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Las Vegas heats up; Zombies overrun Atlantic City

In a benchmark development, three of the four major Las Vegas Strip operators posted higher midweek rates for the July 4-July 10 period than in 2019. Caesars Entertainment was flat, probably due to its sheer proliferation of hotel rooms. MGM Resorts International inched up 2%, Wynncore was +22% and Venelazzo rose 9%. And we’re not even into convention season yet. Weekend rates tended to be stellar: MGM leapt 41%, Caesars hopped 19%, Wynn Resorts vaulted 54% and Las Vegas Sands was up 28%. Obviously the holiday weekend is a big contributor to this phenomenon but who would have thought the Strip would be outperforming 2019 so soon?

Perhaps visitors got a sneak peek at WalletHub‘s finding that Nevada is the third-most-fun state in our great country. It’s tops (like, duh) in access to casino and fourth in arts, entertainment and recreational venues. Surprisingly, the Silver State is 15th in access per capita to amusement parks and 17th in performing-arts theaters (all those casino showrooms, you know … although Las Vegas boasts a remarkably vigorous theatre scene). We could do better in access to national parks, ranking only 24th. Only California and Florida outdid Nevada (we blame Disney), while Mississippi and West Virginia are the least-fun places to be. Nevada has the fifth-fewest marinas per capita but, with the way Lake Mead is shrinking, can you blame us?

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Trump banned; Richmond: The fix was in

Donald Trump won’t be opening a casino in Doral. Neither will anyone else. Not if the Doral City Council has its way. It voted unanimously to bar casino gambling within the city, which encompasses The Donald’s struggling resort. This has nothing to do with Trump’s financial chicanery and moral turpitude (which ought to bar him from a gaming license outright), and everything to do with preserving the letter and spirit of Amendment 3 to the Florida constitution. The latter reads, in part, “This amendment ensures that Florida voters shall have the exclusive right to decide whether to authorize casino gambling by requiring that in order for casino gambling to be authorized under Florida law, it must be approved by Florida voters pursuant to Article XI, Section 3 of the Florida Constitution.” It’s hard to be much clearer than that. The juice job for Trump and Jeffrey Soffer recently passed by the Lege is unlikely to withstand the smell test in court and it certainly flopped with the Doral city fathers.

Stalking horse Eric Trump has been jawboning in favor of Doral for months, telling the Washington Post, “Many people consider Trump Doral to be unmatched from a gaming perspective—at 700 acres, properties just don’t exist of that size and quality in South Florida, let alone in the heart of Miami.” Admittedly, “many people” is usually Trumpspeak for “I’m totally pulling this out of my ass,” but even if Trump fils is right, that doesn’t make it constitutional. The Eric needn’t start putting slot machines in yet; a long court fight is surely looming over the Seminole compact, which has the watertight integrity of a sieve.

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Big Trouble in Little China; The thieving nun

Carrying a 20-year-long grudge, businessman Marshall Hao is suing Las Vegas Sands for $12 billion, claiming it wronged him when it jilted his Asian American Entertainment Corp. in favor of a (short-lived) partnership with Galaxy Entertainment to get into Macao. Although he’s not alleging such, political reasons may have been involved. Hao is a citizen of Taiwan, while Galaxy is firmly China-rooted. He wants 70% of Sands’ operating profits from the 2004-2022 period. The trial will be gaveled into session on June 16. Alas, we no longer have the addled, combative testimony of Sheldon Adelson to anticipate. In the past Sands has stated, “Using a different lawyer every time, AAEC has repeatedly filed lawsuits trying to take credit for that which they didn’t do.” However, the company has a history of promiscuity with regards to its Macanese partners. A $70 million court award to Richard Suen for an unpaid “success fee” still hangs over Sands’ head and the company quietly settled with three local Chinese businessmen for a similar favor.

