JP Morgan‘s Daniel Politzer expects Churchill Downs to be a winner thrice over in Illinois: first, a lower tax rate on table games, starting in 2020; second, a potential 800 additional gaming positions at Rivers Casino Des Plaines 
(which will probably require physical expansion: it’s pretty packed in there); third, slots at Arlington Park, though Politzer thinks Churchill Downs may sell the latter now its real estate is more valuable, among several other options: “we could envision a scenario whereby CHDN would opt to sell its 336 acres of land at Arlington Park, utilize a 1031 exchange to limit tax leakage, and pursue an additional casino license in Illinois (potentially with Rush Street Gaming/Neil Bluhm; the Waukegan license seems most logical, in our view …).”
Since Arlington and Rivers are only 15 minutes apart, Churchill Downs might look askance at the obvious cannibalization. Arlington’s capacity will also be capped at 1,200 gaming positions, unlike Waukegan. Rivers can also absorb a nearby competitor, as its per-position numbers are out of sight, the most impressive I’ve ever seen in gaming: $800/win/slot/day and $7,300/win/table/day. Politzer estimates that the tax cut will translate into $45 million extra a year in cash flow, too. Churchill Downs bought 61% of Rivers at a well-above-average 11.25X cash flow, but one easily see why it was worth it. With the tax cut, that multiple goes down to 8.3X, closer to industry average. That number could go yet lower still if Rivers maxes out its gaming positions.
As for competition from the 4,000-position mega-casino in Chicago, “We acknowledge concern that a Chicago casino could be a negative for Rivers/Waukegan, but see potential for the political stars to once again align and the casino (if even feasible at the proposed 67% tax rate) being located on Chicago’s south side.” Yep, you can never count out local politics when dealing with a casino in the Second City.
* Not content to rest on its laurels, Encore Boston Harbor will be this summer’s hospitality provider at Saratoga Race Course, in upstate New York. Encore is next door to Suffolk Downs but that course went hooves-up on June 30. In addition to operating the upscale 1863 Club, Encore will sponsor two 
races this summer. The deal didn’t sit well with Assemblyman Angelo Santabarbara, who balked at the idea of bringing in an out-of-state casino as a sponsor. “I’m very protective of [Rivers Casino & Resort, in Schenectady], as you know, so when I hear something like that a red flag goes up.” Despite the four-hour drive from Everett to Saratoga, Encore prexy Robert DeSalvio said “There is a natural synergy between Encore Boston Harbor and Saratoga Race Course making this alignment a perfect partnership. As a racing fan, I am personally excited to have the opportunity to bring Wynn Resorts‘ world-renowned hospitality to the brand new 1863 Club and showcase to Saratoga visitors what we are offering in greater Boston.” Once they’ve seen Boston, how are you going to keep them down in Schenectady, huh?
* We don’t normally pimp casino promotions but the El Cortez Hotel & Casino has come up with something pretty special, its “Vintage Vegas Experience.” Book the Jackie Gaughan Suite for two nights and you get not only a pair of free passes to the Mob Museum (enough to fill an entire day of sightseeing). The latter comes with substantial bonuses that include sessions in the Crime Lab and Firearm Training Simulator, free access to the speakeasy with a $100 F&B 
credit and—the cherry on the sundae—a tour guided by museum content director Geoff Schumacher, a true Las Vegas authority. Not that the Gaughan suite is chopped liver: It is described as “Original décor includes pink
upholstered walls and floors, brass built-ins, hand-carved wooden double doors with brass door pulls in the shape of ‘J’ and ‘G’ and a pink marbled tub with gold swan features. Situated on the 15th floor, the suite encompasses 2,700 square feet, two bedrooms, 2.5 bathrooms, one romper room, a full kitchen and a spacious living and dining area.” OK, the whole experience will set you back $2,550 but I’m sure it’s something you will never forget. I’d take it over the Las Vegas Strip any day.
* With slot handle of $93.5 million in just eight days, do you think Wynn Resorts is glad it didn’t sell Encore Boston Harbor? Even so, President Robert DeSalvio seemed to imply that nearly $17 million in revenue constituted underperformance: “I will tell you that it takes a while to ramp up and build these properties up to full potential — you have to build a database — so for us, there’s an expectation that it doesn’t come automatically but it will come over time.” Meanwhile, MGM Springfield will have to come up with an explanation for its second-worst month ever, in June no less. Blaming Encore won’t cut it because Springfield was open four weeks, Encore only one.
