SLS Las Vegas is no longer part of a special collection of upscale hotels associated with Hilton Worldwide Holdings Inc., ending the money-losing Strip resort’s access to the major hotel company’s loyalty program.
Several Hilton Worldwide customers who booked rooms at the SLS wrote in an online forum this week that they received messages telling them the resort was not affiliated with Hilton anymore. SLS had previously been included in Hilton Worldwide’s Curio collection, a group of independently operated hotels that are connected to the Hilton loyalty program HHonors.
The SLS also received access to the Hilton reservation system and "participation in Hilton’s marketing initiatives," according to the resort's filings with the Securities and Exchange Commission.
Hilton Worldwide and SLS representatives confirmed in nearly identical statements Thursday that the two businesses had “mutually ended” the franchise agreement between them. The change does not affect normal operations at SLS, and “all existing reservations will remain intact,” the statements said. However, points and benefits from the HHonors program will not be awarded or accepted there.
Neither company explained exactly why they terminated their agreement.
The end of the SLS-Hilton relationship surfaced in a forum on flyertalk.com that included multiple posts referencing a message to certain customers from Hilton Worldwide.
“We regret to inform you that this hotel has ceased to operate as a part of our portfolio of Hilton Brands as of November 4, 2015, and the hotel will be unable to honor your reservation,” the Hilton message reportedly stated. “Please accept our sincerest apologies for this short notice and know that we are working to personally take care of each and every one of our guests.”
The message offered to book reservations at a different Hilton property in Las Vegas, according to flyertalk.
Another alleged Hilton message referenced in the forum said that “all existing reservations beyond November 4, 2015, will be handled by the new hotel operator.”
Hilton’s exit is the latest entry on the long list of speedbumps the SLS has encountered since it debuted in August 2014 as a $415 million reincarnation of the Sahara. Those include the departure of the SLS president two months after opening, the closure of the buffet not long afterward and, more recently, the parting of ways between the SLS and Fred Segal, a Los Angeles fashion retailer that had stores on the property.
Also, Sam Nazarian, the businessman who led the creation of the SLS, has not been closely involved with the resort for almost a year. After regulators raised serious concerns about Nazarian’s past, they gave him an extremely limited gaming license last December that left him barred from the casino operations. Nazarian revealed in between his two regulatory appearances that he was stepping back from day-to-day operations.
Nazarian could have attempted to get full licensure this year, but the state Gaming Control Board just this week gave initial approval for him to withdraw his key employee license. The board also said majority owner Stockbridge Capital can buy the remaining 10 percent interest in the resort.
The Nevada Gaming Commission will have the final say on both of those transactions later this month.
Scott Kreeger, the current SLS president, has revamped the property’s loyalty program and said he recognizes the need to create “drivers” in order to get customers to visit his property. But the resort has yet to overcome the obstacle posed by its location on the far end of the north Strip. It lost $35.3 million in the first quarter this year and $48.7 million in the second quarter.