Plaza Hotel developer has hand out even as Adelson's fortune dwindles


Here’s a strange story out of Israel this morning.

According to Reuters News Service in Jerusalem, the owners of Elad Group are asking Las Vegas Sands Corp. Chairman Sheldon Adelson for financial help in their quest to build a $5 billion version of New York’s Plaza Hotel on the Strip.

Huh?

Adelson’s Las Vegas Sands recently avoided bankruptcy through a capitalization effort that reduced the 75-year-old billionaire’s majority ownership stake in the company. Adelson and his family also infused more than $1 billion in cash into the casino operator. Meanwhile, Adelson’s net worth fell some $24 billion during the stock market collapse last year.

Also, Las Vegas Sands canceled development of its $600 million Strip condominium tower and several projects on Macau’s Cotai Strip.

So what makes the Elad principals think Adelson or Las Vegas Sands has the funds to invest in the now-vacant New Frontier site? 

Israeli businessmen Yitzhak Tshuva and Nochi Dankner plan to ask Adelson to become a partner in their project, Reuters said, quoting Israel's TheMarker financial news website.

Dankner and Tshuva are reportedly in New York to meet with bankers for the Plaza project. It was unclear if they would meet with Adelson.

In a statement, Dankner's IDB Development said that a partnership with Adelson was "not being considered by us and is not on the agenda."

Elad owns the New York Plaza Hotel and will use the name on the Strip. Elad bought the now demolished New Frontier for $1.25 billion in 2007 from Phil Ruffin.

The company took out a loan of $625 million from Goldman Sachs, but has since received a postponement for repayment of the loan and is seeking to change the terms and a further postponement.

Elad officials have said the company is continuing with planning work for the Plaza and would begin building after it receives financing for construction. However, most analysts and experts believe the development is dead for all of this year and well into 2010.