- Dreamscape Companies LLC is scheduled to take over operation of their Rio Las Vegas property from Caesars Entertainment at some point before 2023.
- Dreamscape has previously indicated that they are planning to renovate the iconic Las Vegas property.
- Late last week, it was announced that the hotel component at the Rio will operate under one or more Hyatt owned brand names.
The Rio Las Vegas has clearly seen better days. At one point, it was among the hot properties in town and a lock to win annual competitions for ‘Best Casino Sign’. That all changed when original owner Tony Marnell sold the property to Caesars Entertainment in 1999. It quickly got shuffled to the back to the Caesars portfolio to the point that in 2019 original owner Marnell told the Las Vegas Review-Journal: “The Rio needs a little TLC and it hasn’t gotten a dime’s worth.”
For the past few years, there has been constant speculation about the fate of the Rio. That only intensified when Caesars sold the property to Dreamscape in late 2019 for $516.3 million USD. The purchase agreement allowed Caesars to continue management of the Rio for two years at an annual rent of $45 million with an option for a third year at $7 million. That agreement has been extended by an extra year due to the COVID-19 pandemic but what is known is that Dreamscape will take over operation of the property by late 2023.
What would happen at the takeover date became a subject of much speculation. Although the ultimate fate of the Rio was unknown the consensus opinion was that it would be sold, imploded and used for something else. Few were of the mindset that it had any future as a gaming property and the most interesting speculation was that it would end up being the site of a baseball stadium to be used to lure a MLB team to Southern Nevada.
In early January, Dreamscape LLC executives Eric Birnbaum and Thomas Ellis revealed some of their plans for the Rio at a suitability hearing in front of the Nevada Gaming Control Board. Birnbaum indicated that the Rio was due for a ‘monster refresh’ along with a revamping of the food/beverage/entertainment mix that will work the best going forward. Few details have come out beyond that–until now.
On Thursday, a press release from Hyatt Hotels Corporation (NYSE: H) fleshed out some of the plans for the lodging operations at the Rio. The plan is for a Hyatt affiliate to take over operation of the hotel component including a rebrand into ‘multiple Hyatt-full service brands’ starting with the Hyatt Regency. Here’s what the announcement said about plans for the Rio:
The more than 2,510-room Rio Las Vegas will be renovated and rebranded into multiple Hyatt full-service brand flags, and will undergo a redevelopment of the current public spaces, including gaming, retail, food and beverage, spa and fitness, and pool recreation deck. In addition, the Rio Las Vegas will undergo a renovation of one of the hotel’s existing towers, and upon completion, the tower is expected to become a 1,501-room Hyatt Regency hotel with standard guestrooms averaging 580 square feet. The remainder of the Rio’s guestrooms are expected to be branded or affiliated with one or more other Hyatt full-service brands after they are renovated. Beyond redefining the hotel experience for business travelers and leisure guests, the Hyatt Regency hotel and other Hyatt-affiliated hotels will welcome meetings and event business with more than 220,000 square feet of function space and state-of-the-art meeting facilities.
Most likely, the casino operations will be handled by a third party management company much like the setup at Virgin Hotels Las Vegas where Mohegan Gaming and Entertainment runs the gaming floor with Betfred Sports USA in charge of the sportsbook.
Kimo Bertram, Hyatt’s vice president of real estate and development, is thrilled to plant his brand’s flag in Southern Nevada:
“We are thrilled that Dreamscape will help us bring multiple Hyatt full-service brands to Las Vegas, starting with a Hyatt Regency hotel, which we believe will deliver on the Hyatt Regency brand promise of creating meaningful connections in modern spaces designed for sharing, socializing, and collaborating. We know Las Vegas is an important destination for our guests, World of Hyatt members, and customers, and this project is a significant step for Hyatt as we continue to grow our brands in markets that matter most to our loyal travelers.”
Eric Birnbaum, Dreamscape’s founder and CEO, is pleased to get Hyatt on board as his company sets out reviving the Rio:
“At Dreamscape, our goal is to acquire assets that drive long-term financial and cultural value, and we are very excited to team up with Hyatt on this project. The Rio Las Vegas is the perfect space to create the ultimate multipurpose venue in Las Vegas, and we are thrilled to work with the Hyatt team to revitalize the property.”
It’ll be great to see the Hyatt brand in Las Vegas. I’ve been fortunate to travel a good deal during the COVID-19 pandemic and over the past year or two Hyatt has become my ‘go to’ hotel option. I’ve really been impressed with the quality and consistency of their operations–to the point that I’m now a Hyatt stockholder. The Las Vegas market is slowly but surely moving out of the ‘pack ’em in like sardines’ mentality that has plagued the city’s hotels for too long. The addition of Hyatt to the mix can only help as Las Vegas tries to upgrade hotel offerings to match the city’s world class dining, shopping and entertainment.
At the time of publication, James Murphy has a long position in H.