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Rod Smith
 

Strip Property Up for Redevelopment

19 August 2004

LAS VEGAS -- The little Villa de Flores apartment complex, the subject of an intense legal battle between developer Steve Wynn and hotel owner Mike Flores in the mid-1990s, is again being slated for redevelopment as a hotel and time-share tower.

The Clark County Commission recently approved plans for a 100-foot, 148-room complex on the 0.6-acre sliver of land between The Mirage and Treasure Island, plans identical to those that led to the battle with Wynn.

Flores, who owns the property, said he has a $4 million deal pending in escrow to sell the complex to PRNS Inc., and Wynn is no longer associated with the two hotel complexes, which are now owned by MGM Mirage.

He said the sales agreement had been held up because PRNS did not want to buy the property until a building permit had been issued, a process completed earlier this month.

Flores said he had received expressions of interest in buying the Villa de Flores apartments from MGM Mirage before entering a sales agreement with PRNS President Kevin Ghafouria.

Wynn, when he headed Mirage Resorts, opposed an identical project and offered Flores $3 million for the property, but the recalcitrant owner stuck to his asking price of $6 million.

Wynn refused to take the bait, and successfully sued Flores, his parents, the architect who drew up the plans and the county commissioners who had initially approved the project, leaving the apartment project standing in the middle of the Mirage employee parking lot.

The 1997 lawsuit argued the project would violate county building codes, but Mirage Resorts' attorney at the time, Todd Bice, said Wynn's concerns about the time share were purely practical.

He said the proposed hotel was just too big for the small tract of land and the development would cause traffic problems.

Flores said MGM Mirage recently approached him again about selling.

"They were showing interest in the property again and acted if they would be interested," he said.

Ghafouria, who also owns Nevada One Investment, a Las Vegas mortgage broker company, said he has not decided whether to try negotiating a sale of the property to MGM Mirage.

University of Nevada, Las Vegas professor and casino industry expert Bill Thompson said the dispute between Wynn and Flores was largely personal.

Flores was a friend of Imperial Palace owner Ralph Engelstad, who was notorious for his private collection of Nazi memorabilia, he said.

Flores, at the time of the original dispute, said he could only guess at Wynn's motives for filing the lawsuit.

"Steve Wynn and I have had personal disputes for years," Flores said. "He once says to me, 'Hey Mike, I've got 500 million dollars. How are you going to fight me?' And I says, 'Really, Steve. Why don't you buy yourself a personality?' "

But Thompson said the relationship between the new owner of the Villa de Flores apartments and MGM Mirage will be professional.

"It's good to get it in someone else's hands, so it's no longer personal. They'll settle it out," Thompson predicted.

MGM Mirage spokeswoman Yvette Monet said her company has similar concerns to those Wynn had with the design and location of the project.

"Potential investors should be aware that the building appears to be too large for a 0.6 acre site. There is no direct access from the site to any major street in the resort corridor, no hotel amenities for residents, and the site is surrounded by loading docks and parking areas for both The Mirage and Treasure Island," she said.

"There is also no nearby access from the proposed structure to the public entrances of The Mirage and Treasure Island," Monet added.

Still, pending possible negotiations with MGM Mirage, Ghafouria plans to break ground next year on the $15 million to $20 million project, and he hopes to open his doors to the public within two years.

In addition to the 148 hotel and time-share rooms, the building will include 168 parking spaces, 158 of which are required by code, in a split-level, subterranean garage with 3 1/2 levels.

Plans filed with the county say the structure will be built with colored concrete and glass panels. Guest amenities will include a pool and spa area, recreational uses and a garden area on the roof level.

Ghafouria said, however, his primary interest is in building the hotel and time-share project.

"It's going to be a first-class place," but he said it was premature to discuss further details.

The existing development, which includes one office unit and 35 residential units that are still occupied, will be razed to accommodate the proposed project.