Anyone heard this rumor--Atlantis

[mariawolf]

Someone on Cruise Critic has posted that Atlantis is in negotiations to sell the hotel--I know there have been lots of layoffs but this seems somewhat far out.
If anyone is there now or has heard anything info would be appreciated.

 

[clsmit]

Is the rumor that the Kerzner's are trying to sell the entire Atlantis complex, or something else?

 

[tomandrobin]

I would be really surprised of that, especially since Dubai just opened. I am sure there might be some truth in the rumor, but not the hotel is up for sale.

 

[mariawolf]

Someone on CC was asking about buying day passes over Easter and was told this is the info for now but who knows by then as Atlantis is in negotiation for sale.
I will say that the poster is on TA a lot and does not like Atlantis==but has not posted this info there and I hesitate to post there to ask the question.

 

[tomandrobin]

Someone on CC was asking about buying day passes over Easter and was told this is the info for now but who knows by then as Atlantis is in negotiation for sale.
I will say that the poster is on TA a lot and does not like Atlantis==but has not posted this info there and I hesitate to post there to ask the question.

This is from a recent press release...

Kerzner’s flagship brand is Atlantis, which includes Atlantis, Paradise Island, a 2,900-room ocean-themed destination resort in The Bahamas. This unique destination features a variety of accommodations, including the new resort The Cove Atlantis, all built around a 100-acre waterscape with over 20 million gallons of fresh and saltwater lagoons, pools and habitats, the world’s largest open-air marine habitat and some of the most beautiful beaches in the world. Kerzner is extending its Atlantis brand globally with the development of Atlantis, The Palm, Dubai, a 1,500-room, water-themed resort expected to open in September 2008 on The Palm, Jumeirah. Kerzner has also commenced construction of a 600-room, destination casino resort in Morocco that will open in 2009, which will be operated by Kerzner under a new brand that it will be introducing to the market. Kerzner also manages six luxury resort hotels under the One&Only brand. The resorts, featuring some of the top-rated properties in the world, are located in The Bahamas, Mexico, Mauritius, the Maldives and Dubai. Additional One&Only properties are currently in the development stages in South Africa, Zanzibar and Costa Rica. For more information concerning Kerzner and its operating subsidiaries, visit kerzner.com.

Not sure why they would sell thier flagship resort. Maybe its the residence tower they are trying to unload?

 

[ocdb8r]

Maria,

Link to the post please.

My suspicion is they are talking about the Comfort suites that is on Atlantis property. Many would advise booking a single night there instead of buying day passes as the Comfort suites is currently owned by Atlantis and grants use at the facilities. There has been some discussion that Atlantis would sell that hotel...not the main hotels in their complex.

C.

 

[mariawolf]

No real link--just a comment by this particular poster--that makes some sort of sense as folks go to Comfort Suites from the cruise ships and rent a room for the day to get bracelets for use and I am guessing that they would prefer that folks just buy direct from Atlantis--I did PM the poster on Trip Advisor and ask about it--didn't want to post there and cause some furor.

 

[komosatp]

Maria,

While I haven't heard any rumors, I wouldn't be surprised.

The Kerzner's took Atlantis private in 2006, which was they heyday of easy credit. Given what's been going on in the financial markets since 2006, its likely that Sol is having some financing problems. He likely could be in the position where his PERSONAL fortune is in jeopardy because of changes in these markets since then. His financed portion of the buyout could be in trouble. He could be in violation of some of his debt covenants because cash flow at the resort is below a certain threshold, or insurance he was required to buy to insure his debt payments have become prohibitively expensive. Or any other number of complications in his DEAL, not in the resorts profitability or operations.

Atlantis-proper likely is not at any risk because of the Dubai owners could buy the Kerzner's share of Atlantis, probably out of their personal checking accounts, not having to go to the capital markets to raise money. But Sol would likely have to sell to them cheap so he's likely exploring all options.

But from a longer term perspective, I think over the life or our investment at Harborside, Atlantis will change hands once, if not several times until it either ends up in the stable of a gaming, hotel, or integrated media/entertainment company. In those industries, Atlantis is currently a niche-y boutique-y company. It's likely on the radar of the big companies in those industries as an acquisition, were it to come up for sale at the right price.

 

[mariawolf]

I got a message back from the poster on TA--she says this has been going on for some time but with the economy the way it is it may fall through. According to her the layoffs were part of the overall deal in order to cut expenses. But honestly with one whole hotel closed it would make sense that layoffs would have to happen.
Apparently some attempt has been made, according to her, to sell of piece meal--I sort of find that hard to believe but who knows.
I agree that it will likely be sold sometime but I hope it stays as one piece.

