Barry Sternlicht’s Starwood Capital Group LLC is bidding to take over Riviera Holdings Corp., four years after a bid he backed was rejected by shareholders.

Las Vegas RivieraBloomberg reports that Starwood Capital has acquired Riviera’s first mortgage for about 50 cents on the dollar and is negotiating a pre-packaged bankruptcy. Riviera, which owns a Colorado casino in addition to the 55 year-old Las Vegas resort, defaulted on a US$245 million loan last year.

In 2006, a group headed by Sternlicht offered to buy Riviera for US$17 a share; Riviera shareholders rejected that offer, and the stock now trades for about 40 cents.

Starwood Capital could own Riviera’s 26-acre resort for “about US$5,000 a room, which is less than the cost of the furniture,” Sternlicht said in a February conference call. “I’m thinking of it as a long-term parking lot. We’re just going to hold it and have very little invested in the deal.”

Riviera Hotel & Casino Las Vegas, located on the northern Vegas Strip, has 2,075 guestrooms.