Proposal for the Xanadu Hotel and Casino (Las Vegas), October 30, 1975

F E S - PAttAOIStH-B TWCAL.SOOM 3UITH.S - g ^XAMADU ATHUW LAMAt SUITE-b 0o' ^ SSIMO! ^ T2AMSVE.C.S5. 5LCHOM <=C.I'-50.0' + - - 1 ^oo rtt-t 10 to so ^to So to Mt*nms ( fWZE 10 STOCY (e,ao AOPITION SHUFfH m. ' f -. < ' "..t. r . . y ( X A t M A M (^^RtDEM L E W E L V "SUMACS- -su f^kri b7777777777777777777^; ^ ! 1 [7/// 17,7/ ^ \ \ \ \ P///7/7////7/ ,7///f Enn&AJct if L7777777'7777777T 77777777L) L7777777 7777773 [77777777777 7777Z) (2-AME TA^ULATICN a 4 LETfe HCSC MAC^ttJ&g-tSA^ B M $ Ui tQn < >U! t < n I m MACitNDA i-IOTEL-CASil^o < z : f1) 2. GENERAL NOTES: A. LEASED [TEWS (NOT INCLUDED ]N GENERAL CONSTRUCTION CONTRACT (N.t.C.): 1. [LLUMtNATED S!GNS, INCLUDING MA]N SIGN PYLON, READER BOARD, DtRECTIONAL tDENTIFtCATION SIGNS, BUILDING FACADE GRAPHICS, ETC. 2. OFFSITE IMPROVEMENTS RELATtNG TO LEASED AREAS. 3. FtXTURES FOR LEASED AREAS FURNISHED BY TENANT. 4. TELEVIStON/RADIO UNITS AND MASTER TV ANTENNA SYSTEM. 5. ROOM STATUS SYSTEM (CONDUIT BY G.C.) 6. VENDING MACHtNES FOR EACH ROOM FLOOR (cONNECTtONS BY G.C.) 8. ITEMS [NCLUDED !N GENERAL CONSTRUCTION CONTRACT: ALL CONSTRUCTtON SHOWN ON THESE DRAWINGS AND AREA TABULATING tNCLUDtNG: 1. STAGE EQUIPMENT, [NCLUDtNG LIGHTING, SOUND, R[GG[NG, HFTS, RAIN CURTAtN, ETC. (ALLOWANCE TO BE ESTABHSHED FOR THEATRE AND LOUNGE AREA). SOUND AND PUBHC ADDRESS SYSTEM FOR ENT]RE PROJECT, [NCLUDtNG CONVENTION AND MEETING FACIHTtES; H F E SAFETY SYSTEM PER UBC IS AND LOCAL CODES, [NCLUDtNG F[RE PROTECT[ON, SPRINKLERS, ANNUNCIATORS, SMOKE DETECTORS, EXHAUST SYSTEM (]NCLUD]N6 ATRIUM), EMERGENCY ELECTRICAL SYSTEM (DtESEL GENERATORS), [NCLUDtNG EGRESS L[GHT]NG, PRODUCT REFRtGERATtON EOUtPMENT, SOX CAStNO UGHTtNG, CASHtERS CAGE LIGHTING, SLOT MACHtNES, ETC., CONDUtT FOR ROOM STATUS SYSTEM; DtMMERS FOR CONVENTION CENTER (FOR INCANDESCENT LtGHTING BEtNG 1/3RD OF TOTAL PROVIDED), MEETING AND CONFERENCE ROOMS (WALL MOUNTED DtMMERS), AND DIMMERS FOR ALL LOUNGES AND SPECIALTY RESTAURANTS, EXCEPT COFFEE SHOP. REVOLVING BAR AND MUStC CONTROLLED WATER FOUNTAINS ("DANCING WATERS*), REFLECTING PONDS, "MYSTICAL GARDEN*, SPECIAL LIGHTING EFFECTS), ETC. ON "XANADU (ATRIUM) LEVEL*. ALL StTE DEVELOPMENT (ON-SITE) [NCLUDtNG CURBS, PAVtNG, STRtP-ING, PLANT]NG AND GENERAL LANDSCAPING, ENTRY FOUNTAtNS AND "FIRE-FALLS*, LANDSCAPING OF ALL DECKS, AND LANDSCAPED AREAS OF CONSTRUCTION. ALL EXTERIOR LIGHTtNG OF BUILDtNG, PORTE COCHERE, PARKING AREAS, ETC. VtNYL WALL FABRICS TO BE FURNISHED BY [NTERIOR DEStGNER. INSTALLATtON IN ALL ROOMS AND PUBLtC BY G.C. MILLWORK, PLASTIC DESIGNS AND DECORATIVE CONSTRUCTION FEATURES. LINEN AND TRASH CHUTES. ROUGH-IN, STUB-OUT, AND CONNECT ALL UTILITIES FOR LEASED AREAS, IN SHELL, TO BE PROVIDED FOR TENANT tMPROVEMENTS. FOLDING.AND SLtDING WALLS, ELECTRONICALLY OPERATED, PLASTtC LAMtNATE FINtSH. 6. 7. M. 11. EXPENSE OF ALL REPRODUCTION OF CONSTRUCTtON DOCUMENTS, FOR CONSTRUCTION, FROM TRANSPARENCY AND MASTERS FURNISHED BY THE OWNER. C. FtXTURES, FURNISHtNES, AND EQUIPMENT (F.F. A E.) (EXCLUDED FROM GENERAL CONSTRUCTION CONTRACT) 1. FOOD AND BEVERAGE SERVtCE EOUtPMENT, (ALL HOODS, BARS, REFRtGE-RATtON EOUtPMENT, ETC.), AND TRASH COMPACTOR. 2. FURNITURE, FURNtSHINGS, DECOR, CURTAtNS, STAGE DRAPERIES, CARPETING, FRONT DESK AND ROOM SYSTEM BACKUP, SLOT MACHINES AND BASES, AND GAMtNG EQUIPMENT. 3. DECORATIVE LtGHTtNG FIXTURES. OFFICE EQUIPMENT, SPECIAL COMPUTER ROOM FLOOR, TELEPHONE SYSTEM, AND LOCKER ROOM EQUIPMENT. ITEMS TO BE PAtD DIRECTLY BY OWNER: (NOT A PART OF GENERAL CONSTRUCTION CONTRACT) 1. BUtLDING PERMIT AND SEWER CONNECTtON FEES. 2. REPRODUCTtON OF CONSTRUCTION DOCUMENTS USED FOR INFORMATION AND BIDDING PURPOSES, BUT NOT THOSE TO BE USED FOR CONSTRUCTtON. H . AREA IABIILAHON A PUBLIC, ENTERTAINMENT, RECREATION, SERVICE, AND STORAGE FACILITIES: FIRST FLOOR (CAStNO, CONVENTION AND RELATED FACILITIES) SECOND FLOOR (ADMINISTRATION AND SERVICE) * THIRD FLOOR (XANADU GARDEN AND ATRIUM AND LANAI ROOMS, DOES NOT INCLUDE 30,000 