 

[mariawolf]

Here is the link I was sent--it is 4 months old--supposedly according to this poster they were back in the Bahamas over the last week or so.

http://www.bahamasb2b.com/news/story.php?title=MGM-Mirage-to-Purchase-Atlantis-Bahamas

 

[tomandrobin]

Interesting read, but a lot of things have changed in the past 4 months.

 

[jarta]

I returned from Harborside yesterday. Harborside is close to full. Atlantis is not.

The Atlantis casino was sparsely populated. The buffets (including Mosaic) were sparsely populated. Staff told me 800-900 persons had been let go recently. They also said the cruise ship/tourist business was way down. Even the Reef and Cove areas were not crowded. It would not surprise me if Kerzner was contemplating a sale.

But, to whom? Most casinos are having problems. Adelson from Las vegas Sands (Venetian/Palazzo) is really having problems.

http://latimesblogs.latimes.com/money_co/2008/11/casino-giant-la.html

I was at the Venetian/Palazzo last month. It was a lot more busy than Atlantis.

 

[mariawolf]

Jarta--did you find restaurants mostly closed?? Also there have been posts on other forums that the Beach Tower is boarded up--can you still confirm that??
My brother is there this week and we go the first week of January--it is COLD here in DC--it has gotten much colder earlier this year so I am really counting the days!

 

[influential_ar]

I was at Harborside/Atlantis 21-28 Dec and had a good scout around there to find out what's going on with Harborside (sales) and Atlantis (being sold). Situation/rumour was thus:

Harborside - running at 90+% occupancy, with 100% up to 1st Jan. No incentive for existing owners to take the "owner update" as they're allegedly all sold out apart from the odd 1-bed. Tried to rent a few extra days between 28th and 1st Jan - quoted $600-1000 per night depending on size.

Atlantis - was at 40% occupancy (!) and struggling. Some restaurants closed. The staffing layoff was causing troubles between Kerzner and the Bahamas govt (the latter promised K tax incentives based upon employment levels. He's broken that agreement but is citing them doing the same as they haven't rebuilt the Bay St. area etc. up to the required levels), so sounds like the parties are falling out. Rumour has it that he's trying to sell to either MGM or Disney. The pool areas were deserted until Christmas Day when suddenly everything filled up. The marina was busy throughout. The Bay St stores were discounting the high-end products that are normally sold at list price. The Bahamian economy is being hit very badly by the reduction in traffic (mainly from the US), and there are serious concerns about what happens from hereon.

Was a great stay nevertheless. If anyone wants a recent update on anything at the resort, please let me know.

 

[rsnash]

We won a trip to The Cove at Atlantis and I scheduled our stay for May 2009. I hope it's still open then!

 

[komosatp]

We won a trip to The Cove at Atlantis and I scheduled our stay for May 2009. I hope it's still open then!

Atlantis closing is not really a concern....it's a huge investment and even if it were to go a bankruptcy route (which is not even in the realm of remote possibilities at this point), it would still be operated as a resort. There's no way to make money off of an empty hotel room.

The concern is that there will be change....change that could be for the worse....but could also be for the better.

 

[komosatp]

Was a great stay nevertheless. If anyone wants a recent update on anything at the resort, please let me know.

What's going on over in the Beach Tower area? Are the sharks, turtles, and rays still in all those lagoons?

Was the River Pool, Lazy River, Kiddie Pool, and/or Goombay slide open?

 

[tombo]

Casinos are hurting bad everywhere. There are 2 casinos in Mississippi near where I live owned by a Choctaw Indian tribe. They just shut one of the 2 casinos rooms and fired the employees. This is the newer of the 2 casinos being built brand new in 2002. The gaming will be open from Friday afternoon until about 3 am monday.
Also from articles below:

"Harrah's also downsized its planned Margaritaville project in Biloxi, reducing the size of the project and scaling back from $700 million to $500 million. Gregory said $110 million has been invested in the site, but construction stopped several months ago. Across the country, other large casino projects have been shut down, Wells said."

http://www.clarionledger.com/article/20090107/BIZ/901070351/1005

http://www.meridianstar.com/local/local_story_005234620.html


If you had told me 12 months ago that casinos would be hurting, laying off, and shutting, I would have thought you were crazy. I thought gambling like alcohol and tobacco was almost recession proof. Obviously that is not true.

Currently Atlantis is almost giving away rooms begging people to come stay there. At 40% occupancy I would bet they would sell if they could find a buyer. Closing the Atlantis resort is an option too. When they run through their capitol and can no longer borrow money they will have no choice but to shut. No business can operate at a loss indefinetelly.

