Lucky Dragon temporarily shuts gaming, restaurant operations

Updated January 4, 2018 - 7:36 pm

The Lucky Dragon, the one-year-old Asian-themed hotel-casino, is temporarily closing all gaming and casino restaurant operations as it struggles to attract customers.

The move jeopardizes hundreds of jobs and $60 million in loans from Chinese investors seeking American citizenship.

“Effective immediately Lucky Dragon Hotel & Casino is beginning the process of repositioning and, in doing so, will have a reduction in staff while it temporarily closes all gaming and restaurant operations,” the company said in a statement Thursday morning.

The casino floor and restaurants will resume operations “within six months,” the company said in the statement. The 203-room hotel will remain open, as will the gift shop and the hotel’s Cha Garden restaurant and bar on the first floor.

Signs posted on the casino’s entrance doors read, “Casino temporarily closed.” Construction workers outside the building turned off water that spun a stone ball sculpture.

According to hotel workers, the casino closed at 7 a.m. Thursday morning. Only employees and hotel guests were allowed in the parking lot as of Thursday morning.

The hotel’s 203 rooms are fully booked during CES, an international consumer electronics show that officially starts Tuesday, according to a hotel worker taking reservations over the phone Thursday morning.

The Lucky Dragon declined to say whether “repositioning” implied the casino would change its name or focus on Asian clients.

Small crowds

The boutique casino opened near the north Strip to great fanfare in December 2016 with plans to hire 800 people. But the casino never drew crowds to its small floor dominated by baccarat tables.

Just a few months after opening, the Lucky Dragon shuttered one of its restaurants and fired about a hundred people, including the general manager, to cut costs.

The property’s founders sought to tap the fast-growing Asian and Asian-American middle-class populations in Las Vegas and on the West Coast.

Nearly 6 million people of Asian ethnicity live in California, while more than 200,000 live in Clark Country as of July 2016, according to the U.S. Census Bureau. Los Angeles, a big feeder market, is just a four-hour ride from Las Vegas.

While the strategy seemed credible, it nonetheless put the Lucky Dragon in direct competition with bigger players like Boyd Gaming and Station Casinos for the lucrative, local Asian client.

Industry consolidation

And the launch of a stand-alone casino was running counter to the gaming industry’s growing trend of consolidation.

Casino operators have been acquiring smaller competitors at a record pace over the past three years to widen their customer bases, cross-sell their properties and lower costs amid sluggish industry growth. The Lucky Dragon had to build its customer database from scratch.

”It is tough to compete in Las Vegas against major operators that have been around a long time,” said John DeCree, an analyst at Union Gaming. ”It takes a while to ramp up a new casino. If you don’t have deep pockets, it could be difficult to keep operating.”

It could not vie with Boyd and Station on generous food comps, nor did it offer a diversity of amenities, Asian gamblers in Las Vegas told the Review-Journal last month.

SLS Las Vegas, located just down the street from the Lucky Dragon, stepped up its efforts to attract local Asian players around the time the Lucky Dragon opened. SLS began offering weekly baccarat prizes of up to $30,000 in promotional chips, the players said. Boyd’s Gold Coast, a favorite among local Asian players, added more baccarat tables and prizes as well.

A narrow choice of casino games may have also squeezed the Lucky Dragon’s revenue generation, DeCree said. The casino generated the majority of its revenue from baccarat, which DeCree said is ”low margin and very volatile.”

500 employees, EB-5 funding

The Lucky Dragon had more than 500 full-time and part-time employees as of December. The company did not say how many people would temporarily lose their jobs.

Laid-off staff will be able to return once the casino reopens, the company said in the statement.

The Lucky Dragon was funded with $60 million in loans from 120 Chinese families seeking a permanent green card through the EB-5 program.

Under the program, foreign investors can receive permanent green cards if they invest $500,000 in at-risk projects that create 10 jobs. EB-5 investors are generally willing to accept a nominal interest rate in order to receive the green card.

The Lucky Dragon investors face the prospects of losing their money and right to a green card if the project fails.

Contact Todd Prince at tprince@reviewjournal.com or 702-383-0386. Follow @toddprincetv on Twitter.