The timing of the trial is unfortunate for Sands, with reexamination of casino concessions due next year. Whatever dirty laundry is aired is unlikely to redound to LVS’ benefit. Official company rhetoric has even taken a turn for the pessimistic. One of the key points on which the case is sure to hinge is Hao’s contention that the joint proposal submitted by Sands and Galaxy was identical to one already drafted with AAEC. In light of the present imbroglio, Sands will surely line up behind Sociedade de Jogos de Macau in petitioning City Hall to push concession reviews back to 2023. SJM CEO Ambrose So gave the rather weak excuse that the concessions shouldn’t be under consideration while they’re performing poorly financially, thanks to Covid-19 (as though they didn’t have a lengthy track record already). More to the point, he said it would be unfair to some of the concession holders if current travel restrictions prevent them from coming to Macao to testify. Former lawmaker and present casino executive Melinda Chan agreed, doubting that the government could wrap up the process in a year. In any event, Sands is sure to want whatever extension it can get.

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Doing a Favor for Billy Walters

I don’t play golf at all, and the only miniature golf experience I’ve had in the past ten years was playing a few 9-hole rounds on a cruise ship with Bonnie. The putters had steel blades covered in brightly colored plastic. I used a blue one because those were the longest and I’m pretty tall. Bonnie used an orange one. I did okay. I did better than Bonnie did, but this was hardly a real test. 

For some reason, though, I recently had a dream about playing miniature golf for high stakes with some guy. I never learned his name. But I was making fancy shots right and left and ended up with a check from him for about $10,000. Pretty sweet.

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Illinois limps, Ohio races; Flying the friendly skies with Hard Rock

First, the good news. Illinois gaming revenues held steady from April to May. However … they lagged May 2019 by 9.5%, for a gross of $107 million. The shining exception, as ever, was Rivers Casino Des Plaines, which cornered 39% of the market, up 5% to $41.5 million. One has to commend Churchill Downs for making such a strategic acquisition—and wonder what was going through Neil Bluhm‘s mind when he sold this gold mine. Grand Victoria did respectably, down 2% to $13 million, while Harrah’s Joliet ceded 24% to $11.5 million. Hollywood Aurora slipped 13% to $9 million and Empress Joliet tumbled 26% to $8 million. Par-A-Dice slipped 14% to $6 million and Jumer’s Casino Rock Island proved yet again to be an El Stinko investment for Bally’s Corp., toppling 38% to $4 million.

Further south, Argosy Belle‘s $3 million was actually a spectacular, 166.5% improvement on its 2019 performance. DraftKings at Casino Queen slid 29% to $6.5 million (maybe the oncoming sports book will help) while Harrah’s Metropolis shed 20% to $5 million. Illinois politicians think they can continue to force more golden eggs from the casino goose but with slot routes continuing to expand aggressively, the outlook for all but a few Land of Lincoln casinos is bleak, we’re afraid.

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Maryland heats up; Vegas restaurants rebound; Rivers is george

Casinos in the Free State jetted 13% above 2019 levels, grossing $172 million, a new record. MGM National Harbor led with $68.5 million (+16%) and 40% market share. Maryland Live was up 15% to $61.5 million for 35.5% market share, while Hollywood Perryville justified Penn National Gaming‘s faith in the property, jumping 23% to $8.5 million. Ocean Downs gained 19%, also to $8.5 million and Rocky Gap Casino was up 21.5% to $6 million. The only loser was—you guessed it—Horseshoe Baltimore, sagging 5% to $19.5 million. New management at Caesars Entertainment has announced no plans for the property and it’s an open question whether they have any. Now would be a good time. Over in West Virginia, casinos continue to lag the 2021 recovery, down 18%, with Penn Charles Town further behind at -20%. Overall, slots were a relative bright spot, -17%, negated by a -21% dive at the tables.

