Caesars Palace's jumbotron was hawking a poker "tournement [sic]" as of last night. Having an ex-Harvard boffin at the helm evidently doesn't raise a company's I.Q. level. You half-expect that sort of spelling gaffe on the marquee at Terrible's; at Caesars, not so much.

It was wall-to-wall people at the Golden Nugget last night. Which goes to show that a scarifyingly depopulated Riviera on Monday night was not indicative of some citywide malaise. (What it bodes for the Riv is less than reassuring, however.) Nugget owner Tilman Fertitta is really packing them in -- at least in terms of bodies, if not dollars -- particularly the retirees. If Anthony Newley shout-outs are your thing, you'll love headliner Gordie Brown.

Thumbs down, however, to some price-gouging we encountered at The Grille, the Nugget's fast-food joint. Two bucks gets you a soda -- in a thimble. And don't be goin' askin' fer no refills, buckaroo, 'cause they're ain't none. Just skedaddle now afore somebody takes a brandin' iron to yer hide, tenderfoot.

[Add Comment]

... not in Station Casinos but in Orange County real estate, it would seem. The neighborhood is popular with casino moguls who have run their companies into the ground: A nearby, $35 million crib is a domain whose master is Jerry Herbst, late of Herbst Gaming, recently surrendered to its creditors.

At least Frank J. Fertitta III can argue that he was bargain-shopping, as his Emerald Beach pied-a-terre was purchased for 24% off list price. Station employees, however, aren't likely to be house-hunting anytime soom.

I'm reminded of something Transport Workers Union representative Joe Carbon said last week: "That's what it's about ... the CEOs making their $25 million and the workers having their health plan cut." He wasn't speaking of Station or Herbst specifically but the consequences of poor leadership at both redound primarily to the workforce -- and the creditors.

[Add Comment]

Unfortunately, it does not involve some Cinemax hottie like Kim Dawson but rather Mayor Lorenzo Langford, who's doing a fan dance involving Bader Field. He's had discussions with interested developers -- too interesting to discuss! He'll have "exciting" revelations -- too exciting to reveal! And it will -- brace yourselves -- "have some connection with casino gaming."

Why, you could knock me over with a feather.

Right-sized into oblivion. The workforce at Palazzo-Venetian has fallen below 7,000 with yesterday's purge of 194 employees. "It's an effort to continue to right-size our business," wailed the company. Geez, if they're so intent on trimming the ship, how 'bout asking for a give-back from their $2 Million Man, President Michael A. Leven?

Sands bombs in Bethlehem. Forget those roseate cash-flow projections Sheldon Adelson made when building Pennsylvania's second-most-expensive casino. Revenues at Sands Bethlehem have been in a steady decline since the place opened, reducing it to the #5 casino in the Keystone State.

Primm and proper. Although Sin City Kitties has closed (sniff!), there's still reason aplenty to visit the Herbst Gaming trio of casinos in Primm, Nev., Liz Benston contends. Most of those reasons entail copious freebies ... or at least bargain-basement prices.

The story doesn't mention the single most interesting phenomenon I've observed out there: a higher-than-[Strip]-average number of African-American and Latino players (it's the most integrated casino floor I've set foot upon). But Benston's look-in makes a strong case for those of us who think Herbst CEO Ferenc Szony is the man to turn these places around.

The money quote is from Szony's man in Primm, General Manager Michael Starr, who says, "I have yet to make money on a vacant room in this business." There's but a few CEOs in Vegas who couldn't stand to have that chiseled into their bedroom wall so that it's the first thing they see in the morning and the last thing at night. Those are words of wisdom, Mr. Starr. Long may you flourish.

There's theatre in Vegas. True, you have to poke around behind the dodgy Sportsman's Royal Manor on Boulder Highway to find it sometimes. But the trip to the dark side is definitely worthwhile.

[Add Comment]

"An improvident indictment." That's what New Jersey officials are calling a case that was quietly quashed in May. Sacked Borgata veep John Conklin and two other men had been charged with plundering the Tropicana Atlantic City's database when they were in the Trop's employ (and when the Trop was still owned by Aztar Corp.).

Closer examination revealed that nothing had been purloined and the data in question was not particularly sensitive, either. All three indictees have been exonerated ... but where does John Conklin go to get his career back?

Phantom redux: Defying the odds, the Venetian's production of Phantom of the Opera celebrated its third anniversary Wednesday night. I jotted down a few observations for CityLife. (Tina Walsh fans, take note.) Having seen the Broadway production -- albeit many years ago -- I'll be the first to allow that it actually improves on the original in a respect or two. Oh, and my CityBlog entry misspells choreographer Gillian Lynne's last name. My apologies.

