Fox Rothschild Team Completes Complex New Markets Tax Credits Transaction for Eclipse Theaters Development Group, Paving Way for Las Vegas Theater FacilityJuly 1, 2015 – Press Releases
A team of attorneys from Fox Rothschild LLP, led by partners Paul Wassgren and Mark Connot in Las Vegas and Daniel Madrid in Princeton, recently completed a complex $19.8 million financing transaction on behalf of the firm’s client, Eclipse Theaters Development Group LLC. The multifaceted transaction, undertaken through the federal and state New Markets Tax Credits (NMTC) programs, will allow the company to complete the planned upscale, concierge-style Eclipse Theater complex in the revitalized downtown area of Las Vegas. The transaction is among the first to be completed under Nevada’s NMTC program.
Created by the Nevada Legislature in late 2013, the state’s New Markets Tax Credit Program was designed to support economic development and job growth through targeted investments in economically distressed communities. Under the program, Nevada allocates tax credits to community development entities (CDEs), which serve as an intermediary for providing loans or investments for qualifying projects such as hospitals, office buildings, infrastructure improvement and manufacturing ventures. The state program is based on the federal NMTC program, which was passed by Congress in 2000.
Affiliates of Clearinghouse CDFI and Stonehenge Capital, the CDEs in the transaction, contributed $12.3 million of subordinated construction financing toward the theater facility, a portion of which was sourced from New Markets Tax Credit equity from U.S. Bank. An additional $7.5 million of short-term bridge debt was financed through a private construction lender.
Upon opening, the 550-seat Eclipse Theater, located on South Third Street in the heart of downtown Las Vegas, will feature eight auditoriums and offer VIP amenities, including in-movie dining and a bar and lounge. The venue plans to host both for-profit and nonprofit events, including movie premieres, corporate events, concerts and comedy shows, while incorporating job-training for veterans and youth development opportunities.
“Developing large scale projects is rarely an easy task” said Nic Steele, managing member. When dealing with complex transactions, it is so important to have good partners. Working with Dan, Paul, and the Fox Rothschild team was one of the best decisions we made early on. It took tireless dedication and ingenuity to set Eclipse Theaters on course to break ground this summer and open in Spring 2016. We look forward to adding value to the community and building on the momentum here in Downtown Las Vegas.”
“We are pleased to have assisted Eclipse in achieving its business goals through this transaction,” Wassgren said. “In more than 10 years of handling business transactions in Las Vegas, this is the most complex deal in which I’ve participated. It is gratifying to facilitate a development that will help revitalize and hopefully attract further investment to the downtown Las Vegas community.”
Madrid added, “Without the New Markets Tax Credit program, projects like this one would not be possible, and the hope is that this theater acts as a catalyst to the redevelopment of this portion of downtown Las Vegas. Despite the ups and downs in the process, it was truly a pleasure working with dedicated professionals like Eclipse managing member Nic Steele, my colleagues in the Las Vegas and Los Angeles offices, and the entire transaction team in bringing this important project to fruition.”