Biloxi: Isle out, Landry’s in; Grind joints come to Atlantic City

Not even a rocky start in Atlantic City has cooled the ardor of Landry’s Restaurant CEO Tilman Fertitta for new casino acquisitions. Earlier today Landry’s announced that it had bought Isle Casino Hotel, putting Fertitta into the Biloxi market. The colorful executive is promising a large-scale, year-long reinvention of the property (probably well overdue), which will include adding many of the F&B brands already familiar from his Golden Nugget in downtown Las Vegas. While the rumored, $45 million purchase price may look as though Isle Biloxi — the market’s oldest casino — went for cheap, Deutsche Bank‘s Carlo Santarelli pegs the cost at nearly 9X cash flow for 2011 … well above industry average.

Faced with Landry’s aggressive offer (more, in strictly EBITDA-multiple terms, more than Boyd Gaming forked over in its $278 million purchase the nearby Imperial Palace), one can’t blame Isle CEO Virginia McDowell (right) for taking the money and running from Biloxi. While it seems counter-intuitive to bail on the Gulf Coast, Santarelli forecast that the sale would “be well received by investors” and that Biloxi was a “tough and highly competitive” place to do business … especially if you have a superannuated facility, I might add. Meanwhile, Isle GM Doug Shipley has been sent out to walk the casino floor and calm the workforce. If they’re apprehensive, it’s with good reason: Fertitta had a reputation for running a tight and unhappy ship during his early years in Downtown.

ACH-out! That oh-so-catchy “ACH” brand didn’t last long at Colony Capital‘s flagship property, soon to become the Atlantic Club. Where monthly revenues are concerned, Colony’s casino is the lowest of the low. Ergo its new, grind-joint marketing plan, which pretty much speaks for itself. (Although, given the higher hold percentages associated with penny denominations, one questions the wisdom of going with 70% penny slots if extending time on device is your goal.) As Boardwalk veteran Michael Pollock points out, the ACH-lantic Club hasn’t much choice “because the status quo is not an option.”

Unlike certain of his rivals, Steve Wynn seems very serious — uncommonly so — about getting into Massachusetts‘ newborn casino industry. Faced with a recalcitrant Foxboro electorate, El Steve is sparing no expense to assure them that his $1 billion resort project won’t be a thumb in their eye. Unlike previous feints toward Singapore and Philadelphia, this is one case where Wynn isn’t taking “no” for an answer.