Controversial LV home renter bankrupt

Grace Leong

Friday, March 29, 2002 | 11:34 a.m.

The entrepreneur who fought an upscale neighborhood near the Las Vegas Convention Center over his controversial vacation home rental business now wants to liquidate the business and has placed it in Chapter 7 bankruptcy.

Kyle Waugh, who owns Oracle Real Estate Group Inc. also known as Vacation Homes of Las Vegas, had the companies file for bankruptcy protection from creditors Wednesday in Las Vegas. The company listed assets of $1,000 and liabilities of $327,672 in the filing.

Waugh and his bankruptcy attorney, Kenneth Frizzell, could not be reached for comment on reasons behind Oracle's bankruptcy filing and to say if Vacation Homes -- which comprises 25 residences within the Las Vegas International Country Club Estates -- is still in operation.

Jason Goldwater, Oracle's former vice president and director of marketing who said he left the five-worker company in November because of "differences over Waugh's management practices," said Oracle suffered losses in bookings from potential conventioneers because of the Sept. 11 terrorist attacks.

Dawn Cica, president of the country club homeowners association, agreed. "We haven't seen a lot of rental activity since last summer. We know because Vacation Homes has to call us whenever they rent a home."

Goldwater said Waugh "did a midnight move out of the former Oracle office at 3900 Paradise Road, Suite 285 in October" and believes Waugh is now operating his vacation rentals business under the name Intimations Inc. doing business as Fairway Homes Inc. of Las Vegas.

Goldwater also attributed the company's filing to a series of "imprudent" property purchases over the years including that of the "White House" building in January 2001 that allegedly caused Waugh to be over-extended.

Goldwater said Waugh acquired the White House, an office building at 3260 Joe W. Brown Drive across the street from the Las Vegas Convention Center, for about $1.3 million and remodelled it as a private convention operation for about $700,000 even after his application for a special use permit and other approvals were denied by an advisory council and the Clark County Planning Commission.

"The White House is just an albatross because he bought it before getting the use permit. We couldn't line up potential clients because we couldn't operate the convention center without a special use permit," he said.

Cica agreed. "Perhaps his bankruptcy filing was due to the fact that he was unsuccessful in getting the permit for White House to operate as convention center and had spent a lot of money renovating the White House," she said. "He probably also had a lot of financial resources committed to litigation."

Waugh, who has been embroiled in protracted litigation with the country club since 1998 over his use of the 25 country club residences as short-term rentals for travelling business people and tourists, won a temporary restraining order in September to stop the country club homeowners association from enforcing certain new regulations that Waugh complained were selectively enforced.

Waugh had sued the homeowners association after it adopted new regulations including a rule that prohibits property owners from access to common areas in the country club if their homes have been rented to others. This case is pending in Clark County District Court.

Country club residents complained that Waugh's rentals to convention goers and tourists created a transient atmosphere that created excess noise and traffic in the country club, which is located directly east of the Las Vegas Hilton.

But Waugh, who said he had helped increase the value of the neighboring homes by spending more than $1.5 million to renovate his properties, argued the association's new restrictions prevented him from marketing his properties.

Clark County joined the legal battle in March 2001 when it sued Waugh and his companies for alleged non-compliance with a county ordinance that prohibits vacation rentals of less than 30 days in residential neighborhoods. This case is scheduled to go to trial in 2003.

Meanwhile, the Las Vegas law firm of Kummer, Kaempfer, Bonner & Renshaw, is listed as a creditor in Oracle's bankruptcy filing. Thomas Kummer said the firm had represented Waugh in a number of issues including his fight against the country club homeowners association and is still owed $52,731 for its legal work.

Another creditor, Glenborough Fund IX LLC, which sued Oracle in December and won a default judgment of $38,935 in January, is owed $36,645 in the filing.