LT Hard Rock owners selling 50% stake
By Kathryn Reed
Lake Tahoe Hard Rock owners are selling half of their interest in the Stateline property to an organization out of Las Vegas.
Representatives were before the Gaming Control Board this week regarding money issues, which comes days after having another lawsuit filed against the troubled Stateline casino.
Brothers David and Jon Park are struggling to make Lake Tahoe Hard Rock a viable entity. Photo/Denise Haerr
Tentative approval was given to Neva One, the parent company of the local Hard Rock, for a waiver on the escrow account and to enter an agreement with Paragon HRLT to manage the property. The final decision is expected Feb. 18 when the Gaming Commission meets in Las Vegas.
Neva One was formed by brothers Jon and David Park with the sole purpose of being the parent company of the Lake Tahoe Hard Rock. Park Heritage is Neva One’s parent company. After a $60 million renovation, the old Horizon hotel-casino reopened Jan. 28, 2015, as the Hard Rock. There have only been troubles since then.
The escrow item pertains to the Parks selling 50 percent of the Hard Rock to an affiliate of Paragon. The exact name of the affiliate was never stated at the Feb. 3 meeting. A Gaming Control Board official told Lake Tahoe News the entity has been licensed before.
Only percentages were discussed, not dollar amounts at the hearing.
The Gaming Control Board requires escrow accounts when there is a transfer of interest and the board or commission has not yet acted. Neva One was granted a waiver for this because of the board’s familiarity with the new partner.
During Wednesday’s discussion, which lasted about 30 minutes, it was noted that Park Heritage has infused more cash to keep the hotel-casino afloat. The exact amount was not stated. The money from Paragon will assist with paying down the debt and resolving outstanding litigation issues.
The pool is has not had water since last summer. Photo/LTN
It was also brought up at the hearing that the leak in the 200,000-gallon pool must be resolved because that water would be used by Tahoe Douglas firefighters if there were a fire. Without the water, permits could be revoked and the hotel-casino shutdown.
A condition of approval was made at the Feb. 3 meeting stating Neva One and Paragon HRLT must have a management agreement in place within 10 days.
The change in management comes in the wake of Warner Hospitality having been fired last year by the brothers. The Parks have since filed a lawsuit against Warner.
Neither brother returned a call, nor did Jim Roets who with Rick Stevens were tasked with bringing stability to the property after Warner was shown the door.
The latest lawsuit filed against the Park brothers is from Tahoe Specialty Flooring & Window Design of Tahoe City. The lawsuit filed in Douglas County District Court in Minden, where Neva One is based out of, alleges the flooring company is owed more than $68,000. Owner Coreen Serrano was not available for comment.
Still to be resolved is the $6.4 million lawsuit filed by SMC Contracting against the hotel-casino owners for failure to pay for most of the overruns associated with construction costs for the remodel. Savage & Sons, which did the plumbing at the property, has filed a lawsuit trying to recover $820,000 from Neva One.
The problems plaguing the Hard Rock are not unique to it.
Entertainment is the driving force that will bring people into this venue. We have a tremendous environment for bringing in world class entertainment, yet spare Harvey’s & Harrah’s, nobody else seems to even try.
Hard Rock has the venue, they need to book the acts that will fill the hotel up with guests who will pay to see good music.
This project was under capitalized from the beginning. It also had unrealistic market assumptions and has significant competitive challenges.
A.B…’Entertainment is the driving force’
Agreed, however, target audience should be Baby-boomers…80,000,000 of them…Brian Wilson, Willie Nelson, ‘Fats’ Domino…..they’ve been here before and they love coming back AND the 80,000,000 are well behaved now that they’ve aged out and they have money
Need them, bring them on!
Robin Smith:
I agree with you 100% that target audiences should be baby-boomers. They have money to spend on entertainment, for lodging, dining out, and tipping the local minimum wage service people; they know how to behave and they don’t damage hotel rooms or other facilities. We don’t need the type of entertainers that attract people with little money to spend who are only hanging out seeking every freebie they can get and don’t know how to behave civilly.
If this destination does not get ahold and build loyalty within the millennial market we will lose over the long term to other destinations. The millennial market Is bigger then the baby boomer market and while boomers spend more on travel now, millennial travel spending will outpace that spending. I think a smarter long term strategy is to attract both. If we just focus on boomers while other destinations appeal to both segments and gain the loyalty of millennials we will be at a long term competitive disadvantage.
What is half of nothing
80,000,000
According to the census there are 83 million millennials and 75 million baby boomers. Millennial spend over $200 billion on travel annually. Any destination that does not attract this segment is missing a huge strategic opportunity.
Mr. Ribaudo:
Thank you for stating an excellent point. Sometimes I forget about long-term strategizing–likely due to my advancing years.
4-mer
Thanks. I think we can take both the short and long view and keep south shore as competitive as possible.
Even sporting events like boxing was bringing people to town back in the day. Go to Vegas the weekend of a big fight and it is packed! I really thought the Hard Rock was going to pursue getting boxing and MMA into it’s showroom since the Hard Rock in Vegas has had success with it the last few years whenever they have tried! Hard Rock in Vegas is also known for great acts, acts that don’t seem to be getting booked in Tahoe? You have to invest today for a future profit.
Also Poorly managed departments don’t help. When employees don’t think much of the product or work place, those kinds of attitudes spill over into a small community like Tahoe. It just seems like somehow the Park’s thought the name itself would bring in profit and not great ideas to bring in profit? I wish them the best, the land shouldn’t be empty, that does nobody any good.