Feb 08, 2010


Hotel Check-In has learned that the Ritz-Carlton Lake Las Vegas in Henderson, Nev., will close its doors for good on May 2, 2010,  which will put around 400 employees out of work.

The 348-room resort - 17 miles away from the Vegas strip - is owned by Village Hospitality, an arm of Deutsche Bank.

"They have decided to cease funding the hotel," says Ritz-Carlton spokeswoman Vivian Deuschl. "We reluctantly agreed to close the hotel."

She could not say how much money the resort is losing.

What this means for the luxury hotel chain, which along with other well-known luxury chains have suffered disproportionately from the recession and corporate travel cutbacks, is not yet clear.  Asked whether the Ritz-Carlton chain - a unit of Marriott International - is considering shuttering more of its hotels or resorts, Deuschl said no, "not that I'm aware."

"For Ritz Carlton itself, it's an indication of the impact of the economic decline, particularly in resort areas like Las Vegas," Deuschl said.

As for the resort's roughly 400 employees, she said that "we are making every effort to place them in jobs at other Ritz-Carltons, Marriotts or other hotels in the Las Vegas area."

Could the USA's hospitality industry see more luxury hotels or resorts close, as the owners of other financially troubled properties look to cut their losses?

"I don't think we'll see more upscale hotels and resorts necessarily close," said Charles Quinn, executive vice president of CBRE Hotels in Dallas, which specializes in hospitality investments. "Depending on how far 'under water' the properties are, lenders may choose to operate them until the market improves."

Analysts expect an uptick in hotel demand later this year, but some hotel owners may also decide that the rebound has come too late.

"These bankers are saying it's not coming soon enough for us . . . The question is will other banks feel the same way," said Jan Freitag, vice president of global development for industry tracker Smith Travel Research.