Posted on: March 20, 2023, 08:21h.
Last updated on: March 20, 2023, 08:22h.
Construction on Dream Las Vegas has stalled in tandem with the developers’ financing plans, according to a new report by the Las Vegas Review-Journal. Between $25M and $30M are owed by the developer for the boutique luxury hotel, the newspaper reported.
In February 2020, the Dream Hotel Group — a New York City-based operator of four Manhattan luxury properties and hotels in Miami Beach, Hollywood, and Nashville — announced that it purchased 5.25 acres of undeveloped Las Vegas Boulevard land next to Harry Reid International Airport. It partnered with Southern California firms Shopoff Realty Investments and Contour, a privately owned commercial real estate development group, to develop the project.
Dream Las Vegas was to be operated by the Dream Hotel Group as a 21-story luxury hotel featuring 531 guestrooms, seven dining and nightlife venues — one being a rooftop pool deck — a 12,000 square-foot convention center, spa, and small casino floor. After being delayed by the pandemic shutdown, the casino hotel broke ground on July 8, 2022.
The End of a Dream?
Dream Las Vegas was originally estimated to cost $300M to complete, but that estimate has now nearly doubled to $550M-$575M. Developer Bill Shopoff, president and CEO of Shopoff Realty Investments, told the R-J he blames inflation, combined with the interest hikes on borrowing imposed last year by the Federal Reserve to control it. He said that work would resume once he and his partners strike a new financing deal, which he expects to happen “in the next couple of weeks.”
According to the R-J, the project’s owners have been paying lead contractor McCarthy Building Companies to build the project with cash and are trying to secure $400M more to continue. According to the newspaper, a lien notice filed on March 10 by McCarthy recorded $43.3M in payments received and $40.2M more due for worked already performed.
“They will be paid, and the project will get built,” Shopoff told the R-J.
Dream Hotel Group was acquired by Hyatt Hotels Corp. in February 2023. The corporation reportedly paid a base price of $125M, with an additional $175M due over the next six years “as properties come into the pipeline and open.”