Published Tuesday, Feb. 17, 2015 | 9:57 a.m.
Updated Tuesday, Feb. 17, 2015 | 5:35 p.m.
What began as a rumor this month is now official: the Las Vegas tourism authority is moving forward with plans to purchase the Riviera so it can be demolished to make room for more convention space.
The Las Vegas Convention and Visitors Authority board of directors will meet Friday to consider acquiring the 60-year-old Riviera for $182.5 million, according to the meeting’s agenda released today.
The authority would use the site as part of its $2.3 billion Las Vegas Global Business District project, which includes a 1.8 million-square-foot expansion of exhibit and meeting space.
Aside from acquisition costs, the board will consider approving up to $8.5 million in additional expenditures, including $3.5 million for Morgan Stanley to handle the transaction.
At a meeting this morning, the Clark County Commission approved issuing $185 million in bonds for the authority to fund the Riviera purchase.
Reports of the sale have been spreading widely this month, but executives did not confirm them until the agenda went out this morning.
According to the purchase agreement, the casino’s current operators would lease back the property and oversee its closure.
The agreement tentatively anticipates the transaction will close Friday and the hotel-casino — whose run in Las Vegas was mostly lackluster — would close up shop within six months. The operators could get an extra 90 days if necessary to meet certain gaming laws.
The authority could be in complete control of the site by August.
The authority said in a statement that it is premature for staff to discuss the sale any further before Friday’s board meeting.
MGM Resorts International CEO Jim Murren, whose company runs Circus Circus, across the street from the Riviera, applauded the news, in part because it would help accommodate the city’s burgeoning convention business.
“The days of (the Riviera’s) benefit to Las Vegas are long gone, and to have the quality construction, quality infrastructure, entertainment-oriented activity that the convention center would produce would be very beneficial to the neighborhood,” he said in an interview.
MGM is adding to its own convention space at Mandalay Bay, but Murren said he is “highly confident” Las Vegas can support both.
Gaming Control Board Chairman A.G. Burnett said in an email that the Riviera's new ownership doesn't need any regulatory approvals if they don't intend to have gambling.
"Current ownership can sell the property, and an organized wind-down will follow," he said. "The current licensee will surrender their gaming license after our agents conduct a final audit to ensure all taxes have been paid."
Then, Burnett said, the authority "can own the bricks, mortar and land."
The Riviera, which opened in April 1955, is one of the oldest casinos on the Strip.
Its original nine-story iteration was the first high-rise on the Strip.
Morry Mason of Taylor International Corp., which developed the hotel, told the Las Vegas Sun in 1993 that people used to wait in line just to ride the elevator for a view from the top.
But times have been tough on the Riviera for much of its history.
Michael Green, an associate professor of history at UNLV, said it was one of five casinos to open in 1955, and that was too much for the market to handle then.
“It’s ironic that it opened at a very difficult time for Las Vegas, and it’s closing as Las Vegas is emerging from a very difficult time,” Green said.
In 1989, the property weathered a fire that destroyed a construction area, seared the outside of its nine-story guest tower, damaged dozens of rooms and forced the evacuation of thousands of guests and employees.
The Riviera has also persisted through multiple bankruptcies and relatively frequent ownership changes over the past half-century. Starwood Capital Group, the current main owner, took over in 2010.
Even though the Riviera expanded dramatically since its opening, it wasn’t as successful as some other Strip properties in becoming a tourist magnet, Green said.
“There’s been much talk over the years, and maybe it reflects how frequently ownership changed, that the Riviera has been added onto and added onto without a Riviera theme surviving — without having any kind of theme,” he said. “The Riviera, sad to say, hasn’t been able to compete in terms of the ‘wow’ factor.”
Compounding the identity challenge, the Riviera has the additional misfortune of being located in a part of the Strip that has struggled greatly, particularly since the recession. Once in the company of hotels such as the Stardust and the New Frontier, the Riviera today is situated near several vacant lots and incomplete projects.
The unfinished Echelon, which Boyd Gaming intended to build where the Stardust once stood, is supposed to become Genting’s Resorts World Las Vegas, but construction hasn’t started.
The site formerly home to the New Frontier should one day become a new resort, too, though it also stands empty for now.
And the mothballed Fontainebleau building shows no signs of life.
The authority’s purchase of the Riviera would follow a well-established Las Vegas tradition of tearing down an old casino, hoping a newer project will have better luck.
And, yes, Las Vegans can probably look forward to another implosion.
Las Vegas Sun reporter Conor Shine contributed to this report.