LAS VEGAS — Circus Circus Enterprises Inc. said Monday that it has agreed to develop a 400-room luxury hotel with Four Seasons Hotels Inc. as part of a $700-million-plus resort complex it is planning for the Las Vegas Strip.
Financial terms of the agreement were not disclosed.
The proposed hotel, which Circus Circus will own and Four Seasons will manage, will be connected to a 4,000-room hotel-casino the Las Vegas-based company is planning to build on the site of the Hacienda Hotel & Casino. Circus Circus plans to tear down the Hacienda and begin construction on the project by year's end.
The agreement with Four Seasons positions Circus Circus to attract wealthier gamblers to its planned casinos, said Joe Coccimiglio, an analyst at Dean Witter Reynolds in New York.
"They are clearly going after the upper part of the market, which is a surprise because that hasn't been their history," he said. The company's 13 Nevada properties and its Illinois and Mississippi riverboats typically cater to middle-class gamblers, Coccimiglio said.
Circus Circus and Toronto-based luxury hotelier Four Seasons will also team up to develop casino hotels overseas, Circus Circus said.
"The brand recognition of Four Seasons Regent will be an important asset to Circus," said Circus Circus Chairman and Chief Executive Clyde Turner in a statement. Four Seasons owns and manages luxury hotels under the Four Seasons and Regent names.
Circus Circus shares rose $1.50 to $42 on Monday on the New York Stock Exchange.
The agreement with Four Seasons is part of a larger development Circus Circus plans for 120 acres it owns on the Strip.
In addition to the 4,000-room casino hotel and the Four Seasons Hotel, Circus Circus plans to build several other casinos on the land in the next few years.
The company expects to spend about $1.9 billion improving and expanding its hotel and casino operations over the next four years, with much of that going to construction on its undeveloped Strip property. The company said it expects to reap about $1.2 billion in cash flow, or earnings before interest, taxes, depreciation and amortization, in that period.