SO.FT. OPEN TO CAStNO) THIRD FLOOR EXTERtOR DECK: OPEN AREA ([NCLUD1N6 POOLS) * ENCLOSED AREAS 3S3,000 SQ.FT. 100,000 SQ.FT. 120,000 SQ.FT. 328,000 SQ.FT. 113,700 SQ.FT. *h.A" PUBLtC AND SERVtCE AREAS 1,015,700 SQ.FT. B. ROOMS TOWER: (TOTAL OF 1830 ROOM MODULES) = 1,100,000 SB.FT. 1730 UNITS LOCATED IN 22 NON-TYPICAL FLOORS, INCLUDING ELEVATOR CORES, SERVICE AREAS, STAIRS, ATRIUM CORRIDORS, ETC. (BUT EXCLUDING AREA OF LANAt SUITES ON THtRD FLOOR). EXTERtOR BALCONIES = 150,000 SQ.FT. INTER[OR CORRIDORS X ELEVATOR CORE 150,000 SQ.FT. C. SECOND FLOOR FACILtTIES TOTALING 100,000 SQ.FT. WILL INCLUDE THE FOLLOWING AREAS: 1. HELPS LOCKER ROOMS 2. UNIFORM tSSUE 3. HOUSEKEEPERS OFFtCE 4 STORAGE 4. CLEAN AND SOILED LINEN ROOMS 5. ADMtNISTRATtONOFFtCES 6. VALET 7. VALUABLES 8. THEATRE 4 LOUNGE, DRESSING ROOMS, ETC. 9. TRASH ROOM 11. MtSC. MECHANICAL EQUIPMENT ROOMS NOTE: BALANCE OF AREA TO BE ASSIGNED FOR DEPARTMENT USES. PARKING DECK VALET PARKING (SUBTERRANEAN BELOW CASINO) PARKING DECK STRUCTURE: 1. THREE LEVELS AT 187,000 SQ.FT. 2. 3. ONE LEVEL AT GRADE RAMPS OUTSIDE OF PARKING STRUCTURE 180,000 SQ.FT. 561,000 sa.FT. 187,000 SQ.FT. 13,000 SQ.FT. TOTAL "]].B* PARKING STRUCTURE AREA 761,000 SQ.FT. 1H. PARK1HG A. PARKING PROVIDED: 1. VALET PARKING 2. SURFACE 3. FOUR PARKING DECK LEVELS AT 500 PER LEVEL 500 CARS 1,000 CARS 2,000 CARS TOTAL *[[t.B*: PARKING PROVtDED 3,500 CARS !V. GAUNGTABIILATtO'l 1. SLOTS * 800 2. *21* GAMES - 52 3. CRAP TABLES * 8 '1. ROULETTE - 4 5. KENO - 1 S. BtG'K" - 2 7. BACCARAT * 3 8. MlNt-BACCARAT - 2 9. POKER TABLES - 20 10. SPORTS/RACE BOOK - 1 setHiEMtLtE <S)F D R A SK 1. SK 2. SK 3. SK 4. SK 5. SK 6. SK 7. SK 8. GR0UNB FLOOR XANADU HOTEL AND CASINO LAS VEGAS, NEVADA OWNER: XANADU CORPORATION ARCHITECT: MARTIN STERN JR, A.I.A. ARCHITECT AND ASSOCIATES BATE: OCTOBER 3 1 , 1975 October 30, 1975 XANADU HOTEL AND CASINO TABLE OF CONTENTS 1. Introduction 2. The Xanadu Theme (5 pages) 3. Concept For Information Card. 4. Aerial Photograph of Site. 5. Site Plan. 6. Photographs of Architect's Preliminary Design Model. 16 Plates. 7. Resume for Proposed Hotel Executive. 8. Appraisal Report (copy: October 30, 1975). ( October 30, 1975 XANADU HOTEL AND CASINO INTRODUCTION TO PRESENTATION The documentation contained herein, dated October 30, 1975, pertains to the "revised and expanded" Xanadu Project of approximately 1730 rooms, and is to be considered as super-ceeding like documentation for the "previous" Xanadu Project, proposed as approximately 1100 rooms. This presentation includes the MAI "Appraisal Report", pre-pared by Gary H. Kent, Inc., and "Preliminary Schematic Design Drawings", dated October 30, 1975, prepared by the Architect, Martin Stem Jr. A.I.A. Architect & Associates, consisting of eight sheets. * * * * * * ( October 30, 1975 Page 1 of 5 XANADU HOTEL AND CASINO - "THE XANADU THEME" The Xanadu is proposed as a 1730 Room "International Class" Hotel and Casino, to be located "On the Strip" in Las Vegas, Nevada. Approaching the overwhelming Porte Cochere, attention is immediately focused upon the "Firefalls", cascading waters which nearly stretch across the site, penetrated by the red-orange licks of dancing flames. Upon entering the Xanadu, the soaring atrium some twenty stories in height, capped by the shimmering essence of mirror and crystal above, and down to the action and animation of the Casino below, dominates, and envelopes the viewer. A lush garden fantasy of pergolas and gazebos located on the atrium deck, overlooks the Casino, setting the tone for the Xanadu theme. On the way to the Restaurant Core, one would stroll through the Shopping area which would be developed as a "Bazaar", comprised of small shops and boutiques in tents, islands or kiosks, all inviting browsing, and featuring activities such as artists and artisans creating the goods for sale. Specialty restaurants such as a "Mongolian Barbecue " (steak house); "The Marco Polo" (conr-tinentalspecialties); "The Flaming Sword" (flambe