The sale of the Hooters Hotel in Las Vegas is expected to be complete by March under a plan disclosed late Wednesday by Innovation Capital LLC, the company conducting the bankruptcy auction.
Unable to meet its debt payments, 155 East Tropicana LLC filed for bankruptcy in August. The company then reached agreement with its main creditor, Canpartners Realty Holding Co. IV, to sell the 696-room hotel to the highest bidder.
Canpartners estimates the property on Tropicana Avenue is worth $80 million, but the debt carried on the property is $181 million. The investment firm, an affiliate of Los Angeles-based Canyon Capital Realty Advisors, has acquired $178 million of Hooters' debt within the last year.
The auction of the Hooters Hotel in Las Vegas does not affect operations of Hooters restaurants, which are owned or franchised by Hooters of America LLC in Atlanta.
In a court filing, Hooters Hotel said its net revenue for the 11 months ended Nov. 30 was $40.9 million, up from $40.5 million for the same period in 2010.
As of Thursday, it was unknown whether Canpartners would acquire the property with a credit bid or if another party would outbid the firm for the troubled hotel.
"We have a number of parties that have expressed interest in the asset," Matt Sodl, managing director with Innovation Capital in El Segundo, Calif., said in a phone interview. "We are working with them on the due diligence part of the process."
Under the plan, U.S. Bankruptcy Judge Bruce Markell will hold a hearing Jan. 20 on the sales strategy.
Bids for Hooters would be due Feb. 10, and an auction, would be held Feb. 17. The bankruptcy court will hold a hearing March 2 to confirm a reorganization plan, with the sale closing by the end of March.
In a bankruptcy sale brochure, Innovation Capital said interested buyers would need to make a refundable $2.5 million deposit to participate in the auction.
The 8.2-acre site includes a hotel with a 29,000-square-foot casino, six restaurants and bars, two entertainment venues and four retail stores. The casino includes 589 slot machines and 23 table games, including poker.
The property also includes a 566-space parking garage, 385-space surface parking lot, pool and fitness center, according to the four-page brochure.
Contact reporter Chris Sieroty at email@example.com or 702-477-3893.