Wednesday, July 12, 2000 | 5:19 a.m.
LAS VEGAS - Las Vegas Hilton employees met with management Wednesday to quell rumors swirling since a California developer agreed to buy the off-Strip resort.
Edward Roski Jr. agreed to buy the casino resort from Park Place Entertainment Corp. for $365 million and plans call for extensive remodeling of the once glamorous property.
No layoffs are anticipated as Roski considers expansion plans.
"There are 30 acres that are being under-utilized to develop," Roski said.
The new owner said he wants to update and expand the present casino, remodel more than 1,000 hotel rooms and add 1,500 rooms and a time-share development.
Industry analysts say Tuesday's announcement is good news for Park Place because it can focus on its Strip properties - Caesar's Palace, Bally's, Paris and the Flamingo Hilton hotel-casinos.
And financial experts say the purchase was a good deal for Roski, who bought the property for a third of its replacement cost.
"I think the guy got a fantastic bargain when you consider the size of the property," said Bill Thompson, a University of Nevada, Las Vegas professor and gambling expert.
Thompson compared the Hilton with new Strip casinos like the Aladdin and Mandalay Bay that carry $1 billion price tags.
"The facilities are older, but over the years it's been kept up," he said. "It's not a decaying property. It would cost a billion dollars to replace."
Roski said Wednesday that he wants to transform the struggling property next to the Las Vegas Convention Center to attract convention attendees and local residents, rather than its previous niche, which targeted upscale bettors.
"The property is better suited to conventioneers (than high rollers). If positioned properly, it will be a big benefit to the local market," Roski said. "The property is very well-positioned to serve the east side of Las Vegas."
Roski also wants to fashion the hotel-casino after some of the Strip's newer, hipper resorts such as Mandalay Bay to draw younger crowds.
Roski owns the Silverton hotel-casino south of the Strip off Interstate 15. He has plans for $200 million worth of improvements to the 300-room property as well.
Roski is part-owner of two sports franchises in Los Angeles, the NBA's Lakers and the NHL's Kings. While he plans to keep the sports book open, no bets can be taken on the Lakers or the Kings.
Selling the Hilton will allow Park Place to focus on enhancing its value by using the sale proceeds to buy back stock and pay down its debt, said gambling analyst Jason Ader of Bear Stearns.
"From our perspective, the Hilton was one of their worst assets," he said. "Arthur (Goldberg) is making a statement that he's not wed to anything that doesn't make money."
Since Park Place retained the Las Vegas Hilton's $28 million worth of high-end gambling customer marketing lists, the sale takes a competitor out of the high-end business, Ader added.
Despite reports that Goldberg, the chief executive for Park Place, was interested in selling the hotel to focus Park Place's efforts to lure high rollers to Caesar's Palace, Roski said he never knew the property was for sale until he approached the company.
Goldberg could not be reached for comment.
Roski said he approached Park Place in January about purchasing the Hilton after a trip to Las Vegas to scout possible sites to build an arena after he finished developing the STAPLES Center in Los Angeles.
Roski's plan to turn the Hilton's decadent high-roller penthouse villas into a restaurant/lounge/nightclub is on the money, said financial analyst Martin Roffman of Roffman Miller Associates.
"When I went there, all three were empty," he said, adding that in its heyday, the Las Vegas Hilton was the top resort in town for high rollers. "Now the upscale gambler feels more comfortable on the Strip."
Roffman also said $365 million is a good price for the 3,174-room property.
"I always like to see a fresh infusion of money in Vegas, he said. "Maybe he (Roski) will come up with something different."
The deal still needs the approval of Nevada gambling regulators. Executives of both companies expect to complete the sale by the end of the year.
Roski's Southern California-based Majestic Realty Co. is one of the largest privately held real estate companies in the country.
In 1971, Hilton Hotels bought the International and renamed it the Las Vegas Hilton, then the world's largest hotel for a total price of about $54 million.