specialties); "Forbidden City" (oriental cuisine), along with a Seafood Specialty Restaurant,(will be complete with a giant aquarium-wall),complimented by a variety of cocktail lounges and bars located within the "Garden of Xanadu" and Casino Areas. Themes and moods such as "Samarkand", "Shalimar", "Cashmere", "Shangri-La" are envisioned, with a special intimacy, utilizing such elements as magnificent guilded desert tents, soft cushions and exotically costumed waitresses. Page 2 of 5 A Theatre Showroom, with a thrust stage for greater viewing and audience involvement will seat approximately 1,500 persons with ease. The Lounge adjoins a new multi-purpose concept discotheque, which not only serves as a late hours "center of action", but as a Buffet and Cinema as well. The Convention Center will seat in excess of 3,000 people for a banquet, in addition to exhibit space in the Reception Hall. As part of this complex, Meeting Rooms of various sizes and potentials will also be provided. These and all other areas and aspects of the Hotel and Casino, while meeting all the-highest* standards^and-functional..requirements of this most modern and complete facility, shall be carried out in a theme of the imaginative, and make-believe dream world of XANADU. An historical background and the poem "Kubla Khan" reprinted from a treatise on English Poetry follows: Page 3 of 5 "KUBLA KHAN: OR, A VISION IN A DREAM" The following fragment is here published at the request of a poet of great and deserved celebrity (Lord Byron), and, as far as the Author's own opinions are concerned, rather as a psychological curiosity, than on the ground of any supposed poetic merits. In the summer of the year 1797, the Author, then in ill health, had. retired to a lonely farm-house between Porlock and Linton, on the Exmoor confines of Somerset and Devonshire. In consequence of a slight indisposition, an anodyne had been prescribed, from the effects of which he fell asleep in his chair at the moment that he was reading the following sentence, or words of the same substance, in 'Purchas's Pilgrimage': 'Here the Khan Kubla commanded a palace to be built, and a stately garden thereunto. And thus ten miles of fertile ground were inclosed with a wall.' The Author continued for about three hours in a profound sleep, at least of the external senses, during which time he has the most vivid confidence, that he could not have composed less than from two to three hundred lines; if that indeed can be called composition in which all the images rose up before him as things, with a parallel production of the correspondent expressions, without any sensation or consciousness of effort. On awakening he appeared to himself to have a distinct recollection of the whole, and taking his pen, ink and paper, instantly and eagerly wrote down the lines that are here preserved. At this moment he was unfortunately called out by a person on business from Porlock, and detained by him above an hour, and on his return to his room, found, to his no small surprise and mortification, that though he still retained some vague and dim recollection of the general purport of the vision, yet, with the exception of some eight or ten scattered lines and images, all the rest had passed away like the images on the surface of a stream into which a stone has been cast, but, alast without the after restoration of the latter! Page 4 of 5 Then all the cAarm Ts JbroJcen-aJJ that phantom-world so fair Vanishes, and a thousand circlets spread, And each mis-s^apefTsJ the otAer. Stay aurAiJe, Poor youth! who scarcely dar'st lift up thine eyes- The stream will soon renew its smoothness, soon The visions will return! And lo, he says, And soon the fragments dim of lovely forms Come trembling* bacJc, unite, and now once more The pool becomes a mirror. ('From the Picture; or the Lover's Resolution^ Yet from the still surviving recollections in his mind, the Author has frequently purposed to finish for himself what had been