 

[Twinkstarr]

Right after the Dubai location opened up, I did hear some talking on CNBC that that the Bahamian location might be for sale. Haven't heard anything else or read(Wall St. Journal) any sort of follow up on the rumor.

 

[komosatp]

When they run through their capitol and can no longer borrow money they will have no choice but to shut.

Right...when oil stops flowing out of the middle east...that's when Sheik Maktoum will run out of money. Until then operating Atlantis with marginal operating losses is the best thing to do.

You did know that he was partners with Sol Kerzner at Atlantis, right?

Currently Atlantis is almost giving away rooms begging people to come stay there. At 40% occupancy I would bet they would sell if they could find a buyer.

That's an interesting statement...where have you seen specials?

The places I monitor the situation, people are complaining about the opposite: Atlantis isn't discounting nearly as much as people want/expect given economic conditions.

I've been concluding that Atlantis is seeing weaker bookings than normal, but that they're comfortable with their occupancy levels and the cruise traffic in Nassau, and don't have to have huge discounts to still adequately fill the place.

People accuse Sol Kerzner and Sheik Maktoum of many things, but being stupid and throwing away money is not one of those accusations. They're very smart business people, and I'm sure they're on top of the situation.

No business can operate at a loss indefinetelly.

See the airline business.

 

[rsnash]

That's an interesting statement...where have you seen specials?

The places I monitor the situation, people are complaining about the opposite: Atlantis isn't discounting nearly as much as people want/expect given economic conditions.

That's what I was thinking. They advertise these huge discounted specials, but have you tried pricing a vacation there on their website? I think it's like holiday sales where the regular prices are jacked up so that the discount looks bigger!

 

[tomandrobin]

I actually just got a mailer yesterday. It was a pretty good deal for rooms during the next couple of months.

Plus it was advertising some tournaments coming up....slots, poker, MJ Golf Tournament and such.

 

[JeffW]

Long term to me, Atlantis seems to be in good shape. Is it's occupancy any worse than any other other similar location? Hawaii is likely worse, as you have to fly to get there. At least with Atlantis, you can get their via boat.

 

[tombo]

Right...when oil stops flowing out of the middle east...that's when Sheik Maktoum will run out of money. Until then operating Atlantis with marginal operating losses is the best thing to do.

You did know that he was partners with Sol Kerzner at Atlantis, right?

That's an interesting statement...where have you seen specials?

I did not know that Kerzner had a Sheik as a partner. That means that they can operate for a longer period of time than I assumed, but just because someone can afford to operate long term at a loss doesn't mean that they will do so. The airlines survived long losses with government help and many filed bankruptcy. Now they are cutting flights like crazy and raising prices even as fuel costs have dropped. In addition, many people have to fly for work and to visit family and friends. No one has to stay at Atlantis or any casino.

The ad I saw on the Atlantis web site had 4 days and 3 nights for $499 and that sounded very cheap for Atlantis. I didn't read that it said per person double occupancy. Upon closer inspection I agree that the discount on rooms at $998 a couple for that stay is not nearly low enough. I am very surprised considering the hundreds of workers laid off and the low occupancy rates that the special is that expensive. Time will tell, but even with a sheik as a partner I would be surprised if they don't do some drastic things (close parts of the resort, close pools, etc) to try and stop the bleeding. If they can't stop the bleeding they will find another venture to invest their time and money in that is profitable.

 

[tombo]

Long term to me, Atlantis seems to be in good shape. Is it's occupancy any worse than any other other similar location? Hawaii is likely worse, as you have to fly to get there. At least with Atlantis, you can get their via boat.

This article has Vegas Occupancy rates through 2007 of a low of 84% to a high of 90.4%. I think that is a long way from 40% occupancy levels. Many articles talk of Vegas resorts hurting badly with 70% to 75% occupancy levels and many resorts are for sale.

http://cber.unlv.edu/tour.html


This article describes how Vegas has overpriced itself hurting the numer of gamblers and profits. Will Atlantis do better? Time will tell.

http://www.latimes.com/news/nationworld/nation/la-na-luxury-vegas25-2008dec25,0,303714.story

This article is predicting doom and gloom because last weeks occupancy rates in Hawaii were down to 66% which is a 10 year low.

http://www.travelagentcentral.com/u...-rates-inspire-deals-and-special-offers-11578

There are many articles to read about the dismal room occupancy rates of late 2008, but none of the resorts I have read about have levels as low as 40%. In addition most resorts are slashing room rates to try and increase occupancy. If Atlantis feels they are too good to drastically reduce their rates, more travelers will choose other locations and their occupancy levels will go even lower IMO.