Owners of the Lucky Dragon Las Vegas have filed in U.S. Bankruptcy Court for permission to close after an auction earlier this month failed to attract a buyer for the struggling 203-room casino hotel.
Snow Covered Capital, the principal investor behind the Asian-themed resort on Sahara Avenue, the city’s first ground-up gaming development since the Great Recession, told Judge Laurel Babero that in the absence of any qualified bids, shutting down what’s left of the business will give “the remaining employees clarity with respect to their job futures” and “better ensure the orderly transition” of ownership to Snow Covered Capital. If granted, the request will immediately halt remaining salaries and any payments to vendors.
Widely hailed at the time of its 2016 opening as the herald of a new generation of strategically themed boutique casinos, Lucky Dragon featured multi-lingual staff and signage, a casino floor heavy on baccarat, pai gow, and sic bo and a range of authentic food and beverage options that included the region’s first tea sommelier.
But its location far north of the main Strip action proved a burden, and the gaming operation couldn’t compete with the large Strip resorts in meeting the expectations of its Asian target market in terms of comps and other services. By January of this year the casino and most of the remaining restaurants were shuttered. The same month, developer Andrew Fonfa sought bankruptcy protection for the property after defaulting on a $90 million loan to Snow Covered Capital.
Left in the lurch, meanwhile, are some 179 investors Fonfa recruited from outside the U.S. to kick in $89.5 million to Lucky Dragon’s construction through the federal government’s EB-5 visa program, which affords foreigners the possibility of permanent US residency for themselves and their families in exchange for investing a minimum of $550,000 in capital projects that generate domestic jobs. Their status is now in doubt. The EB-5 program also requires that investors maintain their ownership stakes for a certain number of years, which is problematic as well given Lucky Dragon’s uncertain future.
Attorney Ryan Works, who is representing them, said he’s “hopeful we can preserve some equity for these folks, but also I’d like to see the immigration process succeed for all”.
