State gaming regulators on Thursday approved licensing for the SLS Las Vegas, setting the stage for this weekend’s opening of the $415 million redevelopment of the former Sahara.
Nevada Gaming Commission Gaming members said they were comfortable with the financing and operation of 1,620-room hotel-casino on the north end of the Strip that underwent an 18-month renovation.
The hearing in Las Vegas took less than 90 minutes, roughly half the time it took for the Gaming Control Board two weeks ago to recommend approval of Stockbridge Real Estate of San Francisco and SB Gaming, a subsidiary that will manage the SLS Las Vegas.
Gaming Commission Chairman Tony Alamo Jr. said commissioners were able to review the transcripts from the Control Board hearing. The SLS Las Vegas will open shortly after midnight Friday to the public following a VIP party.
“I’m very comfortable in saying yes,” Alamo said.
The Gaming Commission placed several conditions on the gaming license, including a request that SLS Las Vegas developer Sam Nazarian, CEO of SBE Entertainment, not have any management influence over the casino operations or share in the property’s gaming revenue until he is licensed by Nevada.
Earlier this month, the Control Board agreed that SBE’s share of SLS’s gaming revenue be placed into an escrow account until Nazarian and the company are licensed.
Control Board Chairman A.G Burnett told the commission it would take three to five months to complete Nazarian’s license investigation.
Alamo called Nazarian’s gaming application complicated, but that he has been “compartmentalized” in a non-control role in the SLS Las Vegas.
Nazarian attended the Gaming Commission hearing, but did not address the panel. He provided the narration on a video presentation about SBE Entertainment.
“Mr. Nazarian is a visionary,” Alamo said. “It’s all because of him this came together.”
Stockbridge owns 90 percent of the SLS Las Vegas while SBE Entertainment owns the remaining 10 percent but does not have any voting rights.
The SLS Las Vegas renovation was made possible by a combination of $300 million raised by investment firm J.P. Morgan and $115 million raised through EB-5 financing, which gives foreign nationals a method of obtaining a green card in exchange for an investment in the U.S.
Stockbridge Executive Managing Director Terry Fancher has authority over all operations of the property. SLS Las Vegas President Rob Oseland will oversee the casino’s day-to-day operation and report to Fancher.
“You have hired some excellent people to run the gaming operation,” Gaming Commission Member John Moran Jr. said during the hearing.
Following the hearing, Fancher said he spends two to three days a week in Las Vegas but is constant conversation with Oseland.
“Sam put this together and put the people in place,” Fancher said. “It’s a great team.”
SBE Entertainment operates restaurants and nightclubs throughout the U.S., as well as SLS hotel brand.
The SLS has been reconfigured to include a 56,000-square-foot casino with nearly 800 slot machines, 74 table games and a high-limit gaming area. A sports book will be operated by William Hill.
The nine restaurants and three nightlife venues include many SBE signature brands, including Umami Burger, the Mediterranean-themed Cleo, Japanese-themed Katsuya, 800 Degrees pizza and The Sayers Club entertainment lounge.
The three former Sahara hotel towers, all built in different decades, have been reconfigured under new names — Lux, World and Story — and are aimed at different markets: the luxury customer, the tour and travel market and the younger crowd looking for a “Vegas weekend.”
Widely known Los Angeles retailer Fred Segal has seven locations inside the property.
SLS Las Vegas hired 3,400 employees.
Stockbridge manages nearly $8 billion in real estate holdings and handles investments for five of the the six largest pension funds in the country.
The company once owned the Hollywood Park Racetrack near Los Angeles and the Bay Meadows Racetrack new San Francisco. Both racetracks have closed. Stockbridge also owns the Hollywood Park Casino in Los Angeles.
Fancher told regulators the Sahara was first presented to Stockbridge by Nazarian in 2006 and the company agreed to finance the purchase, which was completed in 2007. Terms were not disclosed.
“We have a very conservative financial structure for the SLS,” Fancher said.
SBE operated the nongaming aspects of the Sahara and hired a management company to run the casino until the Sahara was closed in May 2011.
Contact reporter Howard Stutz at firstname.lastname@example.org or 702-477-3871. Follow @howardstutz on Twitter.