Estates neighborhood north of Bourbon Street. CEO Gary Loveman envisioned a mega-resort called Epicentre for the company's 350 acres. As of 2012, the plan has not materialized, and the Bourbon Street site remains vacant.
Read more about this topic: Bourbon Street Hotel And Casino
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