Showing something less than his usual decisiveness, Sheldon Adelson continues to send mixed signals with regard to his intentions in his native Massachusetts. He’s re-upped with Boston-based lobbyist firm Donoghue Barrett & Singal. However, despite years of scouting the market, Las Vegas Sands says it is still “considering locations.” The Boston Herald draws a strong contrast between Sands’ indecision and the growing number of casino contenders who have settled upon hard and firm locations. Of course, that’s still a matter for local voters. Secretary of State William Galvin is trying to paper over a gap in state laws, in order to apply closer scrutiny — but not donation restrictions — to pro- and anti-casino campaigns. It was rather careless of lawmakers to permit a loophole the size of a locomotive, so the onus is open them to create transparency.
Happy New Year, Macao. Of course, it’s not the new year yet over there but Macanese casinos closed out 2011 with another 25% upsurge. And that was a poor month for casinos, given that luck was on players’ side in December. Since Big Gaming gets all pissy if you make market-share comparisons in Macao, we won’t. However, it was interesting to see J.P. Morgan analysts downplay fluctuations therein as reflective of low hold — when the interesting thing about the market-share comparisons was how little fluctuation there actually was. Not that it means anything … right, Steve?
I suppose 25% growth is disappointing when you’re averaging 42%, in a market where 95% of all revenue comes straight from the casino floor. If December’s numbers are the leading edge of a cool-down in casino play (Wall Street thinks otherwise), that’s cause for concern. But any worries should be tempered by the knowledge that Macao is coming off a $33.5 billion year in gambling revenue, numbers that make the Las Vegas Strip pale by comparison. The handwriting was on this particular wall at least as far back as 2005, when all the numbers pointed toward tectonic shift in the gaming universe.
“Same Fame, New Name.” Actually, “fame” isn’t the noun one associates with the ex-Las Vegas Hilton, now formally the “Las Vegas Hotel & Casino.” (One tends to think of terms like “insolvency” and “foreclosure” nowadays when the LVH is mentioned.) The modest upside is that Colony Capital has, for the moment, agreed to surrender casino operations to receiver Ronald P. Johnson. “Modest upside” = too little, too late. Had Johnson been in position months earlier, this whole Hilton debacle might have been avoided, but Goldman Sachs tarried rather too long before trying to push Colony’s bunglers executives out the door.
Bend in the river? “Boats in moats,” a longtime albatross around the casino industry’s neck is a paradigm that may finally be on its way out. Iowa is taking the lead and Penn National Gaming wants to be part of the evolutionary movement onto dry land. It estimates it can make at 15% more in casino revenue if its Argosy Sioux City riverboat were converted into a land-based facility. Penn’s projected $100 million budget looks awfully low for such a project, especially one that involves going from 21,000 square feet of casino floor to 50,000.
Penn’s also cutting it a bit fine concerning its lease on the riverboat, which expires in July (according to Penn) or in a year, if you believe its partner, Missouri River Historical Development. Penn left a six-month extension, one which would have rendered the issue moot, on the table. Precipitating a crisis in this manner may give Penn the leverage it needs with the state to obtain an onshore casino. However, MRHD has announced its intention to flirt with other potential spouses (Caesars Entertainment anyone?), showing that two can play this game.
