Nochi Dankner and Yitzhak Tshuva’s grandiose Plaza Center casino and hotel project on the Las Vegas Strip took another step towards realization today. Property and Building Ltd. (TASE: PTBL) has obtained letters of commitment from Credit Suisse Group (NYSE: CSR; SWX: CSGN; XETRA: CSGZ) and Goldman Sachs Group Inc. (NYSE:GS) to provide a $625 million loan to buy land for a real estate project in Las Vegas, as well as an additional $200 million loan at the company’s discretion.
Tshuva’s Elad Group Inc. and Property and Building, a subsidiary of IDB Holding Corp. Ltd. (TASE:IDBH), controlled by chairman and CEO Nochi Dankner are jointly planning the $4-5 billion, 3,500-room hotel, which also has 300 private residences, a conference center, and commercial space. Elad owns 52.5% of the project and Property and Building owns 47.5%. The companies bought the 35-acre site of the Frontier Hotel, which is slated for demolition, for their new hotel.
The $625 million loan will be in two parts. The bulk of the loan will bear LIBOR + 2.75% interest, and will be guaranteed with a first lien on the land. The rest of the loan will bear LIBOR + 4.5%, and will be guaranteed by a second lien on the land. The terms of the loan might be subject to change.
The additional $200 million loan will bear LIBOR +6%, which will be guaranteed by a third lien on the land. If Property and Building decides not to take this loan, it will finance the purchase of the land from shareholders’ equity. All the loans are for one year, with two six-month extensions under certain circumstances.
Published by Globes [online], Israel business news - www.globes.co.il - on July 30, 2007
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