Skyvue’s future looks cloudy

Both the development and the Jackalope are mythical creatures.

Skyvue appears to be out of money and is fast becoming an eyesore across from Mandalay Bay.

The project, envisioned as a 500-foot-tall wheel with 140,000 square-feet of retail, dining and entertainment, had an estimated cost of $300 million.

But Skyvue so far is nothing more than a pair of 247-foot-tall, unfinished pillars and a concrete foundation.

On Jan. 15, Las Vegas Review-Journal business writer Tim O’Reiley reported companies working on Skyvue, including general contractor Ledcor Construction, filed liens against the project in Clark County District Court for $5.4 million in unpaid bills. By Friday, all contractors, including Ledcor, filed discharges with the county recorder that said they were paid in full.

Developer Howard Bulloch was reportedly seeking additional financing from a Seattle-based investment company that has already sunk at least $9.5 million into the development.

In an email, Bulloch said Skyvue settled its debt issues and expects to finalize construction financing in the next few months.

But that doesn’t mean Skyvue is full speed ahead.

Just look around at Las Vegas’ unfinished buildings – Fontainebleau, Echelon, Shops at Summerlin, St. Regis Residences at The Venetian-Palazzo, Wyndham Vacation Resorts across from the Rio.

That could be Skyvue’s future.

Skyvue’s location, which once housed the 1950s-era Happi Inn motel, hasn’t been that happy in recent times.

In 2009, Cloud Nine offered riders a chance to float 500 feet above the Strip in a tethered balloon seven stories wide, 11 stories tall, and filled with 210,000 cubic feet of helium. With an expensive ticket for a 10- to 12-minute flight, Cloud Nine sprung a slow leak and lasted roughly a year.

Skyvue’s current competition is the $550 million Linq development on the Strip between the Flamingo and The Quad, across from Caesars Palace. The project’s centerpiece will be the 550-foot-tall High Roller observation wheel.

If cities such as London and Singapore need only one observation wheel, what makes anyone think Las Vegas could support similar developments located less than two miles apart?

Bulloch used New York City as an example. He said a ridership study of the market’s observation decks showed the Empire State Building was the most visited with almost 4 million annual customers. Others, including Top of the Rock at Rockefeller Center, were also successful.

“What this shows us is that spectacular views in iconic and beautiful cities are very much in demand, and Las Vegas will be no different,” Bulloch said in an email. “We will have two wheels offering very different experiences and views.”

Caesars Entertainment Corp. has fully funded The Linq, which includes 300,000 square-feet of retail, dining and entertainment offerings.

In October, Linq announced its first wave of tenants, including a Yard House, a Tilted Kilt, a high-end cupcake bakery from Los Angeles, and a Brooklyn, N.Y.-based restaurant that includes a high-energy bowling center and an entertainment venue. The development is scheduled to open this year.

Skyvue hasn’t announced any tenants for its retail and dining component. Construction has been stalled for at least six months.

However, Bulloch said the project has never stopped and is about to restart in Las Vegas.

Large, custom-made parts of the wheel are under development in Germany and Kingman, Ariz. Components being built overseas are expected to arrive there before the end of March for assembly and shipment to Las Vegas by May or June.

A new construction crane could be in place by June. Two more concrete pours are needed to finish the columns. Yokes for bearing seats for the main wheel axle will be placed as part of the final concrete pour.

All it takes is money.

If previous actions are any indication, Skyvue will time the concrete pour to coincide with early-morning newscasts, creating a live television event.

Whether or not Skyvue is completed, frankly, is up in the air.

Skyvue developers argue they have the superior observation wheel.

The Caesars project is tucked behind Linq and doesn’t offer unobstructed views of the Strip. Skyvue is directly adjacent to Las Vegas Boulevard with clear sightlines to the north.

A Skyvue promotional video shows the completed wheel from the air at night with colorful multimedia advertisements lighting up the Strip skyline.

But without money to complete the project, all you have are pretty pictures.

Last month, The Linq hired a general manager for the High Roller whose experience includes 26 years working on attractions for the Walt Disney Co. in Florida and California.

Caesars’ best argument for the Linq’s success is its location at the heart of the Strip. A 2009 traffic study paid for by the company found that 20.4 million people pass by the space over a year. The Linq’s general manager said increased visitation has pushed pedestrian traffic to 25 million people.

Las Vegas needs two observation wheels like it needs two CityCenters.

The betting action is heavily favored on the High Roller.

Skyvue faces long odds.

Howard Stutz’s Inside Gaming column appears Sundays. He can be reached at hstutz@reviewjournal.com or 702-477-3871. He blogs at lvrj.com/blogs/stutz. Follow @howardstutz on Twitter.