This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Hard Rock is Low on Chips With Debt Payment Due

Making matters worse on April 24 was BREF's disclosure that its CFO, Marlo Vandemore, had resigned to pursue other opportunities.

In the annual report, BREF disclosed a $105.5 million net loss for the year ending Dec. 31 and a $115.6 million net loss in 2012.

Before the transfer in lieu of foreclosure, the hotel and casino were owned by Hard Rock Hotel Holdings LLC, an entity that was formed by DLJ Merchant Banking Partners and Morgans Hotel Group (MHGC - Get Report), to acquire the hotel in 2007.

In 2011, Hard Rock Hotel Holdings received a notice from its lenders and its second mezzanine lender, NRFC WA Holdings LLC, declaring all of its debt due immediately. The lenders filed a lawsuit to foreclose on the company's assets in the Supreme Court of New York, but the hotel and casino was later transfered to the new owners instead of the foreclosure moving forward.

Must Read: Berkshire Lieutenants Poised For Role in DirecTV Takeover

Through the transfer, BREF assumed the company's then $862.8 million in debt and secured a new $30 million second-mortgage from Brookfield Financial. The $862.8 million has grown to a $902.5 million debt when interest and other charges are considered.

The $30 million second mortgage, meanwhile, is priced at 15% payable at maturity, which is also March 1, 2018.

The Hard Rock Hotel & Casino has three hotel towers with approximately 1,500 hotel rooms, a 60,000-square foot casino, a Hard Rock retail store, a jewelry store, two clothing stores, a lingerie store, and a tattoo parlor. The hotel and casino also has a special events facility, a nightclub and live music concert hall, among other amenities.

The company, which has 1,397 full-time employees, operates under the Hard Rock brand through a licensing agreement with Hard Rock Cafe International (USA) Inc.

BREF, which has $604.23 million in assets and $804.77 million in liabilities, has a $200.6 million deficit. It has roughly $14 million in cash on its balance sheet, SEC filings said.

A spokesman for Brookfield Asset Management, Andrew Willis, declined to comment.

A spokeswoman for the Hard Rock Hotel & Casino couldn't immediately be reached for comment.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
MHGC $1.19 0.00%
AAPL $94.02 0.00%
FB $104.07 0.00%
GOOG $683.57 0.00%
TSLA $162.60 0.00%


Chart of I:DJI
DOW 16,204.97 -211.61 -1.29%
S&P 500 1,880.05 -35.40 -1.85%
NASDAQ 4,363.1440 -146.4150 -3.25%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs