Tuesday, Jan. 19, 2010 | 8:33 a.m.
The owner of the Krave nightclub and Harmon Theater in Las Vegas filed for bankruptcy reorganization Monday, saying it's behind on rent and tax payments but that its financial situation should improve because CityCenter has revitalized the area.
Krave Entertainment LLC President Sia Amiri said in court papers that the businesses at the Miracle Mile Shops at the Planet Hollywood resort on the Las Vegas Strip suffered last year because of the recession and construction on Harmon Avenue and CityCenter. When it opened in 2004, the 17,000-square-foot Krave billed itself as the first gay/lesbian/alternate lifestyle club on the Strip.
Because construction limited access to the venues last year, the Harmon Theater lost three of its variety shows. The venue now has two shows and another is set to begin, Amiri said in the bankruptcy filing.
Things are looking up now with last month's opening of MGM Mirage's CityCenter complex, he said.
"CityCenter revitalized the entire area, and debtor’s operations are now located at a prime site on the Las Vegas Strip. The new road route is expected to facilitate customer access," Amiri said in the filing. "With respect to the Harmon Theater operations, debtor plans to book more shows and fill up capacity. With respect to the nightclub operations, the Krave brand name is popular with its clientele, and debtor plans to revamp its marketing plan and add new events."
Amiri said he and co-owner Kelly Murphy were unable to raise capital to cover losses in late 2009 because of liens filed against them by the Nevada Department of Taxation related to their personal guarantees of the businesses' tax obligations.
The company is cash-flow positive on an operating basis and filed for bankruptcy to restructure its obligations, Amiri said.
The company listed assets of $153,416 against liabilities of $3.5 million -- including some $485,000 owed to the Nevada Department of Taxation and Division of Industrial Relations for sales, entertainment and unemployment taxes; and about $601,000 owed to the IRS for payroll taxes.
Another $847,000 in back rent is owed to landlord IRALP Inc., the bankruptcy filing says.