# Attn JC Owners..Hilton hotels taking over Cosmo



## derb (Mar 13, 2009)

During a TS presentation at the Hilton strip we were told Hilton Hotels is set to take over the Cosmo for a little over 1B(value is said to be 3.4B)
Yes he was a TS salemen and his lips were moving but several others said the deal was all but done.  They are to set up the cosmo under their Dennison Hotel line.

Now the question is, will they honor the promises to JC.


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## dougp26364 (Mar 14, 2009)

derb said:


> During a TS presentation at the Hilton strip we were told Hilton Hotels is set to take over the Cosmo for a little over 1B(value is said to be 3.4B)
> Yes he was a TS salemen and his lips were moving but several others said the deal was all but done.  They are to set up the cosmo under their Dennison Hotel line.
> 
> Now the question is, will they honor the promises to JC.



I wouldn't bet the farm on it. A week or so ago, one of the LV Papers was reporting that MGM's City Center was going to absorb the Cosmo. Of course, you can also find articles indicating the MGM is looking bankruptcy square in the eye. Until there's something signed, speculation on this projects fate really is just speculation.

*News 2/26/09     Cosmopolitan may become just another couple of towers at CityCenter

According to a report at Bloomberg.com,  The orphaned Cosmo may get some well established parents. MGM MIRAGE and Dubai World are looking to Deutsche Bank (the current owners of Cosmopolitan) for a $1.2-billion loan needed to finish CityCenter.  Deutsche Bank is considering merging the Cosmo with CityCenter and putting up the loan in return for an stake in the combined projects.  

The article goes on to  say that MGM MIRAGE has made some changes in order to save money. The changes mentioned incorrectly included the delay of the opening of one hotel and the cancellation of a condo development. Of course, both of these changes were due to the rebar issue that plagued The Harmon and not a budget decision. 

If this deal goes through, CityCenter will grow to 76.5 acres and have a total cost of $15.1 billion.
*

And then there's this headline from March 4th in the Review Journal.

*Mar. 04, 2009 

SEC FILING: MGM Mirage in talks with lenders 

Company says it will be in default if it can't alter payment structure 

*


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## ricoba (Mar 14, 2009)

There was a brief mention on the Hilton board about this.

Hilton is creating a new brand "Denizen" and it looks like the Cosmopolitan will become a Denizen Hotel 

Denizen Hotels

I have no clue whether Denizen will honor Cosmopolitan contracts, but this time, it looks like the TS salesman was telling the truth.


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## dougp26364 (Mar 14, 2009)

ricoba said:


> There was a brief mention on the Hilton board about this.
> 
> Hilton is creating a new brand "Denizen" and it looks like the Cosmopolitan will become a Denizen Hotel
> 
> ...



I guess heck just froze over. 

I'm still sitting in the wait-and-see group. There's been three or four reports since the original defualt. I'm just to get skeptical to get overly excited about who might end up with this project. 

City Center makes the most sense to me but, I believe MGM is to far over extended. I'm pretty sure Hyatt had their eye on this property at one time but, I haven't heard anything about that in a long time. Why Hilton would want this property is beyond me. They have a pretty heavy presence in Vegas already with no real need that I see to expand in this market. But, Hilton does seem to enjoy overkill when it comes to Orlando, Hawaii and Vegas.

When you get right down to it, I really think that both the LV Sun and RJ are just guessing at who might end up with this project. On 2/26 the RJ was reporting MGM. Now the Sun is reporting Hilton. I bet if we go back far enough we'll find that just about every major hotel brand has been named as potential new owners for the Cosmo since before the original default.


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## ricoba (Mar 14, 2009)

Here is SML2181 thread from the Hilton board regarding this.

Here is a news article regarding MGM mulling break up to pay the bills.


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## JeffW (Mar 14, 2009)

My non-legal background says that if the sale of Cosmo goes thru as a bankruptcy proceeding, then prior agreements with Jockey Club could be nulled out.  If it's a straightforward sale (at whatever price) then I'd think the committments would have to be honored.

Jeff


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## dougp26364 (Mar 14, 2009)

JeffW said:


> My non-legal background says that if the sale of Cosmo goes thru as a bankruptcy proceeding, then prior agreements with Jockey Club could be nulled out.  If it's a straightforward sale (at whatever price) then I'd think the committments would have to be honored.
> 
> Jeff



I believe this is a bank foreclosure.


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## ricoba (Mar 14, 2009)

For those of us who aren't JC owners or who have never stayed there, what was the original agreement between the JC & the Cosmopolitan project?


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## dougp26364 (Mar 14, 2009)

ricoba said:


> For those of us who aren't JC owners or who have never stayed there, what was the original agreement between the JC & the Cosmopolitan project?



From what I recall, there was a parking agreement to use the Cosmo's garage and for access to the swimming pool.


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## derb (Mar 15, 2009)

ricoba said:


> For those of us who aren't JC owners or who have never stayed there, what was the original agreement between the JC & the Cosmopolitan project?



1. several county improvements to the JC, such as sprinklers moving entrances etc.  cost est at 4 million and is completed.
2. reserved lparking spaces with an elevator to the JC.
3.  tennis courts (2)
4. 75 reusable passes to their beach club.  that is to say when one returns the pass to the front desk another can use it.
5. private entrance between JC and Cosmo.

My money is JC coming out on top.


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## Snotick (Mar 27, 2009)

I hope that they honor the original agreement.   The one thing that everyone is forgetting about The Cosmo.  Hilton is going to handle the hotel end of the operation.  But, there is still the Casino/Shopping/Condotel portion of this property that still needs to be run by someone.   Since Deutche Bank has not applied for a Gaming license, it is believed that someone else will be brought in to run the Casino portion.   I also think that it is a misconception that Hilton will own the Hotel Portion solely.   Deutche has too much money leveraged in this project, they need to get it up and running, and have the economy turn around, in order for them to recover their investment.

If, for some reason they decide to turn their backs on us JC owners.    I may have to turn into "Cousin Eddy" from Vegas Vacation.  I will stroll through their casino with a tank top on and a six pack hanging from my belt loop.   
After all we will still be neighbors.


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## UWSurfer (Mar 27, 2009)

Several years ago Hilton exited the gaming business in Vegas, selling the LV Hilton and licensing the Hilton brand there.   Flamingo dropped the Hilton name and except for HGVC's, which have no gaming, Hilton is out of the casino business.

It will be interesting to see if Blackstone Group, Hilton's owner decides to get back into gaming.


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