Morgans looking to unload properties, taps new chief

Morgans Hotel Group Co., which recently gave up its minority stake in the Hard Rock Hotel in Las Vegas, has been shopping other properties and has decided on a new chief executive, according to an analyst and published reports.

Reuters on Friday reported Morgans was looking to sell The Delano in Miami for about $145.5 million, as the company seeks to pay down debt of $660 million.

The hotel company has chosen Michael Gross to be its new chief executive officer, replacing current CEO Fred Kleisner. Morgans was also expected to hire Dan Flannery as chief operating officer and Yoav Gery as head of development, both from Marriott.

"Our view is that these changes, taken as a whole, suggest that there could be further capital restructuring forthcoming in the form of asset sales and capital recycling," said David Katz, an equity analyst with Jefferies & Co., in a note to clients Friday.

Katz said he expected the company to put more focus "on increasing its brand distribution."

Morgans lost its equity stake in the Hard Rock on March 1 after the Nevada Gaming Commission approved Brookfield Asset Management Inc.'s proposal to assume ownership of the hotel.

The decision also ended the company's management agreement for the property that stands along Paradise Road just east of the Strip. The company's debt associated with the Hard Rock was $184.5 million, according to a regulatory filing.