Parq Vancouver’s financial woes increase as it misses payment deadline
The casino’s parent company skipped out on an interest payment and its 30-day grace period
Parq Holdings LP, the company that operates the luxury casino Parq Vancouver in Canada, is having money-flow problems. The casino operator has a second-lien loan on the property and an interest payment was due at the beginning of last month. Parq wasn’t able to make the payment on time and, after a 30-day grace period that just expired, has still not made good on the loan’s payments.
The company took on the debt when it tried to refinance the venue in order to develop one of the largest private venues in British Columbia. It apparently bit off more than it could chew, though, and has not been able to keep up with its fiduciary responsibilities.
Parq lost $114 million last year and has seen a continued decline in traffic, exacerbating the company’s financial issues. It had planned to replace the high construction loans with cheaper options, but the slowdown is making it difficult to secure the necessary financing.
However, things may be changing. According to a statement by Parq, “Parq is solidly on track to close a new equity and finance package, replacing our existing development and construction financing.”
In the meantime, though, Standard & Poor’s (S&P) Global Ratings downgraded its status from CCC to selective default yesterday. It asserted that Parq’s decision to defer payment and its reduction in liquidity and inability to comply with the terms of the loan as reasons for the downgrade.
S&P added, “We will reevaluate our ratings on the company once it successfully executes the proposed refinancing of its existing capital structure.”