Phil Ruffin’s nearly 10-year run as a casino magnate on the Strip is officially over.
He signed the final papers Aug. 7, selling the 34.5-acre New Frontier property for USD 1.24 billion, according to the Wichita (Kan.) Eagle, his hometown newspaper.
Ruffin paid USD 167 million for the property in October 1997. His purchase brought to an end four months later what had been a bitter six-year labor strike.
The site is now owned by Elad IDB Las Vegas, a joint venture between New York-based Elad Group and Property & Building Corp., a subsidiary of Israeli-based IDB Holdings Corp.
A spokesman for the Elad Group confirmed the closing of the sale, but declined to comment further.
The New Frontier will be imploded this fall to make way for a USD 5.7 billion mixed-use development modeled after the Plaza Hotel in New York, which Elad Group owns.
Elad, a privately real estate development company controlled by Israeli billionaire Yitzhak Tshuva, owns a 52.5 percent equity share in the Strip project, according to an Israeli-based business journal.
Property & Building took out a USD 625 million loan to secure its 47.5 percent equity investment.
The loan is backed by Credit Suisse and Goldman Sachs, with an additional USD 200 million available for development.
Three loans will be taken against the land to support the loans.
The bulk of the loan will be at the benchmark lending rate plus 2.75 percent, the second at a benchmark lending rate plus 4.5 percent with the USD 200 million at a benchmark rate plus 6 percent.
Subsidiaries of Elad and IDB provided an additional USD 100 million in loans with an additional USD 400 million in shareholder equity.
Both Property & Building and its parent company, IDB Holdings Corp., are publicly traded on the Tel Aviv Stock Exchange.
The partnership is planning a mixed-use development with 3,500-room hotel with 300 private residences. The Plaza will be complemented with convention space, retail and restaurants.
The Elad Group now faces two separate lawsuits in Nevada courts tied to the deal.
Resort Properties of America filed a federal lawsuit on July 23 seeking USD 12 million plus damages for unpaid brokerage fees related to the sale.
Elad said through a spokesman Resort Properties President David Atwell was not engaged to act as a broker and „did not earn and is not entitled to a commission.“
Atwell said he received an offer to settle on Friday but rejected it as too low.
A second lawsuit was filed in district court Thursday by Tamares Las Vegas Properties, owner of the Plaza downtown on Main Street, citing ownership of six Nevada trademarks of the Plaza name tied to use with a casino, hotel, bar and restaurants.
Elad said it had not yet been served with the lawsuit and declined to comment.