originally, as it were, given to him, but the to-morrow is yet to come. As a contrast to this vision, I have annexed a fragment of a very different character, describing with equal fidelity the dream of pain and disease. KUBLA XRAN In Xanaxu did Xuhla Xhan A stately pleasure-dome decree; Where Alph, the sacred river,ran Through caverns measureless to man Down to a sunless sea. So twice five miles of fertile ground With walls and towers were girdled round? And there were gardens bright with sinuous rills, Where blossomed many an incense-bearing tree; And'here were forests ancient as the hills, Enfolding sunny spots of greenery. But oh! that deep romantic chasm which slanted Down the green hill athwart a c e d a m cover! A savage place! as holy and echanted As e'er beneath a waning moon was haunted By woman wailing for her demon-lover! Page 5 of 5 'And from tAis chasm, witA ceaseless turmoil seething, As if this earth in fast thick pants were breathing-, A mighty fountain momently was forced: Amid whose swift half-intermitted hurst Buye fragments vaulted like rebounding hail, Or chaffy yrain heneath the thresher's flail; And 'mid these dancing rocks at once and ever It fluny up momently the sacred river. Five miles meandering with a mazy motion Through wood and dale the sacred river ran, Then reached the caverns measureless to man, And sank in tumult to a lifeless ocean; And 'mid this tumult Ifuhla heard from far Ancestral voices prophesying war! The shadow of the dome of pleasure floated midway on the waves/ Where was heard the mingled measure From the fountain and the caves. Tt was a miracle of rare device, A sunny pleasure-dome with caves of ice! A damsel with a dulcimer In a vision once I saw; Tt was an Ahyssinian maid, And on her dulcimer she played, Singing of Mount Ahora, Could T revive within me Ber symphony and song, To such a deep delight 'twould win me, That with music loud and long, T would huild that dome in air, That sunny dome! those caves of ice! And all who heard should see them there, And ail should cry, Beware! Beware! Bis flashing eyes, his floating hair! Weave a circle round him thrice, And close your eyes with holy dread, For he on honey-dew hath fed, And drunk the milk of Paradise." October 30! 1975 XANADU HOTEL AND CASINO CONCEPT FOR "INFORMATION CARD" TO BE PLACED IN ALL GUEST ROOMS, PUBLIC AREAS, ETC. To explain the origin of the name XANADU and how this is carried through into the Architectural Theme. "IW XANADU did KuJbia Khan a stately pieasure-dome decree...." These words were written near the end of the 18th century by the poet Samuel Taylor Coleridge. In Coleridge's mind XANADU was a "dream place", conjured by the benevolent con-queror of China, Kubla Khan. It was Kubla's "Garden of Delight", and in the midst thereof he created a "sumptuous house of pleasure " We offer you XANADU today, in the hope it will fulfill all of your dreams of pleasure and delight here with us in Las Vegas. MofMM MARINA XAMADU H<yr&- rjHtue iBMsa M/^eiSNDA HOTEL CA^i^o y October 30, 1975 Page 1 of 2 XANADU HOTEL AND CASINO RESUME: BURTON M. COHEN Under consideration as President and a Director of the Xanadu Hotel and Casino. The following is a reprint of a resume submitted by Mr. Cohen. Consideration of Mr. Cohen is to be treated confidentially. Present Position: President, Thunderbird Hotel, from February 5, 1973, to date. Also serves on the Board of Directors of Caesars Palace. Mr. Cohen came to Las Vegas in October, 1966, as the Managing Director of the Frontier Hotel, where his res-ponsibility was the supervising of the building of the hotel, from the ground up, and staffing it. He,later, served as Administrative Director of the Desert Inn Hotel and Managing Director of Circus Circus. At Circus Circus, he was responsible for all phases of staffing and development of the project. In July 1969, he joined the Flamingo Hotel as Executive Vice President until January 1, 1971, when he became President, serving in that capacity