Lake Las Vegas resort posts loss, but beats expectations

David Strow

Tuesday, June 19, 2001 | 10:27 a.m.

The Hyatt Regency hotel-casino at Lake Las Vegas recorded a net loss in its first full year of operations, though its owners and operators say the resort is performing ahead of expectations.

In its annual report, Cook Inlet Region Inc. of Anchorage, Alaska, said it recorded a $6.2 million loss from the 496-room, $150 million Henderson resort casino in 2000. CIRI owns 50 percent of the resort, which opened in December 1999. No further financial information was made available.

Dennis Brandon, vice president of tourism for CIRI, attributed the loss to interest and depreciation costs.

"We anticipated and planned for losses at the beginning," Brandon said. "From an operating standpoint, we're very pleased with the activity taking place."

Dan Amato, general manager of the property, said the Hyatt is running $2 million ahead of its revenue projections so far this year, and is also ahead of expectations for cash flow. He didn't disclose additional financial information.

"We're basically blowing away last year's numbers, from revenue to occupancy to volume of business to groups in house," Amato said. "Every statistic is up considerably from last year."

Occupancy is averaging 75 percent so far this year, Amato said, a 20 percent boost over 2000, with average room rates running in the "mid $100s." Strong group business, growing individual traveler business and traffic directed from the Hyatt chain are all factors, Amato said.

Brandon said CIRI expected it would take three to five years for the project to stabilize and achieve profitability, but now estimates the Hyatt Regency could be operating in the black as early as next year.

"The gross operating numbers are good, and are actually showing some very positive signs. "We're pleasantly surprised with the results compared to what was originally forecast for 2001, and have made some positive adjustments to those (expectations) already."

Amato and Brandon hope the summer movie season could provide another boost for business. July will see the release of "America's Sweethearts," a film starring Julia Roberts and John Cusack, that was filmed at the Hyatt. Hyatt is promoting the film and the Lake Las Vegas property in mailers to 200,000 regular customers, and the resort is selling $99 hotel packages themed after the film.

The film refers to the hotel as "Hyatt Regency Lake Nevada."

"We're starting to get a lot of phone calls from people who have seen the trailer," Amato said.

CIRI is an investment firm whose shareholders are Alaska natives and Indians living in the Anchorage area. The Hyatt is one of the company's few tourism investments outside of Alaska, though the company last year invested in the $500 million Village at MonteLago, a Lake Las Vegas resort that will consist of a 350-room Ritz-Carlton hotel, a 40,000-square-foot casino, 900 luxury condominiums, 125,000 square feet of retail space and 50,000 square feet of office space.

"When you've got a market that brings in 35 million visitors annually, the strength of Las Vegas as a destination ... it just made a whole lot of sense for us to take a serious look, make a bold more and become more diversified than in the past (by investing in Lake Las Vegas)," Brandon said. Outside of these investments, Brandon said CIRI isn't actively considering any investment opportunities in the Las Vegas area.