July 6, 2004 - After years of what they consider neglect, the new owners of the Las Vegas Hilton are planning to give the off-Strip resort all the attention they believe it deserves.

"We love having the Hilton. We want to restore its magnificence. There is tremendous potential," Rudy Prieto, Colony Capital's chief executive officer and Las Vegas Hilton general manager, said.

In mid-June, Caesars Entertainment formally announced the sale of the Las Vegas Hilton to Colony Capital for approximately $280 million.

Part of the new focus on the Las Vegas Hilton will involve a $70 million renovation, which will begin with the main casino area in September and eventually will touch every corner of the convention-oriented resort.

The result will be an updated look and an improved ability to move visitors through the property, Prieto said. He blamed much of the hotel-casino's declining performance in recent years on the previous owners' inattention.

Colony executives say the Las Vegas Hilton stands to benefit from having one of the best monorail terminal locations along the entire several miles of the system. The terminal for the monorail, which will debut this month after months of delays, will be just a short stroll from the Hilton's front doors.

Prieto said it is important for the hotel-casino to encourage monorail riders to stay as long as possible in the building. Therefore, improving the property's main entrance is a priority.

Although he wouldn't discuss specifics, Prieto said improvements to the entrance, which was largely ignored in recent years, will probably include new lighting, carpeting and color schemes.

The Hilton also must entice visitors to the property's Star Trek attraction to stay longer in the hotel, Prieto said. Top officials at former Las Vegas Hilton owner Caesars Entertainment and its corporate predecessor Park Place Entertainment Corp. had little interest in exploiting the Star Trek attraction, Prieto added.

Meanwhile, Prieto said Colony also needs to focus on the Las Vegas Hilton's aging inventory of about 1,400 video and reel games.

"Yes, they're outdated," he said. "That's an understatement."

The number of slots will probably be increased, but the timing for such a step has not been determined.

Renovation won't stop at slots, Prieto said.

"We are going all the way back into the sports book with our improvements because we have the desire and we have made the commitment to reposition this facility at the super book," Prieto said. "The size will not change. There are improvements already in the works in terms of new seating and new boards."

Prieto promises the "super book" improvements will be ready for the start of football season in September.

Although the first phase of Colony's renovation plan will focus on casino improvements, Prieto said the second phase will include a new lounge facing the casino floor. The coffee shop also will be expanded with a new entrance closer to the casino. Also, the Mexican restaurant adjacent to the coffee shop will be relocated or eliminated.

"We have plans also for the NightClub that we will soon be announcing," he said. "These will include another name and new entertainment ideas."

Eventually, the hotel-casino may add an "ultralounge," an idea that's succeeded at MGM Grand, The Mirage and Bellagio, he said.

Before then, Colony believes the hotel-casino will get a boost with the addition of an Andre's restaurant -- the fourth in Las Vegas -- which will open by early August.

A third redevelopment phase calls for improving the themed casino adjacent to the Star Trek attraction. The timing for this is so far uncertain.

"With the opening of the monorail, there's going to be a lot more traffic coming through that part of the building," Prieto said.

As phase three starts, Colony will refurbish some of the rooms and suites and consider adding new attractions inside the hotel or outside the main building on undeveloped property.

"We have a total of about 60 acres and there's enough land between Paradise and the front of the property that we can do some interesting development," Prieto said. "We have been having discussions. We want to make the best use of our land."

Going forward, Prieto expects the Las Vegas Hilton to benefit from cross-marketing with Colony's Resorts casino in Atlantic City.

"(Cross-marketing has) already started," he said recently. "We intend to have a strong active casino."

Not everything will change at the property.

"This will continue to be a convention hotel with strong roots in that market," he said, noting expected convention room nights through this year will be at or slightly above the 40 percent level.

"This property has tremendous potential," Prieto said. "We would not have bought it if we did not believe that and we intend to exploit that potential and maximize the return on our investment."

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