October 2009

Three of Nevada’s leading businessmen, Gregory Garman, Managing Partner of Gordon Silver, Michael V. Shustek, Founder, Vestin Group, and William Wells, Managing Partner of RSM McGladery, will participate in Nevada Economic Summit on October 23, 2009 at McCormick & Schmick’s (Las Vegas). The meeting will begin at 11:30 AM and will be hosted by the CEO-CFO Group.

These three leaders of Nevada’s legal, lending and accounting communities will be on a panel that will respond to questions on the Nevada economy: Where it is and where it’s going.

Greg Garman’s practice is concentrated in commercial and corporate bankruptcy and restructuring. He regularly represents debtors, trustees, official committees, secured creditors and other parties in matters involving hospitality, lending, high tech, gaming, airlines and real estate among others. 

Mike Shustek is the Founder, Chairman and President of Vestin Group, Vestin Realty Mortgage I (Nasdaq: VRTA) and Vestin Realty Mortgage II (Nasdaq: VRTB), as well as the REITs’ Manager.

Bill Wells is the Executive Managing Director of the Las Vegas and Phoenix offices for the firm of McGladrey & Pullen, LLP and RSM McGladrey overseeing 15 partners and 215 personnel.  He joined McGladrey in 1979, was promoted to partner in 1988 and became executive managing partner in 1990.  He is responsible for the strategy and profitable growth of the portfolio of client services, including tax, accounting, consulting, wealth management and retirement resources.

For further information, contact John Laub (jlaub @ regenmd.com).

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Nevada’s jobless rate, at a seasonally adjusted 13.3 percent, was up from the 13.2 percent for August, according to the Bureau of Labor Statistics. Nevada employers added 11,000 jobs in September from the previous month. The month-over-month increase in the unemployment rate was the smallest since March 2008, while the employment gain was the strongest since February 2007.

While Nevada had the third largest month-to-month increase in employment, it remains second in the nation for the highest year-to-year decrease in employment, down 6.1 percent, tied with Oregon and behind Arizona and Michigan.

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MGM MIRAGE (NYSE: MGM – News) announced today that it expects to record a pre-tax non-cash impairment charge of approximately $955 million related to its investment in CityCenter; such charge will be reflected in the Company’s statement of operations for the third quarter. In addition, CityCenter, the Company’s 50/50 joint venture with Infinity World Development Corp, is expected to recognize a $348 million non-cash impairment charge related to its residential real estate under development. MGM MIRAGE will recognize 50 [ercemt of such impairment charge, adjusted by certain basis differences, as a part of its income (loss) from unconsolidated affiliates for the third quarter of 2009. The net pre-tax impact of the CityCenter residential charge to the Company’s third quarter operating results is expected to be approximately $200 million.

MGM MIRAGE evaluates its joint venture investments for impairment whenever events or changes in circumstances indicate that the carrying value of its investment may have experienced an other-than-temporary decline in value. Based on revised operating forecasts developed by CityCenter late in the third quarter, MGM MIRAGE has now determined that the carrying value of the Company’s 50% investment is greater than its fair value and an impairment is indicated. The Company, based in part on consultations with third party valuation specialists, estimates the fair value of its 50% investment to be approximately $2.44 billion as of September 30, 2009.

CityCenter was required to review its residential inventory under development for impairment as of September 30, 2009, mainly due to CityCenter’s September 2009 decision to discount the prices of its residential inventory by 30 percent. This decision and related market conditions led to the conclusion that the carrying value of the residential inventory is not recoverable.

Tracinda Corp, the investment vehicle of billionaire Kirk Kerkorian, said today that it is exploring the possibility of strategic partnerships or other options regarding its investment in casino operator MGM Mirage

“Tracinda believes there is substantial unrecognized value in MGM Mirage and CityCenter that is not reflected in the market value of MGM Mirage’s stock,” the corporation said in a statement.

The company said it would not engage in any transaction until after CityCenter, the 67-acre complex of casinos, hotels and condominiums being built on the Las Vegas Strip, has opened on Dec. 16. The statement added that Tracinda may opt not to pursue any action.

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The Labor Department reported today that U.S. producer prices dropped an unexpected 0.6 percent in September, mainly because of a 2.4 percent decline in energy prices. Prices paid at the farm and factory gate also fell 4.8 percent on the year, which was steeper than forecasts of a 4.2 percent drop.Excluding food and energy, prices declined by a much slimmer 0.1 percent in September.

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Construction of new homes edged up slightly in September, helped by a rebound in single-family construction. However, in a worrisome sign for future housing work, applications for building permits fell by the largest amount in five months.

The Commerce Department reported that construction of new homes and apartments rose 0.5 percent in September to a seasonally adjusted annual rate of 590,000 units.

New applications for building permits, considered a good sign of future activity, fell by 1.2 percent in September, the biggest decline since a 2.5 percent drop last April. Read the rest of this entry »

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