Sahara Hotel Downsizes - Shuts down Two Towers

The Sahara Hotel closed two of its three hotel towers for the winter because of low demand. The hotel said that its other facilities will remain open according to the Review-Journal. The Tangiers tower with 1,720 rooms will be the only tower open.

The Sahara is privately owned by Los Angeles-based SBE Entertainment and a private equity firm, Stockbridge Real Estate Funds of San Francisco. The groups purchased the property in late 2007 for $331.8 million.

The Review-Journal reported that many of the second tier hotels in Las Vegas are reporting lower revenues. The Riviera's revenues decline 28.9% in the first nine months of the year. The Stratosphere's revenues fell 17% and Circus Circus saw its revenues drop 21.9%. Binion's Gambling Hall and Hotel closed its hotel rooms in December.

Las Vegas is beginning to see the effect of more room supply and less demand which has become acute during the slower seasonal periods. It has the greatest impact on the marginal properties.

John Laub is the CEO/President of the CEO-CFO Group.

1. "Sahara Closes Two Hotel Towers Due to Low Demand" Arnold M. Knightly. Las Vegas Review-Journal. December 15, 2009.