For several weeks we’ve been waiting to see how the Hard Rock saga would play out. At first the company was reported to have gone belly up, and then it was reported that the company had signed a standstill agreement, giving it time to deal with its financial difficulties. In the end, the inevitable happened.
Brookfield Asset Management Inc. said Wednesday it had assumed ownership of the Hard Rock Hotel after reaching a settlement with borrowers. Warner Gaming of Las Vegas has been hired to operate the Hard Rock casino.
“Hard Rock is an iconic property in Las Vegas,” said William Warner, CEO and founder of Warner Gaming. “Our goals are to preserve and enhance the value of the Hard Rock brand and to ensure the hotel and casino ranks among the top destinations for visitors to the city.”
Since 2006, the Hard Rock Hotel has been owned as a joint venture Morgans Hotel Group and DLJ Merchant Banking Partners. Fred Kleisner, chief executive officer of Morgans, said in a statement, “With this agreement, Morgans Hotel Group has been released from any liability for Hard Rock debt, and from all of its guarantee obligations with regard to this property.”
The settlement agreement effectively transfers the joint venture stake in the Hard Rock Hotel and Casino into the hands of Brookfield Asset Management.
“The Hard Rock Hotel and Casino has significant brand recognition and a valuable position within the Las Vegas community,” Andrew Willis, senior vice president, communications and media with Brookfield Asset Management, said. “We are confident that together with Warner Gaming, we will be able to successfully restructure this business and return it to profitability,” he added.
It’s certainly a prime piece of real estate. What do they say about real estate? Location, location, location, and it doesn’t get much better than the Hard Rock on the Vegas strip.