LVCVA in early talks to acquire Las Vegas Monorail Co.

The Las Vegas Convention and Visitors Authority is in early talks to acquire and operate the Las Vegas Monorail.

In a brief report to the LVCVA board of directors Tuesday, President and CEO Steve Hill said the organization is exploring options to acquire the 3.9-mile transit system that currently isn’t operating because of the COVID-19 pandemic.

“We had a light touch on the subject in late January or early February,” Hill said after the meeting. “We sat down and said, ‘Hey, what do you think about this?’ And then the virus hit.”

Hill said his conversations were with Las Vegas Monorail Co. President and CEO Curtis Myles.

Now, with the system dormant, tourism numbers down and no indications of when conventions and meetings would return to the Las Vegas Convention Center, talks have restarted and Hill indicated they could move rapidly.

“It’s early in this conversation, although the conversation could move pretty quickly,” Hill told the board. “The current status of the market being shut down because of the virus has certainly harmed every organization and the Monorail is no exception to that, so this has caused the conversation to move forward at a fast pace.”

Hill called the seven-stop Monorail, which debuted in 1995 as a free two-stop shuttle between Bally’s and MGM Grand and then as the Las Vegas Monorail Co. in 2004, “an important transportation option” for the resort corridor.

System expansion

Representatives of the Las Vegas Monorail Co. late Tuesday acknowledged discussions with the LVCVA.

“Like many other businesses, the system closed March 18 due to the pandemic’s impacts and remains closed, and we are forced to deal with this economic reality,” Monorail spokeswoman Ingrid Reisman said in an email.

“As a result, we are exploring ways to be able to open the system at the appropriate time and aid in the recovery of the tourism economy, while ensuring the future viability of the system,” she said.

In recent years, Monorail company leadership have discussed adding a stop on the system’s line at the under-development MSG Sphere at The Venetian — a stop that would also service the Sands Expo and Convention Center. The company also is hopeful that the line could be extended from its southern terminus at MGM Grand to a station between Mandalay Bay and Luxor. That extension would not only help deliver people to events at Allegiant Stadium, but also connect to the Mandalay Bay Convention Center, effectively linking the city’s three major convention facilities.

Hill said an acquisition of the Monorail would require other approvals for it to happen.

“The conversation includes the (Clark) County, but I think that’s probably the easiest part of this, but it also includes the bondholders,” he said. “Reaching an agreement if we can with bondholders is a part of the process, too. We have to go through that conversation.”

One of the important aspects of an acquisition would be the potential removal of a Monorail non-compete clause agreement that has the potential of slowing development of The Boring Company’s citywide underground transit system, an idea generated by the near-completion of a three-stop people mover servicing the Las Vegas Convention Center.

“As you know, and, as we shared during our last board meeting, there is a non-compete area on the current Monorail system that through a transaction, if that were to happen, that would be eliminated,” Hill told the board.

“That acquisition, if successful, would also allow for other transportation options on the east side of Las Vegas Boulevard,” he said.

Ultimately, the Monorail could generate cash, he said.

The underground people-mover at the Las Vegas Convention Center, known as the Convention Center Loop, is expected to be completed by late September with system tests and safety checks planned through December for the system’s debut at January’s CES convention.

Elon Musk’s Boring Company already has contemplated expanding the system citywide with stops up and down the Strip. Agreements already have been reached for underground links to the Convention Center from Encore Las Vegas and from the under-construction Resorts World Las Vegas project.

Goodman opposes LVCVA role

Authority board members asked no questions about the proposed transaction, but later in the meeting, Las Vegas Mayor Carolyn Goodman, a board member, said she wouldn’t be able to support an acquisition and instead suggested that MGM Resorts International acquire it.

“Over the years since it has been established, it (the Monorail) has been a bottomless pit,” Goodman said in the meeting.

“I’d be absolutely opposed to LVCVA participating in funding it and the reason is because it doesn’t go to the (McCarran International) Airport and it doesn’t go downtown,” she said. “It serves very much MGM properties that were looking at purchasing it to take the Monorail over to Mandalay (Bay) to service Allegiant Stadium. It would be my recommendation after more discussion and research and information to us all that it be a private purchase rather, to MGM.”

Representatives of MGM Resorts International declined comment on Goodman’s statement or the LVCVA’s proposed plan.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson. Las Vegas Sands operates The Sands Expo and Convention Center. The Sphere is a project by Madison Square Garden and Las Vegas Sands Corp.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.