Iconic State Border Hotel & Casino Closes Indefinitely

With Canadians boycotting American vacations due to tariffs and the cost of living shooting through the roof in recent years, tourism to Las Vegas has been on a downswing. In June 2025, there was an 11.3% drop in visitors to our city compared to the same time last year. This equates to 400,000 fewer tourists for that month alone. This drop in tourism is also reflected by fewer incoming flights at Harry Reid International Airport and higher hotel vacancy rates both on and off the Strip. However, convention attendance remains strong, with rates actually higher than they were in 2024. So, if more people are coming to our city to work, and fewer are coming to play, what does it mean for our local businesses? For those geared towards having a good time with family and friends, it could be negative, with one recent bankruptcy filing demonstrating what could happen to these companies due to the current decline in tourism.

Not everyone who comes to the Las Vegas Strip wants to spend their entire time here drinking and gambling. Electric Playhouse is an entertainment venue located in The Forum Shops at Caesar’s Palace. It features games, interactive exhibits, and of course, a bar for customers 21 years and older. This company is based in Albuquerque, New Mexico, but expanding to Las Vegas seemed only natural. There are plenty of entertainment venues in and out of hotels on the Strip that offer alternatives to sitting at a card table or slot machine. For now, Electric Playhouse doesn’t have plans to go anywhere. But with between $1 million and $10 million in both assets and liabilities, this company will need a solid game plan to emerge from bankruptcy and succeed in the future.

Chapter 11 bankruptcy is marked by the option for struggling businesses that use its protections to reconfigure and continue operating, hopefully at a profit. When a business or individual files for chapter 11 bankruptcy, they become protected by the automatic stay as if they had filed for chapter 7 or chapter 13 bankruptcy. The automatic stay prevents the seizure of assets, foreclosures, lawsuits, and other collection efforts by creditors. This gives the business more time and resources to dedicate to coming up with a suitable bankruptcy plan. Some businesses emerge from chapter 11 bankruptcy by finding new investors, or convincing existing ones to provide more funding in exchange for more equity in the company. Successfully emerging from bankruptcy could require closing locations, selling off equipment and inventory, or pivoting the business to an entirely new model. Closing the business for good is also an option through chapter 11 bankruptcy. A committee of the company’s top creditors will vote to approve the plan to emerge from bankruptcy. The committee can also vote on other important issues throughout the lifespan of the bankruptcy case. There is no set time frame for how long this process takes in chapter 11 bankruptcy.

While individuals are eligible to file for chapter 11 bankruptcy protection, it is much more common to see them use chapter 13 or chapter 7 bankruptcy for debt relief. They are less common among businesses because of eligibility and limited options to remain in operation. But they provide powerful benefits that a debtor can leverage to a more positive financial and credit situation post-bankruptcy. If you live in the Henderson/Las Vegas area and need help with your debt, our firm offers experienced guidance and free consultations by phone. Contact Henderson Bankruptcy Lawyers today at 702-899-3328 to learn more.

Other Recent Bankruptcy Filings Affecting The Las Vegas Area

Electric Playhouse’s bankruptcy filing is just one in a long line of cases affecting Las Vegas recently. It is currently a tough economy for casinos, restaurants, and other discretionary and luxury expenses that many people don’t have the budget for right now. Also, sports betting apps have made it possible for most people across the country to gamble without ever getting off of their couches. Some recent bankruptcy filings affecting the Las Vegas area include:

Maverick Gaming: This casino company specializing in poker filed for chapter 11 bankruptcy in July 2025. It stated that it had between $100 million and $500 million in liabilities in its bankruptcy petition. Maverick Gaming has five Nevada casinos, which will continue running despite the bankruptcy. They include the Maverick Casino & Hotel, Gold County Casino, Wendover Hotel & Casino, and Red Garter Hotel & Casino. The Nevada Gaming Control Board is monitoring this reorganization bankruptcy case. This is the first gaming company to file for bankruptcy since 2023, and the first casino operator to file for bankruptcy since Caesar’s did in 2017.
Velocity Esports Las Vegas: This is a video game arcade located off the Strip at Town Square Mall. It filed a voluntary chapter 11 bankruptcy petition on May 7, 2025, listing between $1 million and $10 million in debt. Experts blame this bankruptcy filing on a few causes. First, this company expanded rapidly into large spaces. Its arcades require between 15,000 and 22,000 square feet of real estate. Spaces this large require large volumes of customers to run at a profit. And Velocity Esports drained its cash reserves by opening three locations in less than three years. This left it without a safety net as the cost of living began sharply rising after the pandemic, leading more people to spend less on entertainment. The Las Vegas Velocity Esports location is still open, despite its chapter 11 bankruptcy case.
Hooters: This controversial chicken wing restaurant has locations across the country, but Las Vegas boasted its own Hooters hotel and casino, now known as Oyo. Hooters filed for bankruptcy in spring 2025, and the original founders have since made a plan to purchase some of its franchise locations and pivot away from the “breastaurant” model. But the Oyo Hooters location has since closed, just like the Palms Hooters location did in 2017. A Twin Peaks at Harmon Corner also closed in 2020. Experts pinpointed the scandalous nature of the restaurant as one of the reasons it was forced to file for bankruptcy, with more explicit and affordable content widely available on the internet.

Considering Your Own Las Vegas Bankruptcy Filing? Start Here With Your Free Consultation.

Las Vegas is a city with more people on average working in hotels, restaurants, and other businesses centered around tourism. When tourism falls, so does the income of people working at these establishments. For those who don’t have a substantial safety net in place, this might mean incurring debt to pay for expenses during a lull in tourism. Credit cards, personal loans, and other lines of credit can carry unfavorable terms for the borrower, like high interest rates. It can be difficult to get out from under this type of crushing debt without some help. If you’re struggling with debt due to falling tourism in Las Vegas, bankruptcy may be able to clear your obligations and protect your assets from creditors. Our firm makes getting started easy with flexible payment options and free appointments by phone. Schedule your free consultation with Henderson Bankruptcy Lawyers today at 702-899-3328 to learn more.