Boob job

Bankrupt, 38-year-old Hooters Hotel got a two-month reprieve yesterday, as owners obtained a judge’s permission to keep spending creditors’ monies to keep the place open for an additional two months. That will at least give employees time to update their resumes. Majority creditor Canyon Capital Realty Advisors, however, is not amused by Hooters’ sagging financials, which have been drooping steeply since late 2007. In particular, subsidiary Canpartners takes exception to increases in executive pay at a time when rank-and-file salaries were cut over 25% and nearly 40% of employees were pink-slipped, to the point where Hooters has fewer full-time employees (605) than hotel rooms (696). In one instance, the timing of a $116K salary boost has at least the unbecoming appearance of a smash-and-grab raid to clean out the safe before bankruptcy was filed. Then again, perhaps Hooters’ braintrust believes that a CFO who has helped lead them into Chapter 11 deserves a 38% raise. You make the call.

Canyon’s endgame is clearly to force current leadership out and get Hooters firmly in hand — or at least cough those big salaries back up in the form of reinvestment. Of the three likely scenarios outlined by Steve Green (sale, takeover, reorganization), a ‘reset’ the leaves current management in place appears the least desirous, like continuing to stoke the boilers on a sinking ship. Any new equity that’s pumped into the fractured bow of the S.S. Hooters is just going to leak out astern. The property’s recent history makes no other conclusion credible. If I were creditor International Game Technology, I’d back a truck up to the place and start taking out my revenue-sharing games yesterday.

In early 2006, when the rebranded Hotel San Remo busted out its brand-new Hooters image, it seemed like a can’t-miss idea. (Then again, so did racinos in Florida, come to think.) Within less than a year, the makeover was already more bust than boom, never showing a dime in profit, and Hooters was being unsuccessfully shopped about at discount prices. In Sin City, where cocktail waitresses basically wear lingerie and hooker shoes, hot pants, tank tops and sneakers looked awfully tame. Revenues may not have been full-figured but longtime President Michael Hessling and cohorts managed to stave off the inevitable bankruptcy filing (initially threatened, appropriately enough, on a Friday the 13th) for four-plus years, which is an achievement in itself. Maybe that’s why he was feeling “george” toward CFO Deborah Pierce, now the company’s highest-paid exec. COO Gary Gregg must scrape by on an even 300 grand.

If creditors wound up losing over 70 cents on the dollar even before the page turned to Chapter 11, they’ve only themselves to blame. Good money was flung after bad, as Hooters sank to a debt:equity ratio that may be as lopsided as 16:1. However, would-be Canyon will have a devil of a time redeeming even the $43 million it’s buried invested in the rickety old property. There’ll not be much purchaser appetite for the site, even at $5.4 million/acre, unless …

… Onex Corp. wants the underlying land, which it might need. The Tropicana Las Vegas has an inadequate amount of surface parking (the best of it set aside for Nikki Beach patrons) and could really a new parking garage to replace its Munchkin-sized one. Since you almost have to walk to Hooters to get back to your car after visiting the troubled Las Vegas Mob Experience — where ticket prices have been slashed by 25% — it wouldn’t be that radical of an idea to extend the Trop’s “vehicular realm” into Hootersland. What Onex doesn’t need is Hooters’ alarmingly decrepit parking garage, its small, noisy pool area or its hotel towers. In an ideal world, if the Trop didn’t bulldoze the whole place, it’d knock down everything except the cozy casino itself and run the joint as a pure gaming play.

That might be feasible if the San Remo (whose hotel dates back to early in Richard Nixon‘s second term) is old enough to be grandfathered out of the 200-room statutory requirement or if the Trop could simply extend its gaming license, in brassiere-like fashion, to encompass both casinos. Wynn Resorts and Las Vegas Sands used that ploy to avoid getting discrete licenses for Encore and Palazzo, but those buildings were physically contiguous to Wynn Las Vegas and the Venetian, respectively. Onex might have to erect an long, long canopy, such as that which links MGM Resorts International crown jewel Slots A Fun with Circus Circus, creating the illusion of symbiosis. (Where’s Bob Faiss when you need him?)

The San Remo’s obituary was being prematurely written over 12 years ago, when I hit this town, as were those of the Sahara and Riviera. Hessling’s had a good, long tenure at the naysayers’ expense but now it really looks like the time has come to pull a sheet over the place. Casino cash flow is puny and as long as it’s a money-losing proposition (i.e., the foreseeable future), even $1 in debt is a dollar that’ll never be seen again. Let’s give this full-figured gal a proper funeral.

Speaking of can’t-miss concepts, who knew a topless C&W show at the Sahara wouldn’t work? Producer David Saxe didn’t, which is why he took an $800,000 bath on Fuck Buck Wild, as he freely admits. (That’s probably the only thing about Buck Wild that was free.)

Sheldon Adelson™ probably doesn’t know what Twitter is … but some of the money he’s been giving away sure does. D’ya think I could get Adelson to invest in my planned unicorn ranch? For such a smart guy, he can be an awful big sap sometimes. One of Adelson’s better recent moves has been to land Hilton Worldwide, which will operate a 636-room Conrad Macau as part of Sands’ next Cotai Strip™ megaplex. The Conrad is slated to debut early next year. Meanwhile, would-be participant Caesars Entertainment can but sit off to the side and stew in frustration.

But if there’s a company that makes it Las Vegas Sands look cutting-edge and hip, it’s sclerotic Columbia Sussex. The Westin Casuarina owner is making the news in a way it would rather not.

Up, up and away. If it’s not in Macao, at least Caesars got a consolation prize when its Project Linq was green-lit by the Clark County Commission. Handsome and long-overdue facelifts of Imperial Palace and O’Shea’s are major ingredients of the $500 million formula, which will rejuvenate a stale side of the Strip. Throw in an 1,120-passenger “observation wheel” and I wonder if Caesars isn’t lowballing the cost of project. The Ferris wheel may not be as much of a draw as projected: It’s sited in such a way that passengers will mainly get a view of nearby slums owned by Oscar Nuñez, as well as the backsides of several Strip hotels. The question of how emergency vehicles will cope with the loss of an access route appears to have simply been begged. But unless Wall Street is in a lending mood right now, all these questions will be moot.