until February 5, 1973, when he joined Caesars World to take over the development of the Mark Anthony project at the Thunderbird Hotel." Mr. Cohen was bom in Philadelphia, Pennsylvania, and prior to moving to the West Coast, was a native of Miami, Florida. He graduated with a law degree from the University of Miami and from 1948 to 1964 was a prominent practicing attorney. He still maintains office association for the practice of law in Miami. He was one of the founders and legal counsel for the International Airport Hotel Systems, Inc., a public company. In 1964, the home office moved to Los Angeles. Mr. Cohen assumed the position of Managing Director of the International Hotel-in Log Angeles, as well as becoming President of the Company. Cohen has held many important community and industry positions. He served as Deputy Commissioner of the Florida Industrial Commission and was a member of the Los Angeles Convention Bureau Board of Directors and the U.S. Department of Commerce Travel Advisory Committee. He was also Director of the RESUME: BURTON M. COHEN Page 2 of 2 ( Southern California Hotel and Motel Association. He is a member of the American Bar Association, the Florida Bar Association and the Dade County Bar Association. He is also one of the ten board members of the Las Vegas Conven-tion/ Visitors Authority. Active in local charities, he was secretary of the United Fund of Clark County and served on the Board of Directors of the Nevada Division of American Cancer Society. He is a past President of Bluecoats, Inc., and is a member of the Board of Directors of the Boys' Club of Clark County. "" * * * * * * ( ( APPRAISAL AND FEASIBILITY STUDY of the Proposed Xanadu Hotel/Casino Complex TO BE OWNED by Xanadu Corporation LOCATED at the Southwest corner of Tropicana Avenue and Las Vegas Boulevard South Clark County, Nevada LEGALLY DESCRIBED as a Portion N^, NE^, Section 29, Township 21 South, Range 61 East, M.D.B. for the purpose of ESTIMATING MARKET VALUE and the FEASIBILITY OF THE PROJECT Revised as of October 30, 1975 GARY H. KENT,INC. GARY H. KENT. PRES)DENT& IWAtA SRPA Gar^/H. Kent, MAI, SRPA GHK/pjs E A R Y H K E N T , I N C . GARY H. KENT,PRES!DENTAMA!A$RPA 2915 W. CHARLESTON BOULEVARD LAS VEGAS, NEVADA 89102 Phone (702) 870-0373 Data setting forth the analysis used and descriptive details are included in the body of this report. Analysis, correlation and conclusions of all data utilized results in the estimate that the fair market value of the subject property, in fee, subject to normal financing, as of October 30, 1975 is: Xanadu Corporati c/o Martin Stern Architect and Ass 9348 Santa Monica Beverly Hills, Gentlemen: Enclosed is the updated feasibility and appraisal report on the proposed Xanandu Hotel and Casino, a 1,730 room complex with convention facilities, restaurants, bars, and casino areas. This updated report* is submitted by reason of moving the location of the proposed project and expanding the project from its initially proposed 1,092 rooms. The hotel is to be owned by Xanadu Corporation and is to be located at the southwest corner of Tropicana Avenue and Las Vegas Boulevard South, more particularly described as Assessor's Parcel No. 14-63-7 and 8. ONE HUNDRED FORTY -FOUR MILLION DOLLARS ($144,000,000.00) Thank you for the opportunity of conducting this feasibility study and appraisal report for you. Sincerely, /// It is our finding that venture if constructed. would be a highly feasible October 30, 1975 TABLE OF CONTENTS ^Title Page i ^Latter of Transmittal ii Table of Contents iii Summapy of Salient Facts and Important Conclusions Purpose of Appraisal 2 Market^alue Defined 2 Highest,and Best Use Defined 2 Effectiverpate of Valuation 2 Method of"Va.luation 2 Area and City* Map 3 Area and City^Data *4 Neighborhood Map 9 Neighborhood Photographs 10 Neighborhood Description 12 The Las Vegas "Strip" Tourist Industry . . . 14 Subject Photographs.*, 46 Description of Subjects Property Site M 51 Improvements. . . .'