Clark County records have shown that for a whopping sum of $50million, Hiam Gabay, the one-year-old tenant operator of the popular 2-acre gift shop Bonanza, has bought the property after receiving $10 million and $25 million loans from the seller of the property and a bank respectively. This comes in at a time when investors have been spending billions of dollars purchasing properties especially malls on the strip. Gabay was said to have sold two of his shops on Fremont Street to Derek Stevens for about $13.5 million, which he used to partly finance the purchase of Bonanza.
Bonanza is the world’s largest gift shop located at the corner of Las Vegas Boulevard and Sahara Ave. Established in the 80s, the gift shop ousted two casinos (Honest John’s Casino and Big Wheel Casino from where it got the big round sign) and some smaller stores along the strip to occupy over 40,000 square feet of the shopping space it sits on today.
Sometime in 2014, the owner of the store Lynn Morris was reported to have sold the gift shop to MGM, although the reports were denied by Morris. Then in October 2015, another report surfaced about the sale of the gift shop to PRE Sahara Square LLC, a group which wanted to buy into the increasing likelihood of a rebirth of the Strip.
The sale of malls and shops at the strip came at a time when land investors decided to ignore undeveloped lands parcels and projects on the drawing boards because tourists were spending their money elsewhere other than in casinos. First, The Shop at Crystals was acquired by a property group based in Indianapolis, Simon Property Group alongside Invesco of Atlanta. Then came TIIA that bought 50% stakes in Fashion Show and Miracle Mile Shops which was also sold to Calpers and Miller Capital Advisory.
John Knott, a Las Vegas broker in a statement said that Bonanza could have fetched its owners as much as $70 million if they had sold it the previous year while also pointing out that Gabay would continue managing the shop for as long as possible, adding that so far, Gabay had done very well in running the shop owing primarily to the fact that the shop had always interested him.
Speculators in many quarters are of the opinion that one of the reasons why investors were buying up malls on the Strip is because the IRS permitted them to postpone tax payments on profits from such properties if they reinvested the proceeds into similar properties.
Many who patronize the Bonanza are hopeful that the shop would still have in stock the souvenirs and other items they are used to buying such as Polly the Foul-Mouthed-Fowl.
What is your favorite purchase from the Bonanza Gift Shop??
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