Sahara: Devils in the details; Does your mother know?

Barbara De Lollis had better re-cork the champagne. Wall Street Journal coverage of Sam Nazarian‘s much-hyped, $300 million Sahara loan raises grave doubts about the viability of the project, budgeted at $415 million. According to Pulitzer Prize-winning reporter Alexandra Berzon, The Naz has nine months in which to raise the extra $115 million and its interest rate cannot exceed 6%. Since it took J.P. Morgan Chase only two weeks to scare up 300 mil, that should be a breeze, right?

Nazarian fixer-upper SLS South Beach.

Maybe not, when you consider the fiendish terms imposed on Nazarian for his 300,000,000 pieces of silver (thanks to S&G reader Howard Park for pointing this out to me) and the revelation that the announced “two weeks” were actually more like three months, says Chase boss Timothy Donahue. Smilin’ Sammy Naz “has agreed to pay investors a yield of 13% in order to get the loan financing done, according to a person familiar with the matter. That is among the highest rates for a Las Vegas casino loan, say Peggy Holloway, a casino analyst for Moody’s Investors Service.” The balance will have to come from overseas, via the EB-5 Immigrant Investor Program, which presents complications of its own.

Jobs for sale. The EB-5 angle means Nazarian really has closer to four months, since EB-5 is scheduled to sunset on Sept. 12. SLS Las Vegas would also have to meet a number of EB-5 criteria, although it would appear to just barely qualify. (Were it one block further north … ) The job-creation quota, however, is staggeringly low. Cordish Gaming raised some of the capital for Maryland Live! this way — perhaps 17% of the project’s $440 million tab. In return, some of Cordish’s employees will be “insourced” from China, undoubtedly much to the chagrin of Maryland job-seekers. Perhaps Gov. Brian Sandoval and Old Sixty Votes Reid should have tempered their celebratory rhetoric thusly: “SBE will create thousands of jobs … many of them Chinese.”

Berzon also gets to the bottom of one of the lingering mysteries behind Nazarian’s 2007 Sahara purchase. How much did he pay? Answer: $288 million (or $16.5 million/acre), an investment that inched up to $330 million before he shuttered the place last year. All of which drives the actual break-even point for SLS Las Vegas to nearly $750 million, plus interest. Do Sahara Sam and new sidekick Colony Capital really believe they can drive $150 million in cash flow from that location? Even Aria isn’t generating EBITDA at that pace, judging by MGM Resorts International‘s 1Q12 results.

Sinkhole de Mayo? I’ve been getting slammed with press release about Casino X’s special Mother’s Day menus and Casino Y’s Mother’s Day promotions. But what have I not been seeing promoted? Anything to do with Cinco de Mayo. Oh, there are a few May 5 bashes on the Strip but Vegas casinos are doing a piss-poor job of getting the word out. (I’m not sure what the proudly Greek Maria Menounos has to do with Cinco de Mayo but give the lady mad props for her tenacious ascent of the Dancing with the Stars leader board.)

Not only is Southern Nevada somewhere between 25% to 33% Latino, Vegas’ biggest growth story during the recession has been tourism from … Mexico. Kudos to MGM, Caesars Entertainment, Penn National Gaming, Ed Roski, Michael Gaughan and Phil Ruffin, who are among the casino owners showing the flag. Conspicuously absent from LVA‘s event listing are — to name a few — Wynn Resorts, Las Vegas Sands, Boyd Gaming and Station Casinos. For shame, gentleman.

Congratulations to longtime Palms spokesman Larry Fink, who’s abandoning that sinking ship in favor a gig with Robert Earl. Fink is moving to Los Angeles to become vice president of celebrity entertainment at Planet Hollywood International. Since the latter has several Las Vegas footholds (including Buca di Beppo), I’m sure we’ll hear from him periodically.