Tuesday, November 21, 2000

By DAVE BERNS
lasvegas.com GAMING WIRE

   LAS VEGAS - The 16-month-old Regent Las Vegas has filed for Chapter 
11 bankruptcy protection, citing as the primary culprits construction 
delays and cost overruns before the property's July 1999 limited 
opening.
   The much-anticipated Tuesday move followed a September default on 
$5 million worth of payments owed creditors that led to restaurant 
closures, the layoff of 259 workers and the departure of a Regent 
president who held his job for just two months.
   In recent weeks, executives of the Summerlin property's parent 
company, Swiss Casinos of America, have been talking with creditors 
to renegotiate repayment of the property's $220 million debt package.
   "Given the late start we had and all the constructions problems I'm 
not sure if it's much of a surprise for anyone," interim Chief 
Executive Officer Darrell Luery. "In a way it shouldn't mean 
anything. On the other hand ... it could be a very good thing with 
all of the debt restructured."

    The Regent will remain open, and no layoffs are planned, with the 
property's work force having been reduced from a high of 1,700 to 
1,200 following the late October firings.
   "They should've done a mass layoffs earlier," said valet James 
Dolan. "We were grossly overstaffed.
   "I don't think there's anyone worried about this. It's more a 
protection than anything."
    The privately owned Regent, which opened as The Resort at 
Summerlin, lists assets of $296.4 million against liabilities of 
$365.8 million, according to the U.S. Bankruptcy Court filing.

   Chapter 11 is the most common form of bankruptcy and frees a 
company from the threat of creditors' lawsuits while it reorganizes 
its finances.
   Any reorganization plan must be accepted by a majority of the 
Regent's creditors. Unless a bankruptcy judge rules otherwise, the 
Regent's management team will remain in control of the business and 
its assets.
   The high-end property operated by a company owned by Swiss 
businessman Hans Jecklein opened with 286 of its 541 hotel rooms in 
July 1999, two of its nine restaurants and no health spa or pool 
despite having marketed itself as a golf-spa getaway. Operators say 
it wasn't fully open until early this year.

   Its owners have since sued general contractor J.A. Jones 
Construction because of what the plaintiff characterizes as the cost 
overruns and construction delays.
   Swiss Casinos of America designed the upscale hotel-casino as a 
vacation spot for well-heeled travelers who frequent vacation hot 
spots in Southern California and Arizona.
   But critics argued that the property's business plan miscalculated 
the Regent's ability to lure vacationers from the megaresorts of the 
Strip,  where 3,000- to 5,000-room giants operated by mammoth 
companies possess the benefits of Las Vegas geography, extensive 
casino marketing lists and highly developed hotel reservation systems.
   "Initially the property's marketing was a little snobbish," said 
nationally known restaurateur Gustave Mauler, who operates Oxo and 
Spiedini Ristorante at the Regent. "They wanted to emphasize 
five-star service, and they were even too snobbish to call their 
buffet a buffet."

  Luery, a former Bally's Las Vegas boss who also serves as the vice 
chairman of the Regent's board of directors, said he will continue 
the recent effort to reposition the operation as a locals' gaming 
property to compete with the offerings of Station Casinos and Coast 
Resorts.
   "We've got all these people in the Summerlin market," Luery said. 
"That's where we're going to focus now the base of our business."
   In response, Regent operators plan to lower the casino's minimum 
blackjack hands from $5 to $2 or $3, and will open a coffee shop and 
bingo area.
   Observers wonder whether value-driven local customers will flock to 
the property with its high-priced reputation, especially since the 
September opening of Coast Resorts' neighboring SuncoastSundance 
hotel-casino.
   The Regent is also seeking increased banquet and convention 
business to boost its bottom line.
   "You have to do two things," said a Wall Street source who sought 
anonymity. "You've got to bring in groups that are having a business 
function that aren't so concerned about the gaming floor ... and you 
have to change your restaurant product for locals to get people at 
the right price."

   Meantime, Station Casinos, billionaire financier financier and 
casino owner Carl Icahn and Desert Inn owner Steve Wynn are believed 
to be on the sidelines, considering possible purchases of the 
property.  Icahn owns the property's bank debt and is believed to 
hold a portion of its bonds.
   "Clearly that's one of the options," a knowledgeable source said of 
a sale. "The first challenge is working with the court to do the 
things that need to be done, to get it on solid financial footing."
 

las vegas.com GAMING WIRE writer Jeff Simpson 
contributed to this report.
 

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