Two titans of American popular music "played Vegas" last weekend. Actually, Loretta Lynn was in North Las Vegas and Aretha Franklin all the way out in Primm ... not remotely near the Strip. What's wrong with this picture? Or this one ...

Midnight Jim: taking down Big Oil

It's summer and gas prices are -- like, duh! -- on the increase. Gov. Jim Gibbons doth suspect that dark, foul, untoward schemes are afoot. But Midnight Jim assures us he is on the case. I feel safer already.

Gay cowboys. They're queer, they're here and they're at The Rio specifically. A straight-gay coalition turned out in force last night to celebrate its victory over Midnight Jim's benighted opposition to domestic partnerships. (Because that's not how he rolls, y'see.) Speakers included Harrah's Entertainment Vice President Jan Jones, who led the charge on Carson City.

For all the failings of CEO Gary Loveman's stewardship of Harrah's, on his watch the company has expanded its already-enlightened attitude on social issues. It's not just a question of being gay-friendly; it's good business.

Worth -$23 million?

Isle of Blight. Is the woebegone Greek Isles casino-hotel worth less than nothing? In a sense, yes, since it owes $67 million on a book value of $44 million. Even a resale price at book value seems wishful thinking, considering the Isles' chequered history.

Asserts the Las Vegas Sun, "With its strategic location near the Las Vegas Strip and the Las Vegas Convention Center, the Greek Isles and its associated real estate are seen as having long-term value after the recession ends."

Yeah, but it's had that "strategic location" for as long as it's been in existence and the Isles' progress has been a steady one from Bad to Worse. I wouldn't give a plug nickel for the place -- not with Strip land prices in freefall and vast acreage there lying fallow.

Miracles are possible. Work on Marina Bay Sands is, believe or night, a fortnight ahead of schedule. Next step: Hold the line on that (already swollen) $5.4 billion budget.

The waiting continues in the great state of Kansas. Its lottery commission wants another two months to review applications for the Wichita and Kansas City markets. Considering the recent flurry of dropouts (including Vegas' own Golden Gaming), you'd think this would expedite the process. Instead, the coronation is six months away.

Squeeze play. No time is being wasted as Pennsylvania rushes toward expanding into Class III casinos. Two rival proposals to add table games are presently on the table. Casino lobbyist Steve Rittvo is forwarding a plan that would tax new games at 12%. This is projected to generate $165 million for the Keystone State (assuming that slot play concurrently increases sufficiently to generate a $61 million impost).

House Whip William DeWeese (D) counters with a 21% tax, combined with a one-time $10 million/casino fee, for a potential Year One windfall in excess of $300 million. I wish Rittvo luck but fear that solons will -- as they so often do -- gravitate toward the bigger dollar sign. It's an institutional failing.

Neil Bluhm, Philadelphia's Sugar[House] daddy

On a happier note, Neil Bluhm's revised design for his Sugarhouse Casino, on the Philadelphia waterfront, has received the green light from the City of Brotherly Love. Barring further legal mischief by sore loser Donald Trump, this means the project can finally move ahead, with a temporary, 1,700-slot casino slated for a Spring 2010 opening. Hallelujah!

[Add Comment]

In a refreshing change of pace comes news of a casino that's on schedule for its opening. OK, so it's in Dodge City, Kansas, but we'll take good news wherever we can get it these days. Whoever thought avionics firm Butler National would be the sole casino bidder to make good on its Sunflower State commitment?

How quickly we forget that the original plans for Red Rock Resort called for three condo-hotel towers. Station Casinos was feeling its oats back then, thinking big even as it projected only single-digit ROI at Red Rock as far out as 2011 or longer. Overconfident much?

They like us. They really, really like us. Casinos in Southern Nevada feeling the recession's pinch are suddenly overflowing with newfound lurve for area customers, long taken for granted. Here's what's on offer so far. Satellites like Primm and Mesquite weren't any great shakes during Vegas' halcyon years. Why you'd go out there now when oligopolists Herbst Gaming and Black Gaming have helped run their respective markets into the ground is difficult to fathom. (Primm, at least, has a good outlet mall. Mesquite ... not so much.) Oh, and what's wrong with this "Stay and Play Here" graphic?

Goodman one-ups Adelson. Although he's never exuded warm fuzzies toward the Culinary Union, neither has -- to my knowledge -- Sheldon Adelson called his longtime adversary "evil." So Mayor Oscar Goodman stepped into the breach -- or stepped in something. As for the Culinary, it's got much bigger problems to worry about.

Any company that planned an ultra-high-end Elvis Presley-themed resort (a conceptual disconnect if ever I heard one) doesn't have both oars in the water. This one doesn't have money in the bank, either, and may soon have its Strip parcel sold right out from under it.

