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Benjamin Spillman

Lady Luck remains shuttered

8 February 2007

LAS VEGAS, Nevada -- A hotel-casino that was supposed to become "the anchor of the downtown market" remains shuttered almost one year after its owners closed the property and displaced nearly 700 workers.

When the Lady Luck closed Feb. 12, 2006, its owners said renovations would be complete within nine to 12 months.

On Nov. 1, Andrew Donner of Downtown Resorts told the Nevada Gaming Control Board the project would be delayed a year but pledged to reveal plans for the project, "in the next 30 days."

But city officials in Las Vegas, which has an exclusive negotiating agreement with Donner and Downtown Resorts for a 5.5-acre property just north of the Lady Luck, say the renovation is on hold because the financing fell through.

"It's on a complete hold while they get financing," Mayor Oscar Goodman said last week.

Goodman added that the Lady Luck principals had an "optimistic message that they shared with me" about their future prospects, but he wouldn't be specific.

Donner did not return several calls for comment. An automated "renovation hot line" listed on Downtown Resorts' Web site disconnects callers.

City officials are concerned about the Lady Luck because Donner had suggested buying the 5.5-acre property surrounding the old post office on Stewart Avenue for a future expansion that could include hotel rooms, housing and retail development.

Downtown Resorts still has an exclusive negotiating agreement with the city for the site. The agreement has been extended three times, said Scott Adams, director of the Las Vegas Office of Business Development. The latest extension continues through April, 18 Adams said.

"Before we go any further with them on anything, we want to see a credible plan," Adams said.

First opened as Honest John's in 1961, the Lady Luck took its current name in 1968. It was expanded in 1972, 1982 and 1985, according to Downtown Resorts' Web site,

It has had three owners since then, including Downtown Resorts, which bought the property in April 2005 under the name Henry Brent Co.

In June, Canyon Capital of Beverly Hills, Calif., loaned Downtown Resorts $66 million for the renovation.

At the time Canyon Capital Principal Jonathan Roth said, "The Lady Luck will serve as the anchor of the downtown and its modernization signifies the exciting transformation taking place in downtown Las Vegas."

But there has been little activity at the property. A side building at Stewart and Fourth Street was gutted, but the main towers look largely the same as when they closed.

Las Vegas Building Department Director Paul Wilkins said the owners haven't received any new permits since the demolition permit, which was issued more than six months ago.

"In my estimation that project has just sort of fizzled out," Wilkins said.

Review-Journal writer David McGrath Schwartz contributed to this report.