Savior for Lucky Dragon?; Louisiana city shops for riverboat

Things go from bad to worse at ill-named Lucky Dragon Casino. Already it was looking at a foreclosure auction tomorrow. Now owner Andrew Fonfa has put it in Chapter 11. The move was rationalized on the grounds that letting the bankruptcy court auction the resort would preserve the greatest amount of value. Conceivably someone like Station Casinos could snap up Lucky Dragon and mothball it, simply to keep competition off the market. However, both Station and Boyd Gaming found Lucky Dragon no threat to their Asian-centric Palace Station and Gold Coast casinos. Besides, as Union Gaming analyst John DeCree puts it, Lucky Dragon is going to have to “broaden” a business plan that “caters to only one customer segment.” Given the number of creditors with claims upon the property and the unlikelihood of recouping the casino’s $143 million cost, EB-5 investors will almost surely find themselves left out in the cold. You can count out Derek Stevens as a potential rescuer. He told the Las Vegas Review-Journal was “in a pretty tough location.” (A reputed policy of sweating comps can’t have helped.)

VitalVegas tips Alex Meruelo as Lucky Dragon’s likely savior. He could certainly run it in tandem with SLS Las Vegas — likely to be renamed Grand Sahara — and exercise economies of scale. Some of the aforesaid economies have the Culinary Union all het up, as it expects Meruelo to try and oust the union from SLS. Speaking of EB-5 investors, they’ll take a haircut when Meruelo closes the SLS deal. The latest offer on the table was 20% of the resort’s equity value. Since they accuse current ownership of continuing to lose money we’ll see if Meruelo can apply a tourniquet to that bleeding stump.

* It’s a match made in Heaven, or so it appears. Diamond Jacks wants to weigh anchor and leave the Shreveport market. City officials in Monroe are looking to pull back money lost to Shreveport and Vicksburg. Solution? Bring a riverboat casino to Monroe. One of the selling points will be good jobs. “We’re talking 15 to 18 dollars an hour, people on the floor and then higher-ups make even more money,” said South Side Economic Development District Executive Director Charles Theus. However, there are several shoals to be navigated, including designation of the riverfront as a gambling area and approval by parish-wide vote. In other words, it’s a long shot at this point.