--.'x- 53 Comparable Land Sales Mag^ 54 Comparable Land Sales Chart\ 55 Comparable Land Sales Abstracts 56 Correlation and Conclusions'to Land Value Estimate . . . 63 Summary to Land Value Estimate^. 66 Cost Approach to Value . . . ^ 67 Summary to Cost Approach to Value\ 69 Income Approach to Value . . . 70 Summary to Income Approach to Value^ 81 Correlation and Conclusions to Valuation Estimates . . . 84 ADDENDA: Limiting Conditions Appraiser's Certification ^^ Appraiser's Qualifications H-l Zoning Specifications ^ Reduced Plans of the Proposed Subject Proj-e3=t. t 1 GARY H. KENT,INC. GARY H. KENT. PRES)DENT& IWAtA SRPA - 1 - Revised 10-30- SUMMARY OF SALIENT FACTS AND IMPORTANT CONCLUSIONS ^t-.PROPERTY LOCATION: Southwest corner of Las Vegas Boulevard South and Tropicana Avenue, Clark County, Nevada PROPOSED OWNERS: Xanadu Corporation HIGHEST/AND BEST USE: HoteT/.casino project with related facilities. LAND SIZE\/ 2,117,88^$ sq. ft. PROPOSED IMPROVEMENTS: A 1,730 room hotel with 980,000 sq. ft. of public area and a 761,000<^q. ft. parking deck. DATE OF VALUATION ESTIMATE: October 30, 1975^ ^ VALUE INDICATED BY: Cost Approach $149 ,200 ,000.00 Income Approach $144,000,000.00 ESTIMATED MARKET VALUE OF PREFECT: When completed and in ope^at^on including furnishings and equipment $144 ,000 ,000. 00 % t GARY H. KENT,INC. GARY H. KENT. PRES)DENT& IWAtA SRPA [G i[j i ! G ! ! iu i n : i -2- PURPOSE OF APPRAISAL ^ To estimate the market value of the subject property on a going concern basis and as if in complete operation, held fee simple ownership, assumed free and clear of all -Hens and encumbrances, except for normal mortgage financing. TKe^function of this report is for the acquisition of mortgage financing. MARKET VALUE DEFINED As defined by the courts. . . ."The hiyhest price estimated in terms of money which a property will briny if exposed for sale in the open market, aiiowingr a reason^i^e time to find a purchaser who buys with Anoviedgre of aii the uses to which it is capable of being* used." n ^ HIGHEST AMD BEST USE DEFINED Highest and best use may-^be defined as.... "That ieyai use which wiii produce the greatest neh^.petum to land over a given period of time." EFFECTIVE DATE OF VALUATION i October 27, 19 7 5 METHLOaDn d OFv alVuAeLsU AwTeIrOeN estimated by Direct Matket Comparison to recent sales of similar land parcels in the, general area.. Improvement values for the Cost Approach weY% ^estimated by Taylor of Nevada and reference to Marshall Valuation Service. By reason of the complexity of the hotel/casin^market and the great degree of variance in ratios of casino^area to the number of rooms, the Direct Sales Comparison Approach to improved partels having similarity to the subject Wefa not applied in valuation. ^ The Income Approach, analyzing capitalized net income dc3hnomic to the subject property to an indication of value was useri^. GARY H. KENT, INC. GARY H. KENT. PHESiDENT- MAI^ SRPA AREA AND CITY MAP I t GARY H. KENT,INC. GARY H. KENT. PRES)OENTAMA)ASRPA Sat/ AREA AND CITY DATA GENERAL INFORMATION: Th^-population of the area is concentrated in the Greater Lay/Vegas Valley, which is in the central portion of the County-. The valley contains approximately 480 square miles of near? level to gently undulating terrain and is approx-imately ^ O i e feet above sea level. The climate of the valley is semi-arid with 3.9 inches of annual rainfall, an average temperature of 65.8°, with the average temperature of the hottest month, July, being 89.7° and the average temperature of the coldest month, January, being 43.1°. A Las Vegas was incorporated in 1911 with a small population. It was not until^'the Hoover Dam project was started and inexpensive powers and land began attracting industry that Las Vegas started tp^grow. It was near this time that the resort industry also^began. ECONOMIC BASE: The economic base of the'Las Vegas area consists of tourist industry, service industry^military bases, Nevada Test