ad-high_impact_4
Business
Opendoor isn't the typical house flipping company
Unlike most house flippers, the company aims to make money from transaction costs rather than from selling homes for more than their purchase price.
The Venetian gondoliers sing Italian songs
Gondolier Marciano sings a the classic Italian song "Volare" as he leads guests through the canals of The Venetian in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal)
Building In Logandale
Texas homebuilder D.R. Horton bought 43 lots in rural Logandale. (Eli Segall/Las Vegas Review-Journal)
Indoor farming in Southern Nevada
Experts discuss Nevada's indoor farming industry. (Bailey Schulz/Las Vegas Review-Journal)
Former Fontainebleau could have become a Waldorf Astoria
Months after developer Steve Witkoff bought the Fontainebleau last summer, he unveiled plans to turn the mothballed hotel into a Marriott-managed resort called The Drew. But if Richard “Boz” Bosworth’s plans didn’t fall through, the north Las Vegas Strip tower could have become a Waldorf Astoria with several floors of timeshare units. (Eli Segall/Las Vegas Review-Journal)
LVCVA CEO Rossi Ralenkotter announces plans to retire
Rossi Ralenkotter, CEO of the LVCVA, on Tuesday confirmed a Las Vegas Review-Journal report that he is preparing to retire. Richard N. Velotta/ Las Vegas Review-Journal
Cousins Maine Lobster to open inside 2 Las Vegas Smith’s stores
Cousins Maine Lobster food truck company will open inside Las Vegas’ two newest Smith’s at Skye Canyon Park Drive and U.S. Highway 95, and at Warm Springs Road and Durango Drive. Cousins currently sells outside some Las Vegas Smith’s stores and at Fremont Street and Las Vegas Boulevard. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas home prices to continue to rise, expert says
Lawrence Yun, chief economist at the National Association of Realtors, gives homebuyers a pulse on the Las Vegas housing market. (Eli Segall/Las Vegas Review-Journal)
NV Energy announces clean energy investment
The company is planning to add six solar projects in Nevada, along with the state's first major battery energy storage capacity. Bailey Schulz/Las Vegas Review-Journal
3 Mario Batali restaurants on Las Vegas Strip to close
Days after new sexual misconduct allegations were made against celebrity chef Mario Batali, his company announced Friday that it will close its three Las Vegas restaurants July 27. Employees of Carnevino Italian Steakhouse, B&B Ristorante and Otto Enoteca e Pizzeria, all located in The Venetian and Palazzo resorts, were informed of the decision Friday morning. Bastianich is scheduled to visit the restaurants Friday to speak to employees about the next two months of operation as well as how the company plans to help them transition to new positions.
Nevada has its first cybersecurity apprenticeship program
The Learning Center education company in Las Vegas has launched the first apprenticeship program for cybersecurity in Nevada. It was approved by the State Apprenticeship Council on May 15. (K.M. Cannon/Las Vegas Review-Journal)
Las Vegas union members voting to authorize the right to strike
Thousands of Las Vegas union members voting Tuesday morning to authorize the right to strike. A “yes” vote would give the union negotiating committee the power to call a strike anytime after June 1 at the resorts that fail to reach an agreement. (Todd Prince/Las Vegas Review-Journal)
Small businesses struggle to find qualified candidates
A 2018 survey found that over two-thirds of small businesses in Nevada find it somewhat to very difficult to recruit qualified candidates. Bailey Schulz/Las Vegas Review-Journal
Nevada secretary of state website offers little protection against fraudulent business filings
Property developer Andy Pham tells how control of his business was easily seized by another person using the secretary of state website.
Caesars may be going solo in its marijuana policy
Several Southern Nevada casino companies aren’t following Caesars Entertainment’s lead on marijuana testing.
How much is the Lucky Dragon worth?
Less than a year-and-a-half after it opened, the Lucky Dragon was in bankruptcy.
Gyms and discount stores take over empty retail spaces
Grocery stores used to draw people to shopping centers. But many large retail spaces have been vacant since 2008. Discount stores like goodwill and gyms like EOS Fitness are filling those empty spaces, and helping to draw shoppers back in. K.M. Cannon/Las Vegas Review-Journal
Funding source of Las Vegas stadium for the Raiders is sound, expert says
The stadium is funded in part by $750 million of room taxes, the biggest such tax subsidy ever for a professional sports stadium. Robert Lang, executive director of Brookings Mountain West and The Lincy Institute at UNLV, says that is a good use of public funds. (Richard Velotta/Las Vegas Review-Journal)
Las Vegas needs light rail, expert says
Robert Lang, executive director of Brookings Mountain West and the Lincy Institute said he is afraid of a "congestion mobility crisis." Las Vegas needs a light rail system, he said, to accommodate the city's growing number of attractions. (Richard Velotta/Las Vegas Review-Journal)
Three takeaways from Wynn Resorts' Earnings Call
Matt Maddox came out swinging in his first earnings conference call as Wynn Resorts chief executive officer, boasting of record Las Vegas quarterly revenues and applicants lining up for work.
Star Wars VR Comes to Las Vegas
Sneak peak at the new "Star Wars: Secrets of the Empire" VR experience at the Grand Canal Shoppes.
Elaine Wynn continues her fight to change Wynn Resorts board
Elaine Wynn, the largest shareholder of Wynn Resorts Ltd., is seeking to kick a friend of her ex-husband Steve Wynn off the company’s board of directors. (Todd Prince/Las Vegas Review-Journal)
Zillow is getting into house flipping in Las Vegas
Las Vegas Review-Journal real estate reporter Eli Segall says flipping houses has waned in popularity after the housing bubble burst.
Ellis Island Buys Mt. Charleston Lodge
Ellis Island, which operates a casino, brewery and hotel just off the Strip, purchased the Mt. Charleston Lodge in early April.
Casinos to be penalized for allowing drug-impaired customers to gamble
Nevada Gaming Commission Chairman Tony Alamo talks about an amendment making casinos subject to the same disciplinary standards of preventing people to gamble if impaired by drugs as they are for letting them play while intoxicated by alcohol.
Terrible Herbst to open large travel center in Southern Nevada
The 50,000-square-foot commercial travel center will include 96 fuel pumps and the third White Castle restaurant in Southern Nevada. Wade Tyler Millward reports.
Art Bell’s Top 10 Shows
A selection of radio host Art Bell’s most popular shows.
Hooters owner talks about room upgrades at his hotel-casino
George Ruff, founder and senior principal of Trinity Hotel Investors L.L.C., owner of Hooters Hotel and Casino in Las Vegas, talks about recent room upgrades at the hotel. K.M. Cannon/Las Vegas Review-Journal
Passengers Discuss Allegiant Air
Allegiant Air passengers voice their views on the airline at McCarran International Airport on April 16, 2018. (Bailey Schulz/Las Vegas Review-Journal)
Longtime Las Vegas attorney John Momot dies at age 74
Criminal defense attorney John Momot, who represented mob figures and even played himself in the movie “Casino,” has died.
TOP NEWS
News Headlines
ad-infeed_1
ads_infeed_2
Local Spotlight
Home Front Page Footer Listing
Circular
You May Like

You May Like