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Tuesday, Jan. 19, 2010 | 8:33 a.m.
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The owner of the Krave nightclub and Harmon Theater in Las Vegas filed for bankruptcy reorganization Monday, saying it's behind on rent and tax payments but that its financial situation should improve because CityCenter has revitalized the area.
Krave Entertainment LLC President Sia Amiri said in court papers that the businesses at the Miracle Mile Shops at the Planet Hollywood resort on the Las Vegas Strip suffered last year because of the recession and construction on Harmon Avenue and CityCenter. When it opened in 2004, the 17,000-square-foot Krave billed itself as the first gay/lesbian/alternate lifestyle club on the Strip.
Because construction limited access to the venues last year, the Harmon Theater lost three of its variety shows. The venue now has two shows and another is set to begin, Amiri said in the bankruptcy filing.
Things are looking up now with last month's opening of MGM Mirage's CityCenter complex, he said.
"CityCenter revitalized the entire area, and debtor’s operations are now located at a prime site on the Las Vegas Strip. The new road route is expected to facilitate customer access," Amiri said in the filing. "With respect to the Harmon Theater operations, debtor plans to book more shows and fill up capacity. With respect to the nightclub operations, the Krave brand name is popular with its clientele, and debtor plans to revamp its marketing plan and add new events."
Amiri said he and co-owner Kelly Murphy were unable to raise capital to cover losses in late 2009 because of liens filed against them by the Nevada Department of Taxation related to their personal guarantees of the businesses' tax obligations.
The company is cash-flow positive on an operating basis and filed for bankruptcy to restructure its obligations, Amiri said.
The company listed assets of $153,416 against liabilities of $3.5 million -- including some $485,000 owed to the Nevada Department of Taxation and Division of Industrial Relations for sales, entertainment and unemployment taxes; and about $601,000 owed to the IRS for payroll taxes.
Another $847,000 in back rent is owed to landlord IRALP Inc., the bankruptcy filing says.
Sure doesn't sound like positive cash flow to me. But then again if you dont pay your rent and payroll taxes cash flow had better be positive.
I think it has to do with over priced drinks and entry fees..
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When your customers are charged outrages prices, they usually do not return. John Q Public will only allow so much gouging before finding an alternative. The strip resorts are luring visitors with cheap room rates and then sticking them with high prices everywhere else, it will backfire. Go to the southpoint for value, its the only place on the strip where you dont feel like your being ripped off. Nightclubbers have no money, they just take up space, the more you charge, the less space needed.
I've never been to these places, BUT I still think it's sad that due to actions by the city that dragged on and on and on, more small businesses go into bankruptcy. Yes I know he'll reorganize and life will be good. But what about the other smaller businesses in that area? How many of them went under quietly? And just fyi - Southpoint is NOT "ON THE STRIP". It may have the LVBlvd address but it isn't even close to "the strip". I'm still laughing at that one consultantd - altho you do a darn good job of posting on every story to get your little ads out for southpoint.
If Kelly Murphy is the CFO of Krave how come he didn't (want to) sign on the bankruptcy filing?
The ironic thing in this story is the "so-called" problem that Harmon Ave had due to City Center construction. Yes the road may have been closed to cars, however what is not stated is that fact that pedestrian traffic was diverted off Las Vegas Blvd and put right in front of Krave and down thru the Miracle Miles Shop entrance. So in reality the construction increased foot traffic by an outstanding amount. A place that never sees foot traffic due to bad location then gets a huge flood of foot traffic and it still fails? That shows more about the company itself and its management then any so called construction woes.
Krave is bankrupt cause they didn't pay their "Back" taxes. So ironic, don't u think?
i remember when the sidewalk and street was closed, it was annoying trying to get to krave for a while. i usually go twice a week and i think its a great club, its the only place i go where employees remember me. i went last night and asked a few staff members what was going on and everyone said the club is fine and not going anywhere. one also told most of their problems came from old owners.
(Bankruptcy docs, page 4)... IRALP, Inc $847,599.64 owed in back rent... not disclosed that they are the not just the landlord but the shareholders and owners of the Krave Entertainment... where did all the cash go? only 10k in the bank...???
I worked for KRAVE, operating lights for the nightclub, as well as several shows including Little Legends, the Amazing Jonathan, and the show Fetish, and I can speak from first hand experience that when it comes to paying employees, Kelly has a VERY hard time producing the checks, and even when he does, they bounce. It got extremely out of hand when he neglected to pay multiple workers for several weeks, then he shows up in a BRAND NEW YELLOW CORVETTE!! And still, all the checks we received were bouncing left and right. I don't think the financial situation of KRAVE rests in it's revenue problems, I think there's some "sticky fingers" handling the money. If I were Sia, I'd have a thorough investigation set up, with Kelly being the center icon of that investigation. KRAVE's problems are much more than what is presented in the media. Someone should look in to this situation.
JDW hmmm.. Josh Wurzbach right? Aren't you the one who organized the union that cost Krave over $100,000 in legal fees? Thanks oh and your straight so yea.
I am glad the handful of bashers on here DONT go to Krave you are obviously not apart of the 700-1200 people there every Friday and Saturday. The fact that you would want the ONLY gay nightclub on the strip, an icon to close is sad. I would guess everyone here is straight or just haters.
also, if you have the intellgence to use goolge you would know that Krave was DAYS AWAY FROM CLOSING until Kelly stepped in. So go ahead and talk your trash but Krave isn't going ANYWHERE weather you like it or not. So stay at home on your blogs and comment sites and sulk. You obviously don't belong to the community.
-gayandproud
oh sure, big shot Kelly Murphy "appeared" in Vegas in 2002 and guess how he "made big his money??" all his life? IRS and other govt agcies, look into it asap.
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wow, i just saw some postings about Kelly Murphy. I hope he stays calm because the heat is going to get turned up. I used to work for Murphy at Rancho Hardaware that he bk.
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