The Siegel Group, a commercial real estate company that specializes in the disposition and development of underperforming assets with significant turnaround potential, recently partnered with a small private investment group to purchase a foreclosed Las Vegas hotel for $4.2 million.
The former Atrium Suites Hotel was closed in order to begin a large-scale renovation, which was only partially completed when the lender, Lehman Brothers, filed for bankruptcy protection with approximately $66 million in secured debt not including investor equity, encumbering the property.
Subsequently, this $66 million note was acquired in bankruptcy court by the current seller, which foreclosed upon the property last July.
In 2007, the hotel was acquired for $50 million with an additional $16 million financed for construction projects.
“The acquisition of the former Atrium Suites is a phenomenal opportunity for our organization and a great ending to 2011,” said Stephen Siegel, founder and CEO of The Siegel Group. “While the last few years have been extremely challenging for us, we continue to aid the market’s recovery by acquiring distressed and non-operational properties that we are able to reposition and stabilize.”
Atrium Suites Hotel is a six-story, 162,000 square-foot property situated on approximately 3.75 acres of land in Las Vegas. Other features of the hotel include a banquet facility, a full-service restaurant, hair salon, fitness facility, outdoor pool and a bar area.
According to Siegel, the company will immediately begin design and business concepts in engaging talks with several large hotel brands interested in the Las Vegas market. Potential uses for the vacant property can be a boutique hotel concept that complements the other hotels The Siegel Group holds like the Rumor Hotel, The Artisan, The Resort on Mt. Charleston and Gold Spike Hotel & Casino, or it can be operated under a national hotel flag.
The Siegel Group plans to make a decision on the future of the property sometime in the first quarter this year.
Siegel said the company’s acquisitions have resulted in an increase of jobs in Las Vegas, which is essential to any local and national economic improvement.
“In addition to the approximately 900 local jobs that The Siegel Group has created over the last few years, this newest acquisition will result in the creation of between 200 to 300 new full and part-time positions for Las Vegas residents,” Siegel added. “We plan on continuing our efforts in this recovery solidifying our long-term commitment to this city.”
