Feb. 15--Polo Towers owner Stephen Cloobeck announced Thursday that he plans to build a $240 million time-share complex across from the Aladdin on Harmon Avenue. 

Construction of the 30-story, 850-unit project, named The Chateau, is slated to begin in 2004, and Cloobeck expects it to be the best time-share property in the world. 

"When it comes to quality of time-share product, we're going to raise the bar again," said Cloobeck, whose Diamond Resorts International owns the 270-unit Jockey Club, a 23-unit complex in Hawaii as well as the 512-unit Polo Tower. 

"We're in the epicenter of what's happening in Las Vegas, and I think The Chateau has the best location, by far, of any time-share project in Las Vegas." 

Construction plans call for The Chateau to be built in four phases, each with more than 200 units and taking 14 months to build. 

Unlike most Strip projects with nine-figure price tags, The Chateau is not slated to have a casino, although a club planned for the project's top floor could include some slot machines. 

Cloobeck's Polo Towers bar has 15 slot machines and a restricted gaming license. 

"We don't want to be in the gaming business," he said. "We're a dormitory for the Strip casinos, and that's just what we want to be." 

Cloobeck didn't shrink from the word "dormitory," a word some megaresort operators use in a derogatory way to refer to properties with hotel rooms whose customers end up spending their gambling, dining, entertainment and shopping budgets at neighboring properties. 

"A dormitory is just what we are," he said. "The word is a badge of honor. We're proud of what we do and who we bring to the Strip. Our owners spend about $1,200 on each visit, and they're spending those dollars up and down the Strip." 

About 85 percent of the time share owners at Polo Towers and the Jockey Club own one-week intervals, with the remaining 15 percent owning intervals extending two weeks or longer. 

The Chateau's average unit price is expected to be about $18,000 for a one-week interval, with the entire 850 units expected to generate almost $800 million in sales by the time all intervals are sold. 

Cloobeck acknowledged that the limited resale market for time share units is a key weakness of the business. 

"The big players in the industry are working on a solution to the resale problem, but we're not quite there yet," he said. "We don't try and hide that time-share ownership is a depreciating asset." 

Buyers of time-share units at Cloobeck's existing properties own the interval forever, but are responsible for annual maintenance fees of about $500 for each week they own. 

Buyers hoping to sell their already-purchased units face competition not just from other resellers, but from Cloobeck's company itself. 

"What hurts the resale market is the availability of new product, new units at the same time." 

Polo Towers owners average about $85,000 in annual income. 

Cloobeck said financing The Chateau won't be a problem. 

"Only 10 years ago we had to go out seeking money to build time shares," he said. "Now they come to see us." 

The economic recession and a Strip business slowdown after the terrorist attacks of Sept. 11 haven't hurt sales at Cloobeck's most recently finished project, The Villas at Polo Towers. 

"We've grown revenues during the current recession," he said. "We sold more units (in 2001 than in 2000) and we've kept costs constant." 

Single-bedroom Chateau units are slated to average about 900 square feet, almost twice the size of standard Strip hotel rooms. 

"Our owners are visiting for one week at a time, and a one-week residence is going to look a lot different from a two- or three-day residence," he said. 

The Chateau project is planned for a site Diamond Resorts owns north of an existing Polo Towers structure on Harmon Avenue, east of the Harley-Davidson Cafe. 

The building will have an X-shaped design, copying a popular megaresort design feature that surrounds a central elevator core with four tower wings. 

"The design is the most efficient way to deliver guests to their rooms," he said. "No room is that far from the elevators." 

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(c) 2002, Las Vegas Review-Journal. Distributed by Knight Ridder/Tribune Business News. HDI,