Don’t look now, Las Vegas but we may have another failsino on our hands. Construction has ground to a total halt on Dream, the south-Strip resort project that looked like a sure thing not so long ago. Developer Bill Shopoff is as much as $30 million in hock, stalling work on Dream. Shopoff is evidently renegotiating with his principal lender, for reasons undisclosed. (Cost overruns?) With a budgetary cap of $575 million, Dream has been proceeding so far from cash on hand, leaving it $400 million-plus short of the finish line. That’d require a “bridge loan” big enough to span Long Island Sound.
It’ll take anywhere from two weeks to a month for Shopoff to line up his money and, in the meantime, he’s blaming the Federal Reserve and rising interest rates for the stoppage. In the meantime, liens on Dream are piling up. Interestingly, Dream Hotel Group owner Hyatt Hotels, which picked up Dream’s operations for a song last year, seems to be sitting on its hands while the current drama plays itself out.
We’ve been hearing that Virgin Las Vegas is struggling and lo and behold, CEO Richard Bosworth is falling on his sword. According to an internal memo obtained by Vital Vegas, Bosworth is leaving “to pursue other ventures” (like updating his resumé), effective March 31. On the one hand, last year was supposedly the hotel’s best ever. On the other, the casino—operated by Mohegan Sun—is often described to us as “not particularly busy.” For what it’s worth, Bosworth will be retaining his investment position in the property.
During Bosworth’s five-year tenure, Virgin Las Vegas enjoyed a high media profile and suffered the setback of having to operate most of that time without a sports book (partnering with British Betfred appears to have been a bad idea). It also encompassed the Covid-19 pandemic, which didn’t help Virgin’s cause any. The jury remains out on the eventual success of Virgin LV, which is managed and sub-managed by a dizzying array of ownership groups and managerial entities. It sounds like there will be precious little time to scare up a replacement for Bosworth but he hope they find someone at least as good.
Detroit casinos yielded $105 million last month, down 8% from 2019 (the only comparison available). MGM Grand Detroit, unsurprisingly, grew market share, up 1% to $50 million. Hollywood Detroit fell 10% to $24 million, leaving $31 million for MotorCity. Bigger action was in Internet casinos, which grossed $148 million. BetMGM was out in front with $48.5 million, trailed by DraftKings‘ $33 million and FanDuel’s $29.5 million. Others in the hunt were BetRivers ($8 million), Caesars Sportsbook ($5.5 million), WynnBet ($5.5 million) and Barstool Sports ($3 million). Also registering were FoxBet ($3 million) and BetGLC ($2 million).
Sports betting brought in $23 million on handle of $345 million, a tally that was even leaner after 63% of the winnings were flung back into the market in the form of promotions. In terms of grosses, FanDuel was way out front with $14 million ($8.5 million after giveaways), followed by DraftKings and BetMGM ($3 million each). Once promos were deducted, DraftKings, Barstool and BetRivers all finished in the red. Operators with big goose eggs included Bet America, Parx Casino and WynnBet.
Yet another state that’s having taxman’s remorse involving sports betting is Tennessee. Lawmakers have been looking at hold numbers and gotten dollar signs in their eyes. Currently, sports betting is taxed at 20% of adjusted gross income. The Lege wants to change that to 1.85% of handle. A bit of “napkin math” by Legal Sports Report, however, shows that this would actually boil down to less money for the state than it makes under the current setup. Something very much like this was proposed in West Virginia, too, but got shot down. The OSB operators may have themselves to blame for this Volunteer State intervention. BetMGM, Caesars Sportsbook and DraftKings all browbeat the Lege for an end to the state’s mandatory 10% hold. Instead, they got hit with “true-up” fines. And now this. Let’s hope sense prevails in the state house.
Jottings: J. Brin Gibson may not have been the worst Nevada Gaming Control Board chairman ever, but he was certainly the most controversial, given the close ties between his law firm and the gaming industry. Vegas Inc. has a puff piece on Gibson, in which it lobs him softball questions and he gives sob-story answers. Since he’s still in a “cooling off” period, he has little of pertinence that he can say about Big Gaming … Hard Rock Bristol, in Virginia, grossed $14 million last month. Business is so good that ownership is adding a multiplicity of new slots and table games, bringing the inventory to 890 and 29, respectively … Over 1.5 million visitors streamed into Macao last month, giving the enclave its best February since 2019. Sequentially, it was a 14% improvement on January and saw $1.3 billion in gambling revenue … Sports betting continues to progress in Kentucky, having been voted out of a state Senate committee. However, it needs a supermajority in the whole body for it to reach Gov. Andy Beshear‘s desk … Thanks to a new compact with the state of California, the casino floor at Graton Rancheria could soon be the Golden State’s second largest. Gov. Gavin Newsom signed off on a compact that allows Graton Resort & Casino to go from 3,000 slots to 6,000. To put that in perspective, Wynncore has the most slots in Las Vegas—a mere 1,850.