Reno Firecreek Casino closes due to difficult financing climate
Elevation Entertainment has put plans for its Firecreek Crossing Resort casino in Reno on hold, citing a difficult financing environment.
The news comes a year after the company announced plans for the site. Firecreek Crossing Resort Casino will be Reno's newest casino, following the opening of Legends Bay Casino in Sparks last year. Legends Bay is the first brand new casino in Sparks in nearly three decades.
We like Reno, but given the difficulties in financial markets, we are holding off for now. When the time comes, we hope to bring a best-in-class product to market. ” Elevation said in a statement to Fox 11.
The company owns several commercial and residential real estate projects, including two gaming venues in California. Elevation operates the Seven Mile Casino in Chula Vista in San Diego and the Rolling Stone Casino in Sacramento.
Firecreek casino plan aligns with macroeconomic realities
Elevation did not disclose the estimated price of the Reno casino-hotel development. Nonetheless, Legends Bay cost $120 million to build, and other properties on the market are trading for closer to $200 million.
Elevation needs financing to bring the Firecreek Crossing Resort casino back to life, and with interest rates near their highest level in two decades; now is not the right time for the company to raise significant capital. Additionally, Elevation is privately held, meaning it's impossible to sell shares on the public market and difficult to raise cash through the debt markets.
Adding to developers' concerns is rising default rates on commercial real estate loans, prompting banks to become more stringent about lending for new large-scale projects. The situation is even more acute for smaller borrowers like Elevation, which are seeking financing in a market that banks view as vulnerable to a recession. Reno meets these requirements.
If ultimately built, Firecreek Casino will have 201 rooms, 48 suites and a casino; Firecreek will feature a lobby bar, beer garden, several restaurants, a food court and a park.
The Checkered History of Firecreek Casino Site
If the Firecreek Crossing Resort casino eventually opens, it will be located near Kietzke Lane and South Virginia Street, a site that was previously the site of a failed gaming venue proposal.
Prior to the coronavirus pandemic, Station Casino parent company Red Rock Resorts was eyeing nearby development projects. The global health crisis has hampered these efforts.
The property where Elevation plans to build Firecreek is currently vacant and used as the site for a December Christmas tree sale. There is nothing to talk about for the rest of the year.
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Source: www.casino.org
