Hotelier Sam Nazarian agreed to sell his minority stake in the SLS Las Vegas hotel and for his company to give up management of the property on the Las Vegas Strip.
Stockbridge Capital Partners, the San Francisco-based real-estate investor that owns 90 percent of the hotel, agreed to buy the remaining 10 percent owned by Nazarian and his family.
As part of the agreement, the hotel’s 2,354 employees will continue to work at the property, but will now report to Stockbridge instead of SBE Entertainment Group, the company founded by Nazarian.
That means SBE no longer will collect management fees from the hotel, though it will continue to receive licensing fees for the brand. The 1,620-room hotel will remain an SLS hotel through a franchise agreement with SBE.
“Converting SBE’s current management agreement into a license agreement benefits all parties involved—our valued guests and employees, SBE and Stockbridge,” said Terry Fancher, Stockbridge’s executive managing director, in a statement to The Wall Street Journal. He added that it “will give the SLS Las Vegas flexibility to introduce new brands or restaurants.”