Las Vegas' SLS Hotel is Spending Generously, Despite Parent Company's Promise to Support Its Finances
SLS Las Vegas is currently experiencing a losing streak that no one wants to be a part of in Sin City: a string of losses. For the sixth consecutive month, the property, which once stood on the site of the former "Rat Pack" Sahara Hotel & Casino, has been in the red, with the second quarter racking up $48.6 million in losses and a total of $83.9 million for the year 2015.
According to SEC filings from its owner, Stockbridge/SBE Investment Company, LLC - a joint partnership responsible for overseeing the proprietorship of the Las Vegas property - the hotel and casino sustained net losses as well as negative operating cash flows due to "substantial debt," "factors beyond our control," "extensive regulation and licensing," and "general business and competitive conditions." Despite the significant financial setbacks, the company invested an additional $40 million this year in addition to the $415 million they initially spent renovating the former Sahara into the SLS.
However, the arm of the partnership that owns 90% of the shares, Stockbridge, stays optimistic, encouraging a patient approach by declaring they're in it "for the long haul."
SLS's Sour Reputation
Unfortunately, the public's reception to the SLS revamp hasn't been warm and welcoming. With the controversial "Happy Blob" statue, an ode to Sam Nazarian, chairman of SBE, causing confusion before guests even enter the hotel, the mixed vintage-modern aesthetic previously praised is now overshadowed by an increasingly dire financial situation and deteriorating service.
The general consensus on Yelp, with more than 1,000 reviews, is represented by an average rating of 3 out of 5 stars, the same as Google critics. While the criticism has been a bit blunter for others.
"Where's the appeal of visiting the SLS? They only have gambling as a main attraction," noted a visitor on Las Vegas Review-Journal's website.
Google reviewers were just as merciless.
"Hey SLS: 1965 and 2014 are an incompatible pair. You can't improve an ugly pig with lipstick."
"This hotel was abysmal. The room provided for me felt like a prison cell, with concrete walls painted gray."
"Upon entering my non-smoking room, I was suddenly engulfed by a strong cigarette smell."
Although not every visitor's experience with the hotel was negative, the overwhelming sentiment on the latest reviews is of a struggling establishment that isn't meeting anyone's expectations.
Facing Challenges
The location of SLS is proving a double-edged sword. Although it's situated in a prime spot at the intersection of Sahara and Las Vegas Boulevard, the resort's neighbors include the now-defunct Riviera, once a popular casino, and the Fontainebleau, a bankrupt resort unfinished since 2009. Across the street is an empty lot that will one day house Resorts World Las Vegas - though progress on construction remains slow.
It's safe to say that foot traffic is sparse.
SLS has its share of challenges ahead, but the ownership remains resolute. "We're investing in marketing and advertising to raise awareness of the SLS brand and attract new customers," the SEC filing stated.
Whether this is what's called "chasing" in gambling parlance - or a desperate attempt at finding any sort of profit - remains to be seen. It depends on how deep Stockbridge/SBE is willing to dig into their pockets for any financial gain.
Read also:
- The CDU is pushing for additional medical study positions in Homburg.
- US director Baker wins Palme d'Or at Cannes, while Iranian filmmaker Rasoulof receives Jury Prize.
- German enthusiast creates gigantic Harry Potter figure
- Lautern coach Alonso alters his lineup five times, with Ache left out.
Source: www.casino.org