“I think there’s incredible resiliency,” restaurant impresario Elizabeth Blau says of Las Vegas. There needs to be, as the Great Shutdown took a scythe to Sin City’s dining scene. “Now with the Virgin hotel opening, Resorts World opening, and numerous hotels having major restaurant openings. Major arenas reopening—the old Vegas is roaring back,” Blau contends. The cascade of debuts includes Virgin Las Vegas‘ One Steakhouse (March), Linq Promenade‘s Sweet Sin (April) and Wynncore‘s long-awaited Delilah (July), all perfectly timed to trade in on Las Vegas’ comeback. And that’s to say nothing of the 40-plus eateries Resorts World Las Vegas will unleash upon the market, with something for every price point. Even buffets are returning, albeit few and cautiously. However, if restaurants are on the rebound, their workers aren’t getting the memo. “Half our union is still not back to work. We have half the union back to work and the other half is still waiting for the jobs. Waiting for when they call them back,” groused the Culinary Union‘s Geoconda Argüello-Kline. Even the new ‘right to return’ law can’t redress that.

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Getting nasty in Florida; Police blotter

A “tortured artifice.” That’s what Miami Beach Mayor Dan Gelber (D) calls the new Florida gaming compact in a letter to the Interior Department. He urged them to reject the deal, not because of any issues with the Seminole Tribe, but on account of various baubles appended to the compact to placate private interests. Or, as Gelber put it in a nine-page missive Interior Secretary Deb Haaland, “It was simply a vehicle hijacked by non-tribal casino interests who fully corrupted the legislative and executive process in order to obtain advantages outside of tribal land and in direct contravention to the interests of Floridians.” Gov. Ron DeSantis‘ agenda, Gelber argues, was not to cut a deal with the Seminoles but to appease political donors and “his most important political patron,” Donald Trump. Incidentally, the latter is reportedly planning to flip his Doral resort to a gaming-centric corporation, should it get a casino license, which we didn’t expect.

Gelber accuses DeSantis of accepting free airplane rides and partying on yachts owned by his patrons, then rewarding them with gaming entitlements. “Indeed, their efforts paid off, as Governor DeSantis included provisions in the Florida Compact that set the groundwork for casino expansion for a prime campaign donor at the Fontainebleau Miami Beach and for his major political patron at the Trump Doral.”

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Don’t make mine Manhattan

That’s the word from key legislators, who have made it clear that Gov. Andrew Cuomo (D) would be putting a casino in Manhattan over their dead bodies. “I believe it would be seriously detrimental to the residential and commercial quality of Manhattan,” said Assemblyman Richard Gottfried. Cuomo’s idea of compromise was to allow Manhattanites to hold their nose and choose where on the island a megaresort would go. Sort of a pick-your-poison deal. But lawmakers said that was spinach and to hell with it. “This got really close. It fell apart in the wee hours of the morning,” a source told the New York Post.

Meanwhile, executives for the three interested companies—Las Vegas Sands, Wynn Resorts and Bally’s Corp.—are waiting until January, when solons may revisit the issue. For Sands, which essentially builds convention centers with ‘big barn’ casinos tacked on, a Manhattan site may be crucial. As for Cuomo, he has sugarplum fairies bearing $1.5 million in licensing fees dancing in his head. In theory, it should be a five-way race for a three full-spectrum casinos but everyone and their brother expects MGM Empire State in Yonkers and Resorts World New York in Queens to be juiced into the first two licenses, leaving Sands and its ilk squabbling over the last one.

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How Do You Figure?

I received an email, with numerous follow-ups, from a player wanting to know how many dollars per hour certain games were worth at a particular casino. And he wanted me to give him an answer if he played 600, 800, or 1,000 hands per hour (hph) for various denominations.

It is far easier to ask such questions than it is to answer them. Some of it can be figured by simple algebra (assuming that isn’t a self-contradictory term for you), but some of it depends on unknown things, such as what promotions the casino will run in the future, how large the mailers will be, and other such matters.

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High on the Strip

Hard by Planet Hollywood there’s a strip mall where you can get some egg rolls at Panda Express, satisfy a Big Mac Attack at McDonalds … and buy pre-rolled joints at the little boutique above. Legalized marijuana hasn’t infiltrated casinos yet, but it’s getting closer. (Addendum: Actually, it’s untruth-in-advertising. A source says Rey Las Vegas is just selling CBD product and the “Pre-rolls” is purely for show. Still, a sign of the changing times.)