Neonopolis owners ‘pursuing’ audit

Sito Negron

Friday, March 12, 2004 | 11:05 a.m.

The owners of embattled downtown mall Neonopolis replied to Las Vegas Mayor Oscar Goodman's demand for an accounting Thursday, in a letter stating that they're "diligently pursuing" an audit and disputing the mayor's assertions of discrimination and other breaches of contract.

Goodman sent the Feb. 23 letter, in part, because Neonopolis did not lease space to Donald Troxel, an Ohio businessman who planned to open a gay cabaret-style nightclub modeled after his successful venture in Dayton.

According to Goodman, that places Neonopolis in default of an "obligation to refrain from discrimination," which is part of the contract with the city. The city has a $32 million investment in the $99-million mall, including $15 million for the parking garage.

The letter gave the operators of Neonopolis 30 days to deliver an audited statement of net operating income for the mall's first year, and to explain the discrimination against potential tenants and its failure to develop an "urban entertainment center" at the complex, which is at Fremont and Las Vegas Boulevard.

"We want to assure you that our client takes each of these allegations of default seriously and that our client intends, in all events, to comply with the terms of the relevant agreements between the governmental authorities and WEC," the letter reads. WEC stands for World Entertainment Centers, the Prudential Financial company that owns Neonopolis.

Goodman's spokeswoman Elaine Sanchez said Friday morning that Goodman forwarded the letter to City Attorney Brad Jerbic and City Manager Doug Selby for review.

Goodman is particularly "interested in knowing Brad Jerbic's analysis," Sanchez said.

Goodman said he has long had concerns about the mall's performance, which he has blamed, at least in part, for the lack of revenue from the city-owned, 600-space garage. City officials recently said they'd have to use $400,000 from the general fund to pay the debt on the garage.

In particular, the mayor criticized Neonopolis in June when it leased some office space. He said Neonopolis management appeared to not be focused on developing the mall as an entertainment complex.

The letter responds to that concern, noting that Article 5 of the Disposition and Development Agreement and the Redevelopment Agreement "permits the use of portions of Neonopolis for administrative office uses."

Theresa Miller, spokeswoman for Prudential Financial, said her company is reviewing preliminary work performed by a consultant to determine how to make Neonopolis successful.

"We're looking at some things and haven't come to a conclusion yet," Miller said. "There's nothing to share at this point."

Miller said that Neonopolis has a new leasing agent, and three staff members -- an office manager, receptionist and engineers -- at the mall, which has a movie theater, a bowling alley and two restaurants, as well as a number of smaller eateries and small retailers.

"Looking at how the mall is managed is part of the consultant process," said Miller.