Monarch, the corporation responsible for day to day operation of the Atlantis Casino in Reno, Nevada, and the Monarch Casino Black Hawk in Black Hawk, Colorado, had originally signed PCL Construction Services on to act as the General Contractor for their extensive expansion project in Black Hawk.
Weifield Group Contracting, Inc, a subcontractor hired by PCL, was the first contractor to file a lien claim against Monarch Casino & Resort. Weifield Group filed a claim under Colorado mechanics lien law on February 16, 2021, for $7.8 million. The subcontractor later amended their lien on May 4, bringing their total claim to nearly $10.5 million.
By February 24, four other subcontractors had followed suit. On February 19, Summit Sealants, Inc. and Floorz, LLP filed claims for $323,000 and $161,000, respectively. Five days later, Spacecon Specialty Contractors, LLC, and Heggem-Lundquist Paint Company filed lien claims for $12 million and $2.8 million, respectively. Finally, on February 26, PCL Construction Services filed their own mechanics lien for $45.5 million.
On June 1, 11, and 16, 2021, PCL construction filed separate lawsuits to foreclose on the property at 488 Main St. In addition to naming Black Hawk Casino and multiple subsidiaries in the lawsuit, PCL listed dozens of subcontractors as defendants in the filings, including Weifield Group Contracting and Spacecon, two of the contractors who previously filed their own lien claims.
The subject of the expansion project, the new hotel and casino grounds, saw multiple cost increases from the projected $320 million cost to a final total of $442 million. The new expansion opened on November 19, 2020.
The strained relationship between Monarch Casino and PCL Construction Services has also hosted a previous litigatory dispute, filed in August of 2019.
Allegations of failed payments against Monarch constituted the bulk of the suit, reaching $205 million in unpaid bills by the end of that year. This lawsuit, in tandem with the aforementioned operating conditions forced by the onset of COVID-19, has substantially slowed the completion of the expansion project, which was originally scheduled to be unveiled in late 2020. Monarch described the legal situation as “an effort (by PCL Construction) to deflect attention from their failures to deliver the completed project in a timely and cost appropriate manner.
Funded by investment money from Monarch, the project added a 23- floor hotel, nearly doubling the square footage of the casino and adding 516 rooms, containing guest rooms, restaurants, bars, pools, and spas.
Even while tied up in legal disputes with PCL, Monarch Casino confidently predicted and then delivered a soft opening of some of the amenities built in the expansion project. The casino held a grand opening in November 2020, with the first 13 floors made available for customers to peruse. The additional nine floors are expected to open in the second phase.
Monarch has made no comment about the liens or lawsuits at this time.
Hospitality projects have had to adapt to pandemic setbacks
Casinos in Black Hawk and Colorado as a whole have also had to make significant adjustments to allow for proper response to the global pandemic. While casinos were allowed to reopen in June of 2020, table games were prohibited in an effort to enforce necessary social distancing measures.
Other measures — including prohibiting the sale of alcohol on the premises after 11 P.M., and reducing the maximum indoor capacity to 100 people — were enacted to attempt to curb the significant spike in cases that the state of Colorado saw in October of last year, with approximately 32 cases per 100,000 people.
The hotel industry also endured a dramatic shift in 2020, seeing a loss of more than 670,000 jobs in hotel operation, according to the AHLA’s State of the Hotel Industry report. Compared to the meager addition of only 200,000 jobs, the industry is seeing a significant downturn from which recovery isn’t projected until 2023.
In a divergent trend, the report also projected that nearly 56% of Americans expect to travel for leisure in 2021, with the widespread availability of vaccines and more stringent cleaning practices allowing for peace of mind in consumers.