Construction work on Strip hotel-casino Dream Las Vegas has “fully stopped,” according to local media, as the developers’ stalled financing plans left them owing tens of millions of dollars for the project. Dream, on Las Vegas Boulevard just south of Russell Road, broke ground last year.
Completion of the project is seemingly facing major obstacles. Dream developer Bill Shopoff told the Las Vegas Review-Journal that he owes approximately $25 million to $30 million for work on the resort, and that construction “will restart once the terms of the financing are finalized.”
“Work has fully stopped at the site, other than anything required for safety,” Shopoff, president and CEO of Shopoff Realty Investments, said in a statement Monday. Shopoff said his group is in “active” discussions with its lender and expects terms to be finalized in the next couple of weeks. “Clearly, we’re delayed on getting some financing,” he said in a recent interview.
Dream Las Vegas is set to offer a smaller, boutique-style experience in a corridor dominated by huge hotel-casinos with thousands of rooms apiece. Shopoff and real estate firm Contour, led by CEO David Daneshforooz, are partners on the project.
Dream Las Vegas' groundbreaking last year
Dream Las Vegas is slated to cost $550 million to $575 million, up from an earlier $300 million estimate. Owners have been paying for the project with cash so far, and are working on a $400 million-plus funding package. Review-Journal points out Shopoff said his team is in daily contact with Dream’s lead builder, contractor McCarthy Building Companies, and the project’s ownership group “fully intends” to honor its agreements, pay its builders and finish the resort.
Developers had a term sheet from a lender last summer when they broke ground on the resort, but closing the deal has taken longer than expected. Shopoff pointed to last year’s interest rate hikes by the Federal Reserve and recent turmoil in the banking industry. He figured his team is two to four weeks from completing its financing, which would get the project back on track.
Roughly 1,200 construction professionals were slated to work on-site for the project, according to plans shared last July. A lien notice recorded on March 10 and signed by McCarthy Senior Vice President Ross Edwards stated that about $43.3 million in payments had been received, but highlighted that almost $40.2 million was “currently due for work performed.”
County records indicate that several subcontractors on the project, including electrical, steel and drilling companies, have filed lien notices as well, reports Review-Journal, which also highlights before its funding issues Dream faced plenty of hurdles.
Plans for the resort were unveiled in February 2020, one month before the Covid-19 pandemic, and officials were later forced to make design changes after facing concerns of possible illegal drone flying and bombs hidden in garbage trucks due to Dream’s location next to Las Vegas’ airport. Moreover, company officials later discovered the pinball arcade next door was encroached by “at least eight feet” on Dream’s property, which led to a lawsuit, now resolved.
The resort is slated to be operated by New York City-based Dream Hotel Group, which was recently acquired by Hyatt Hotels Corp. When Hyatt announced the buyout last fall, it said it was paying a base price of $125 million, with up to an additional $175 million over the next six years “as properties come into the pipeline and open.” At the time, Shopoff said there were no changes to the Las Vegas project’s name, timing or programming as a result of the takeover.
Dream Las Vegas is set to feature a 21-story luxury hotel featuring 531 guestrooms, seven dining and nightlife venues — one being a rooftop pool deck — a 12,000 square-foot convention center, spa, and small casino floor.
Original article: https://www.yogonet.com/international/news/2023/03/21/66534-dream-las-vegas-hotelcasino-sees-construction-halted-amid-stalled-funding-plans
