Lake Las Vegas to Reorganize Under Chapter 11
$127 Million in Post-Petition Financing Commitments to Fund Ongoing Operations and Assessments Related to Certain Pre-Petition Infrastructure Obligations
HENDERSON, Nev.--(BUSINESS WIRE)--Citing a combination of poor liquidity, substantial debt service, extremely challenging real estate market conditions and other legal and financial issues, Lake at Las Vegas Joint Venture, LLC, the master developer of the Lake Las Vegas Resort (“LLV”), and several of its interdependent subsidiaries today filed to reorganize under Chapter 11 of the Bankruptcy Code.
“Our goal is to work with builders, as well as state and local officials to create a viable, sustainable community of which we can all be proud”
In conjunction with the Chapter 11 filing, the company has received commitments for up to $127 million in debtor-in-possession (DIP) financing from a group of lenders led by Credit Suisse as agent. The company said that, subject to Court approval, the new financing would be used in part to fund ongoing operations and assessments related to certain pre-petition obligations, including critical repairs to the Las Vegas Wash bypass conduit underlying the 320-acre man-made lake at the center of the approximately 3,600 acre master-planned community. Additionally, pending Court approval, the company said it would work to satisfy certain of its financial and infrastructure-related obligations.
According to Frederick Chin, president of the company, “The decision to reorganize under Chapter 11 in large part reflects our belief that we can reinvigorate Lake Las Vegas as a premier master-planned community. Our commitment to Lake Las Vegas is second only to our belief in the long-term viability of the Las Vegas real estate market. We believe that with a realistic capital structure and business plan, Lake Las Vegas will provide enormous opportunities for those associated with it, including residents, visitors, employees, builders, developers and vendors.
“Our goal is to work with builders, as well as state and local officials to create a viable, sustainable community of which we can all be proud,” Mr. Chin said.
LLV Holdco LLC, a subsidiary of Las Vegas-based Atalon Group, assumed ownership and management control of the master-planned community in early January 2008 after the former ownership group defaulted on approximately $540 million in loans in 2007.
The company said that the DIP facility assures that there will be no interruption in day-to-day operations, adding that, subject to Court approval, employees will continue to receive their wages and be entitled to benefits as if there had been no filing. Vendors, contractors and consultants will be paid for goods and services provided after the July 17 filing date.
Lake Las Vegas Resort is a 3,592-acre master-planned residential and resort community adjacent to Lake Mead National Recreational Area and 20 miles east of the center of Las Vegas. It includes a 320-acre man-made lake, three signature golf course, two luxury hotels, a casino and retail shops and more than 1,600 completed residential units. LLV and it subsidiaries employ approximately 260 people, most associated with its golf course operations.
The filing occurred in U.S. Bankruptcy Court for the District of Nevada in Las Vegas.
Interested parties may obtain more information by visiting the claim agent’s website at www.kccllc.net/llv or calling toll free 866-248-3389.