Las Vegas' best low-cost attraction is on the move, down the road to 1610 E. Tropicana Ave. If there's a guest list for the grand reopening, Elton John isn't on it.

[Add Comment]

That $33 million jackpot scored by Reno resident Rachael Renée Romanick highlights two fallacies surrounding progressive slot jackpots. The first is the urban legend that Megabucks always "hits" at the newest casino. (It's a useful myth, seeing how it would motivate slot players to flock to, say, M Resort on the perception that Megabucks was about to go into a "hot cycle."*) After all, Ms. Romanick's big win occurred at lowly Terrible's Rail City, a Sparks casino** that's not only practically unknown outside Washoe County, it's in bankruptcy too.

Second, casino executives ought to quit railing -- pardon the pun -- against revenue-participation games and take a minute to kiss the shoes of IGT. After all, it's the latter who's responsible for paying the jackpot. Imagine the difficulty Ms. Romanick might have collecting from stoney-broke Herbst Gaming (owner of Rail City) ... or any of a number of casino companies whose solvency is currently open to debate.

* -- a term that a former editor of mine unforgettably dubbed "useless voodoo"

** -- Is that Herbst CEO Ferenc Szony doing the voice-overs on the Rail City Web site? It sure sounds like him and Szony loves to put a personal touch on his casino promotions.

[Add Comment]

Perhaps it was with dry irony that the Las Vegas Review-Journal's latest Station Casinos story's subhead read, "Company blames economy, poached customers." And by whom might those customers have been poached? By Station Casinos itself! The company's imperial overreach has reduced it to gnawing on its own femur, as each new Station property cannibalizes business from somewhere else in the Fertitta empire.

Bad as the 2008 financials were, 2009 is going to be that much worse once the encroachment of M Resort begins to be felt. Last year, Station's casino revenues fell by 11% and ADRs were down comparably. A 14% slippage in cash flow from 2007 meant that a deal valued at a rose-colored 9.7X EBIDTA is now effectively over 11X cash flow. Even had the Fertitta Brothers not insisted upon carting home a half-billion dollars as part of the buyout, its valuation would still have been quite over-optimistic.

(Even in a boom year, Station's proposal to dilute Aliante Station's revenues with a nearby "Losee Station" would be inexplicable. Given the company's current financial performance, it's an idea quite a few fries short of a Happy Meal.)

Elsewhere in the casinosphere, the closest thing to good news was Planet Hollywood's disclosure that it shaved 40% off of last year's losses, thanks to a nearly 8% revenue increase. More alarmingly, the Las Vegas Hilton -- seemingly the one casino-hotel Colony Capital couldn't ruin -- has swung from a profit to a loss.

It's a business miracle! Losses at soon-to-be-cleft Herbst Gaming widened by 60%. Most of that was driven by a -33% downward spiral in slot-route revenues. By contrast, the ouster of sundry Herbsts in favor of CEO Ferenc Szony appears to have given the company's 15 casinos a boost because, as dowdy as some of those places are, their revenue actually grew 1% last year.

For most companies that might be unremarkable; for Herbst it's a miracle. It also puts paid to the Herbsts' face-saving insinuation that, by keeping the slot routes and parting with the casinos, the family was hanging onto the real goodies. I can't even remember the last time I went into a Terrible's convenience store and saw somebody playing the slots.

Humpty Dumpty had a great fall. The Nevada state budget is a two-legged stool, balanced upon gaming and sales taxes. That stool is getting wobblier by the day. Unfortunately, if the Lege has any solutions, it's keeping them to itself.

[Add Comment]

I'm deeply imbedded in other projects today. In the meantime, by way of In Business Las Vegas and GamingFloor.com (source of yesterday's Harrah's Entertainment time warp, too) here's the answer to the question, "How many casino failures can you pack into nine minutes?" Watch it and weep.

[Add Comment]

According to Telegraph correspondent Ben Bland, Macao finds itself in a bind. Peking's efforts to prevent money from being siphoned out of the country have crimped high-roller play, forcing a greater reliance upon mass-market customers. But the recession is cutting into their gambling budgets, too. Who's having the last laugh in all of this? Who else but Stanley Ho? As we're learning, never underestimate old Stan's ability to survive. He's probably found a loophole out of death, too. (But somebody needs to clue Bland in that Celine Dion doesn't play Vegas these days.)

Icahn's in: Well, sorta. Although the former Stratosphere owner is officially making a play for the Tropicana Atlantic City, he wants -- get this -- another six months to close the deal. Since the sale of the Trop was supposed to have been wrapped up 11 months ago, regulatory patience is finally running thin. Keeping the Trop in a 21-month limbo is grossly unfair to its long-suffering employees, too.

