Mona Shield Payne / Special to the Sun
Monday, June 29, 2009 | 1:11 p.m.
- Another golf course to close at struggling Lake Las Vegas (6-25-2009)
- Lenders seek control of Lake Las Vegas hotel (6-4-2009)
- Residents of bankrupt Lake Las Vegas face uncertainty (3-23-2009)
- Lake Las Vegas can abandon golf course, judge says (1-15-2009)
- Amid the decline, decadence for the feet (1-5-2009)
- Judge: Lake Las Vegas golf course should be shuttered (12-22-2008)
- Resort golf course’s fate spurs debate (12-16-2008)
- Never spoil a good party with talk of a recession (8-29-2008)
- Bridge over troubled water (5-24-2008)
Map of Lake Las Vegas Resort
1600 Lake Las Vegas Pkway, Henderson
Lake Las Vegas will close its second and last public golf course, Reflection Bay, tomorrow after a federal bankruptcy judge granted permission this morning to do so.
The move will leave the troubled resort with just one golf course, the private SouthShore Golf Club.
After a brief hearing that drew no objections, Judge Linda B. Riegle ruled that “there is no equity left in (Reflection Bay) and it is, in fact, a burden,” thereby meeting the legal requirements for Lake Las Vegas to abandon the course and allow it to enter foreclosure as part of its bankruptcy reorganization.
Riegle also gave the resort until July 17 to file its bankruptcy plan, which is the document that shows how it plans to work its way out of bankruptcy.
It is the sixth time the plan’s due date has been extended. Attorneys for Lake Las Vegas said the plan is the subject of ongoing negotiations with the resort’s creditors, and cautioned that they may request a seventh extension next month.
Lake Las Vegas, which has been going through bankruptcy reorganization since July 2008, will keep a skeleton crew at Reflection Bay to maintain it and count inventory until July 9, when creditor Carmel Land and Cattle Co. is scheduled to foreclose on it.
Like the resort’s other foreclosed course, The Falls, the fate of Reflection Bay remains up in the air. It is not known how long the course will sit vacant and, if it is bought, whether it will be re-opened as a golf course or plowed under for other development.
Today’s hearing was starkly different from an earlier request to abandon The Falls, for which Carmel was also the primary lender. That request drew objections from several of the creditors involved in the proceedings, who said the course still had value and its abandonment would hurt the resort’s chances for recovery.
The Falls’ request required two extensive hearings and dozens of filings before Riegle gave the resort permission to abandon the course. Attorneys representing the creditors’ committee -- the group of companies and lenders that are owed money by the resort -- declined to comment on why they didn’t oppose the Reflection Bay abandonment.
Court filings, however, shed some light on the subject. Carmel has made four cash loans to Lake Las Vegas since July just to keep Reflection Bay in operation. Those loans, plus the original loan amount for the course’s construction, have left Lake Las Vegas almost $28.4 million in debt to Carmel for Reflection Bay, resort attorneys said. While they didn’t offer an estimate of the course’s value in court documents, they stated that its value is “substantially less” than $28.4 million.
Operating reports for Lake Las Vegas show that the resort lost $11.5 million in May, and has lost $60.7 million overall since filing for bankruptcy.
In addition, Reflection Bay is located in Lake Las Vegas’ interior, whereas The Falls is located along the resort’s gateway, Lake Las Vegas Parkway. Some creditors who argued against abandonment of The Falls said that if the course deteriorated, it would hurt the resort’s appearance and further decrease home sales and tourism.
Carmel has maintained The Falls, but it has not been re-opened for play. On Friday afternoon at the resort, two workers were making their way through The Falls, trimming and watering the course. Up the road at Reflection Bay, there was a tense quiet as employees braced for today’s hearing to find out if they would be laid off on Tuesday.
Out on the course, a few foursomes and a couple pairs were making their way through the course that was once the site of the Wendy’s 3-Tour Challenge. Inside the clubhouse, two groups were having lunch in the cafe near a trophy case containing reminders of when times were better at the resort -- including autographed memorabilia from the likes of Jack Nicklaus and Annika Sorenstam.
One resort employee, who asked not to be identified, said Reflection Bay had 100 players on Friday -- an amount that under different circumstances might have been a good sign.
“I think we just got caught up in the big picture of what’s going on with the resort as a whole,” the employee said.