Las Vegas Advisor

Posted on December 2, 2022September 14, 2023 by David Mckee — Leave a comment

MGM: Change partners and dance; 888 TKO’d

It’s Blackstone Group out, Vici Properties in at MGM Grand and Mandalay Bay, as Vici exercised its option over the half (OK, 49.9%) that it didn’t already own. Blackstone is $2.8 billion richer as a result, including $700 million in profit. MGM Resorts International will pay $309 million a year in rent. Despite leverage concerns, Deutsche Bank analyst Carlo Santarelli wrote that “the elimination of a messy joint venture structure in an otherwise easy to understand/forecast business model” was a leading positive. He added, “while the transaction has several fundamentally positive merits, we question whether this transaction would have been feasible/executed if not for the fact that ~55% of the total purchase price was locked in at an inexpensive cost of debt.” It also increases Vici’s stranglehold on the Las Vegas Strip … but we defer to the experts.

Posted on November 30, 2022September 26, 2023 by David Mckee — 1 Comment

Winter in Atlantic City

Borgata is putting its best foot forward for the holiday season, as can be seen here.

Posted on November 29, 2022August 24, 2023 by Bob Dancer — 12 Comments

Adventure at Railroad Pass – Part 1 of 2

Railroad Pass was built some 90 years ago. Insofar as Las Vegas casinos go, that’s ancient. Railroad Pass isn’t actually in Las Vegas, of course. It’s in Henderson, almost to Boulder City. At the time this story happened, almost 20 years ago, they actually had a traffic signal in the middle of the 95 freeway to get into the place. In addition, it was owned by the MGM – Mirage corporation, although totally separate from that players club. Today that signal is gone, and MGM no longer owns a piece of the Pass.

A lot of the machines were coin-droppers. With a 0.25% slot club, I favored dollar 9/5 Triple Bonus Poker Plus (99.80%) on Wednesdays, which was 3x point day. I couldn’t get many dollars per hour through the machine. When credits on the machine exceeded 400, dollar coins fell into the hopper. Quad 2s, 3s, and 4s ($600) were a hand pay, as were four aces ($1,199). It was about a $20-per-hour play, but they had mailers and comps which added considerably.

Posted on November 29, 2022September 14, 2023 by David Mckee — Leave a comment

Strip flattens, LV locals rebound; Hyatt’s Vegas Dream

That great Las Vegas recovery on the Strip suddenly flattened in October but new signs of vitality were evident in the local-gambler sphere. Las Vegas Strip casinos grossed $706 million, almost dead-even with the year before. Locals-derived win, meanwhile, surged 11%. Downtown‘s $90.5 million was a 19% vault, while an 18% leap happened on the Boulder Strip ($80 million). Similarly robust numbers were reported by miscellaneous Clark County ($143.5 million, +9%), Laughlin ($45 million, +10%) and Mesquite ($16 million, +7.5%). North Las Vegas lagged somewhat, up 3% to $23.5 million. Further afield, Reno was up 3% to $64.5 million, while new Legends Casino in Sparks continues to fuel play, hopping 14% in town to $16.5 million. Lake Tahoe got in on the fun, climbing 13% to $18 million and Wendover was up 6% to $23 million.

Posted on November 28, 2022September 14, 2023 by David Mckee — 1 Comment

Risky mandate in Macao; Penn’s problems; Debacle at Mirage

That sowing sound you hear is casino executives from Las Vegas to Hong Kong heaving a gargantuan sigh of relief that all the incumbent gaming concessions in Macao were renewed last weekend, leaving Genting Group still on the outside looking in. Some Wall Street analysts made fools of themselves by rushing out on a limb and predicting Genting would make the cut. Considering that it had no presence on the ground in Macao, Genting’s bid was pretty rash and we’re not at all surprised that Chinese authorities ultimately backhanded it. But it was useful for putting a scare into the senior concessionaires and getting them to pony up billions upon billions of dollars for non-gambling attractions that are probably not going to be very remunerative, barring a drastic transformation in the makeup of the Macao-bound traveler. (Maybe that Hello Kitty theme park mooted by SJM Holdings will be making a comeback.) As The Associated Press put it, “the requirement to spend on theme parks, music and sports adds to financial pressure at a time when revenue has plunged under anti-virus restrictions.”

Posted on November 23, 2022September 14, 2023 by David Mckee — 3 Comments

Coney Island casino?; Mirage volcano scrapped

While New York Mets owner Steve Cohen and Las Vegas Sands continue to dither about how they might, maybe, possibly have something brewing in Flushing, other players—much lower-profile ones—have been making a move. A consortium of the Chickasaw Indians, Saratoga Casino Holdings, Thor Equities and Legends are pitching a “comprehensive casino, hotel, and entertainment proposal” for Coney Island. Which we think would be a logical spot for gaming and would drive more entertainment dollars to the Rockaway area, especially in cold-weather months. Now, this foursome doesn’t have the name-brand cachet of Caesars Entertainment or Wynn Resorts, both of whom have dibbed Manhattan, but the former is at war with the Theatre District and the latter is evincing cold feet about the whole thing.

Posted on November 22, 2022August 24, 2023 by Bob Dancer — 24 Comments

Dazed and Confused

I recently received this email — slightly shortened and lightly edited:

Just got back from my first trip to Mohegan Sun in Connecticut and Foxwoods.

Posted on November 22, 2022September 14, 2023 by David Mckee — 1 Comment

Report from Chicago; Gray Lady in high dudgeon

If you have a bridge in Brooklyn or perhaps some swamp land in Florida, then Oak Street Real Estate Capital would like to hear from you. It just paid $200 million for the site of Bally’s Chicago and $300 million for a share of an imaginary casino yet to break ground. Oak Street, understandably “declined to comment” on the deal when the Chicago Tribune came calling. You have to hand it to Bally’s Corp. It literally got something for nothing, even though it’s still at least $1.2 billion shy of the finishing line. And selling off its empire to pay for tomorrow has its limits, as Bally’s is fast running out of things it can peddle. At least Gaming & Leisure Properties got tangible value when it paid Bally’s $1 billion (insert Dr. Evil inflection here) for Bally’s Rhode Island assets. Oak Street just got played.

Posted on November 21, 2022September 14, 2023 by David Mckee — 7 Comments

Atlantic City slumps; Adele hell

Dateline: O’Hare International Airport, land of crappy wi-fi.

We’re not back at the office yet but there’s so much news it just can’t wait. Let’s start in Atlantic City, where casino revenues slumped 7% to $220.5 million last month. Everybody was revenue-negative with two happy exceptions, Borgata (+1%) and Hard Rock Atlantic City (+4%). The latter’s Joe Lupo definitely has some secret sauce for attracting players. Borgata raked in $62.5 million to Hard Rock’s $39 million. Ocean Casino Resort had an abnormally poor month, down 6% to $28 million. Even so, Ocean still outperformed all of the Caesars Entertainment properties, with Caesars Atlantic City tumbling 17% to $17.5 million and Harrah’s Resort also falling 17% to $20 million. Tropicana Atlantic City slid 18% to $17.5 million. Golden Nugget ($12 million, -16%) and Resorts Atlantic City ($13 million, -11.5%) duked it out for last place but were aced by Bally’s Atlantic City ($11 million, -13.5%), which means we look forward to hearing the Bally’s Corp. braintrust spin that on their next earnings call.