Icahn's equivocations could send the Trop caroming straight into the arms of Cordish Co., although it's unclear whether Cordish is still interested. Had chowderheaded, state-appointed trustee Gary Stein -- who was characteristically out of the loop on the Icahn bid -- closed the deal when deals were still to be had, all of this would be ancient history. New Jersey Casino Control Commmission members should be marched off to the woodshed for appointing Stein and then tolerating his interminable (and very expensive) bungling.

Elsewhere in New Jersey, solons have relieved Atlantic City's denizens of their second-class citizen status, albeit with many clauses and exceptions. This was accompanied by the usual howls about casinos wielding untoward influence (they can't even make political donations, which seems blatantly unconstitutional), although "juice" from other industries -- like the sacrosanct horse-racing business -- is implied to be hunky-dory. The horsey set's constant pining for slot machines gets a cold shoulder from the voting public, however.

Remember how I forecast that MGM Mirage's $1.2 billion writeoff of much of the value associated with former Mandalay Resort Group properties was going to kill 4Q08 earnings? Well, it did. However, the company supposedly still doesn't want to take on equity partners in anchor-around-the-neck CityCenter. "I'd be surprised if they dilute the joint venture [with Dubai World]," says a Reuters source. Geez, seems like if they'd "diluted" it with additional partners earlier on, they might not be hawking the family silver to raise completion money. Pride goeth before a ... well, you know.

Literacy-challenged Kitties: There's no better topless show on or off the Strip than the Sin City Kitties, who perform all the way out at Whiskey Pete's (which boasts a surprisingly spacious showroom). OK, I haven't seen Fantasy, probably because Luxor insists on advertising it as "Carrot Top Fantasy." As one wag observed, those are three words that should never inhabit the same sentence.

Anyway, Sin City Kitties is the only topless show I've seen that's predominantly erotic, as opposed to having a good number or three. And none of the girls betrayed signs of "enhancement" on the night we saw it, when it played to an appreciative audience of leathernecks and other servicemen.

However ... somebody needs to inform these pussycats that what they perform is not a "topless review [sic]" -- unless they plan to critique other topless shows from their stage in Primm.

"The Harry Reid Train": The asshat who made this fumbling attempt at an "ambush interview" might want to learn what the "Harry Reid Train" is (or more accurately, isn't) before attempting to smart-mouth Rep. Dina Titus (D-NV). Titus brushes off the uninformed oaf with the contempt he deserves. And hey, that's the "Sin City Express," bucko. Don't go messing up our catchy new brand name.

[Add Comment]

Even if Harrah's Entertainment crashes and burns (read: files bankruptcy), never fear: LBO monarchs Texas Pacific and Apollo Management will still be calling the shots. There's a lovely thought; the very guys who drove Harrah's pell-mell into the ditch -- eradicating literally billions of dollars from the balance sheets -- will retain an iron grip upon the steering wheel.

Another delighted Harrah's bondholder.

Is this what private equity has come to? Run up insupportable debts, make bondholders take a Yul Brynner haircut, and waltz away with the physical assets for pennies on the dollar? The nicest word I can think of for that scenario is "irresponsible."

The house loses: The Herbst family won't even get to keep its anchor casino on Flamingo Road under the terms of a settlement announced last week. Herbst Gaming is trying to spin it as a "win" that it's keeping it slot routes. Too bad Herbst can't have it both ways, as the company's blamed the effects of Nevada's newish smoking restrictions (and thus a decline in slot-route revenues) for much of the company's misfortunes -- something I've been hearing from inside Herbst, too.

If the bondholders are carting off the 15 Herbst casinos, it's because that's where the real money is to be made (even if it was colossally dumb of Herbst to pay nearly $350 million -- a mind-blowing 11.6X cash flow -- for a trio of run-down Primm Valley casinos).* If the slot routes are the golden goose the Herbsts now wish us to believe, no way the family would get to keep them. After all, it's the route revenues which have fallen at a steeper rate than the casino ones.

* -- even after a $67 million "goodwill" writedown, Herbst still paid a taken-to-the-cleaners 9.4X EBITDA for the Primm trio.

At least there's good news via the grapevine -- a rumor making the rounds that CEO Ferenc Szony will be staying with the casino portfolio, running the show on behalf of the creditors. Szony was brought in as Mr. Fix-It after the Herbst Brothers dug the company into an enormous hole. From what I've seen out there at Primm, he's making quite a push-back effort, even if neither the condition of the properties themselves nor Herbst's cash flows gives him the ammo he really needs. If Szony indeed gets that vote of confidence, it gives the ex-Herbst casinos a fighting chance.

[Add Comment]