City, Lady Luck owners enter talk over development

Dan Kulin

Thursday, June 9, 2005 | 10:23 a.m.

Las Vegas and the owners of the Lady Luck hotel could enter into negotiations for the development of the land around the old downtown post office, including a park that has become a popular hangout for the homeless.

The City Council is expected to vote Wednesday on a proposed exclusive negotiating agreement with the Lady Luck, which would give the downtown hotel 180 days to come up with a plan for the property along Stewart Avenue, City Manager Doug Selby said.

The casino operators want to use the park as a staging area for a construction project at the Lady Luck, but their specific long-term plans for the property are not known, Selby said.

The Lady Luck is co-owned by Councilman Michael Mack's brother-in-law Andrew Donner. Mack said he would abstain from the council action and discussion of the Lady Luck related items, as he has in the past. He also said he was not familiar with the requests from the hotel.

Donner did not return telephone messages left at his office Wednesday, but his business partner, Robert O'Neil, said they want to create a development that would tie in with the city's plans for downtown and the old post office.

"At this point we'll hire guys and then they'll come up with the ideas," O'Neil said. "It could be a little retail, a little nightclub, a little hotel space, or whatever else they come up with."

The old post office is in the process of being renovated, and there are plans to turn it into a museum.

Selby said the proposed negotiating agreement would be for roughly 5.5 acres that includes the Downtown Transportation Center and the park, which is called Frank Wright Plaza, named for the late Nevada historian. The proposed agreement would require a $100,000 deposit from the Lady Luck officials, which would be returned if negotiations go smoothly regardless of whether a development deal is struck.

Selby said the park, which is across Fourth Street from City Hall, was intended to be temporary when it was transformed from a parking lot two years ago.

Now, Selby said, the park has become a "homeless haven," and the possible development creates the potential for the space to be turned into "something vibrant."

"It is no longer an asset to anyone visiting downtown," Selby said of the park. "They could revitalize that resource."

Development plans for the land occupied by the Transportation Center would have to wait until a new terminal opens near the Plaza hotel, Selby said.

The council is also expected to vote Wednesday on a proposal to lower the security deposit the Lady Luck has paid as part of the 20-year-old lease on a city-owned parking garage south of the casino on Ogden Avenue, Selby said.

The security deposit is now $360,000, and the casino operators are requesting that the deposit be lowered to $100,000, according to city documents.

Selby said city staff are recommending the council approve the request because the hotel pays the rent -- now $527,076 a year -- in monthly installments instead of annually as it once did. This means the city's financial risk in the lease agreement is less than it once was, Selby said.

O'Neil said they want the change to free up money that could be reinvested into the 750-room hotel across the street from the post office.