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|Morgans Hotel Group Issues Statement Regarding Echelon Project in Las Vegas|
NEW YORK--(BUSINESS WIRE)--Aug. 1, 2008--Morgans Hotel Group Co. (NASDAQ: MHGC) ("MHG") today issued the following statement regarding the announcement by Boyd Gaming Corporation (NYSE: BYD) that it will delay the entire Echelon project due to the difficult environment surrounding today's capital markets and current economic conditions. In January 2006, MHG entered into a 50/50 joint venture with Boyd to develop a Mondrian and Delano within Boyd's Echelon development on the Las Vegas strip.
As MHG previously announced on July 1, 2008, the deadline to obtain construction financing for the Echelon project was extended to September 15, 2008. Given Boyd's announcement and the difficulties in the credit markets, MHG believes that the joint venture will be unable to secure financing at favorable rates and conditions by September 15, 2008. MHG does not intend to further extend the joint venture agreement on its current terms but expects to evaluate future proposals relating to the project with Boyd.
About Morgans Hotel Group
Morgans Hotel Group Co. (NASDAQ: MHGC) operates and owns, or has an ownership interest in, Morgans, Royalton and Hudson in New York, Delano and The Shore Club in Miami, Mondrian in Los Angeles and Scottsdale, Clift in San Francisco, and Sanderson and St Martins Lane in London. MHG and an equity partner also own the Hard Rock Hotel & Casino in Las Vegas and related assets. MHG has other property transactions in various stages of completion, including projects in Miami Beach, Florida; Chicago, Illinois; SoHo, New York; Las Vegas, Nevada; Palm Springs, California; and Boston, Massachusetts. For more information please visit www.morganshotelgroup.com.
CONTACT: Morgans Hotel Group Richard Szymanski, 212-277-4188 OR Joele Frank, Wilkinson Brimmer Katcher Andi Salas, 212-355-4449 SOURCE: Morgans Hotel Group Co.