Site, governmental and municipal"agencies, and mining and manu-facturing. The heaviest emphasis is on the tourist industry. Within the tourist industry dre approximately 290 motels and 33 major hotels with a total room inventory of approximately 33,351 first class rooms, as off^hrch, 1975. In addition, there are approximately 1,748 hotel/motel rooms currently under construction. Since the majority of these accommodations are of the overnight type, their numb&r demonstrates the size of the local tourist industry. This is further demonstrated by the estimated touristSat^endance to the Greater Las Vegas area. In 1974, the estimated visitor attendance was 8,664,751 as compared to &^4J4,727 in 1973. During 1974, total tourist spending was $1^531,089,307.00, as compared to $658,397,805.00 in 1969 for a&\increase of 87%. Gaming revenue over the same period of\&ime increased approximately 102% from $338 ,339 ,052.00 to $684,,067,282.00. A significant portion of the major industrial bas€?of Clark County is located at Henderson, Nevada, and consists of the Stauffer Chemical, American Potash and Chemical, Fli^tkote, Titanium Metals of America and Kerr-McGee Chemical Corporation. FFl n * ST VT-MfW TUTf -15- Federal Government supported and military establishments include the Energy Research and Development Administration (ERDA), Nevada (Nuclear) Test Site, Indian Springs Air Force Base and Nellis .Air Force Base. (_The labor force of Clark County for 1974 was 154,300 people ?%ilth an unemployment rate of 9.7% as compared to a labor fprce in 1970 of 130,100 with a 5.9% unemployment rate. Thi§, reflects a 19% increase in the labor force from 197 0 through 1974. Total payroll in 1974 was $1,091,631,551.00 as compared to a payroll in 1969 of $654,534,810.00 or an increase of 67%. The largest contributor to the labor force was the^gervice industry (hotels and service) providing 47% of the employed labor force with jobs and 47% of the payroll. The trade .industry supplied 20% of the labor force and 17% of the payroll/^The balance of employment was divided between transportation, government, construction, manufacturing and mining, fin&icing, real estate, miscellaneous and unemployment. [9F The estimated bank,,debits for the year 1974 was $12 ,581,321,000.00 as compared to 19%) bank debits of $6,7 34,913,000.00 for an increase of 87% morepor less. During 19 74, total construction permits were $200,877,978.00, down from $3 31,9 3 6 ,356^0(1 for 197 3 . The primary reasons for this decrease was lack df_.*^construction financing, labor strikes and unacceptable long-tern&'interest rates. With Las Vegas' rapidly expanding economic\base, it is forecast that this reduction is temporary and w&ll be overcome as inventories are depleted and more acceptel^le financing becomes available. UTILITIES: Water is supplied by the Las Vegas^Valley Water District, electricity by the Nevada Power Company, natural gas by the Southwest Gas Company and the California-Pacific Utilities Company, and sewer is a municipally owned facility with a daily capacity of 30 ,000,000 gallons, ^-T^e service is adequate and dependable and the rates are comparable to or below those in the adjoining western states. POPULATION: The 19 7 0 census indicated Clark County population to be 273,288 persons, an increase of approximately*^E15% over the 19 6 0 census. Of the above number, approximately^20 0,0 00 are estimated to live in the City of Las Vegas and Cla±:k County along the "Strip" and the City of North Las Vegas^Current population estimate is 334,192, an increase of 22% over 1970. GARY H. KENT, INC. GARY H. KENT. PRE9DEKT- MAtA SRPA -6- TRANSPORTATION: Las Vegas has excellent transportation connections with all parts of the nation. It is served by 4 major highways which connect the city with such metropolitan areas as Los Angeles California (289 miles to the west); Phoenix, Arizona (291 miles to the southeast); and Reno, Nevada (448 miles to the northwest). Bias service includes Greyhound, Continental