Las Vegas: Fontainebleau and Rio seek regulatory approvals, change in operators

July 6, 2023 9:09 PM

Las Vegas: Fontainebleau and Rio seek regulatory approvals, change in operators

Photo: Mark Mediana, DREX Agency (courtesy)
  • Buck Wargo, CDC Gaming Reports
July 6, 2023 9:09 PM

The Fontainebleau Las Vegas is moving forward with its regulatory approvals ahead of opening in December and its executives will take centerstage next Wednesday, along with those of Rio All-Suite Hotel & Casino ownership group Dreamscape Companies, which is seeking a gaming license to operate the off-Strip property.

The Nevada Gaming Control Board will consider applications for a preliminary finding of suitability for Jeffrey Soffer and Brett Mufson and a gaming license for Dreamscape, whose President Eric Birnbaum and other executives will seek licensing approval. If recommended, both issues will go before the Nevada Gaming Commision later this month.

The Fontainebleau is a joint development by Koch Real Estate Investments, the real estate investment arm of Koch Industries, and Fontainebleau Development, a hospitality and real estate group founded by chairman and CEO Soffer and led in partnership with Mufson. Bowtie Hospitality, a subsidiary of Fontainebleau Development, is also subject of the hearing listed first on the Board’s agenda.

That hearing doesn’t provide licensing; instead, the group will have to come before the Board for approval for a non-restricted gaming license at a later point. For the individuals, it’s a mechanism that allows the Board to investigate individuals similarly to what they would go through for a non-restricted license, according to Michael Lawton, a senior economic analyst for the Gaming Control Board.

State regulations that went into effect in 2011 allowed that an individual or entity “who has not applied for, does not possess and has not entered into a transaction which would require a license, finding of suitability or Nevada Gaming Commission registration may submit to the jurisdiction of the Gaming Control Board by applying for a preliminary finding of suitability.”

When considering an application for a preliminary finding of suitability, the Board and Commission must determine whether the person making the application is suitable to hold a non-restricted gaming license, Lawton said.

“Additionally, when acting on any application for a preliminary finding of suitability, the GCB may recommend, and the NGC may order the granting, denial, rejection, limitation, conditioning, or restriction of the application,” according to state regulations. “Unless otherwise limited or conditioned or subsequently suspended or revoked by the Nevada Gaming Commission, all preliminary findings of suitability expire two years after issuance, unless administratively extended by the Gaming Control Board chair for additional periods of two years each.”

In June, Fontainebleau Las Vegas named Mark Tricano as president of the resort and Michelle Reda, a 25-year Las Vegas casino-marketing veteran who previously worked at Wynn Resorts, as chief casino marketing officer.

In addition, on Wednesday following the Fontainebleau hearing, the Board will consider the application of New York-based Dreamscape for a non-restricted gaming license application for registration as a holding company. Dreamscape acquired the 2,522-room Rio from Caesars Entertainment for $516.3 million in December 2019.

Caesars has operated the property and will continue to do so until Dreamscape takes over by the end of the year.
In June, Dreamscape announced plans to renovate the property once they take over the operations from Caesars.
The Rio opened in 1990 and Dreamscape said its intent is “to preserve the property’s bones and honor its legacy.”

The property will remain open throughout extensive planned renovations, with the company slated to officially take over and manage operations at the resort in the fourth quarter.