Trailways, LT^ Stage Lines, Sun Valley, Las Vegas Transit, and Transportation Unlimited. Greyhound and Sun Valley bus lines^had 327,465 incoming passengers, 158,794 stop-over passengers and 232,717 outgoing passengers while Las Vegas- Tonopah-Reno Stage Lines, Inc. had 294,054 regular passengers, 187,148* charter passengers and 15,919 local passengers such as Hendersbn and Nellis in the year 1974. There are approximately 16 truck lines. Plane service Is furnished by Air West, Delta, Frontier, National, TWA,^-United and Western. Commuter lines include Apache, Mustang^'CalState, Scenic and TransNevada. The total air passenger movement in 1974 was 5,944,433, an increase of 45% over 1970. AirPservice provides non-stop service to many of the major papulation centers with connections to almost every city in*^the nation. Rail is furnished by the Union Pacific Railroad, which is freight service only. Internally, the City is serves^ by 2 bus lines, over 500 taxis (including limousines and tour vehicles) plus 4 major car rental agencies. ^ SCHOOLS: ^^ There are 67 elementary schools, ISp junior high schools, 4 junior-senior high schools and 9 senior high schools, Southern Nevada Vocational Technical Institute, the Community College and the University of Nevada at^^as Vegas. The 1974 enrollment was estimated at 78,503" students, indicating an increase of 11% over 1970. In addition, the University of Nevada, Las't&gas is staffed by a faculty of 325 instructors and attended .by over 7,000 students. Clark County schools are of an excellent quality with an education level above the national average. COMMUNITY SERVICES: ^ In addition to the hotels and motels described aboveQ there are 8 modern hospitals, 150 churches representing 3S*^(3jenomin-ations, 6 banks, with a total of 46 branch offices, 3 newspapers, 12 radio stations, 5 television stations, 10 championship, golf courses, approximately 4,000 private, semi-private and public swimming pools, and other recreational facilities.^ GARY H. KENT, INC. GARY H. KENT. PHESiDENT- MAI^ SRPA -15- A special facility is the Las Vegas Convention Center, having a seating capacity of 8,500 persons, 40 multi-purpose meeting rooms and 515,000 square feet of exhibition space. In 1972, there were approximately 311,908 people participating in \^3^conventions in Las Vegas. There were 339 separate conventions. RECREATION AREAS: L^S Vegas is located approximately 35 miles southeast of the^Mt. Charleston ski and recreation area, 25 miles northeast of tRja Red Rock summer recreation area and 45 miles northwest of the^Lake Mead recreation area. In addition, there are, within-^driving distance, the Valley of Fire, Zion and Death Valley National Parks. All recreational areas are used on a'year-round basis and offer a variety of State supervised facilities. TAXES: Nevada has no personal income, inheritance, State or gift, or taxes on intangibles. Property taxes are limited by the State Constitution to $5.00 per $100.00 of assessed valuation. The assessed valuation is limited to 35% of the market value. (iXe State sales tax is 3.5%. Nevada's Freeport Law%/which exempts goods in transit and not to be delivered within the state from taxation, has caused a great influx in warehousing in the State of Nevada. GOVERNMENT: The County operates as an independent political entity and is administered by a County Manager who is supervised by a 7-man Board of Commissioners, The City administration consists ofs. a Mayor, 5-man Board of Commissioners, a City Manager an^ appropriate departments. Both the County and City administrations have proven to be effective. ( A SUMMARY: The general Las Vegas area has grown at aa?extremely rapid rate and should continue to do so in the foreseeable future. However, public services have been maintained,at a level to adequately serve the population. Area forecasts indicate that Las Vegas' population could reach 600 ,00*SyMithout experiencing any major problems of furnishing dyility ser