Decline of the Golden Nugget?; Bluhm gets Chicago boost

On March 7, our Atlantic City correspondent wrote to us, “Who took the slot machines since yesterday? They even got rid of two of the four “vanity’ Tilman Fertitta dollar Billionaire Buyer machines. (I never saw anyone at those machines). It was lightly attended as the next photo indicates.” (Borgata, by contrast, was “very busy.”)

Here is the Chairman’s Lounge at 10:30 p.m. on a Friday, looking pretty sparse …

And the situation in the valet-parking area pretty much speaks for itself. Tilman, look to thy laurels!

Indiana casinos catapulted 48.5% over 2021 last month, as they grossed $201 million and picked up the pace from January. (The result was also a 17% bump over the same period in 2019.) Hard Rock Northern Indiana held the lead with $31.5 million, edging Horseshoe Hammond with its $29 million (+16%). Ameristar East Chicago posted $18 million, up 17.5%, and Blue Chip gained 43% to $11 million. No one was revenue-negative, even casinos which dipped last month. French Lick Resort recorded $6 million (+26%) and Belterra Resort notched $7 million (+26.5%). Racinos fairly galloped, with Indiana Grand up 39% to $27.5 million and Harrah’s Hoosier Downs leaping 40.5% to $19.5 million. Caesars Southern Indiana vaulted 42% to $19.5 million, Hollywood Lawrenceburg jumped 40% to $15 million and Rising Star rose 28% to $4 million. Rocketing off a rebrand, Bally’s Evansville shot 69% upward to $14 million, closing out an auspicious month.

Sports betting yielded revenue of $22 million on handle of $409 million. (Very low hold didn’t help.) As far as online sports betting is concerned, DraftKings‘ 32% bested FanDuel‘s 28%, with BetMGM in there swinging with 14%, followed closely by Caesars Sportsbook‘s 12%. Also-rans included BetRivers, PointsBet and Barstool Sports, all at or near 4%. Roadkill included going-out-of-business Twin Spires and WynnBet, as well as Unibet and Betway, which are dead but don’t know it yet.

Detroit‘s casinos banked $95 million last month, with the bulk of the revenue going to MGM Grand Detroit (49% of market share), followed as usual by MotorCity (30%) and Greektown Casino (21%). MGM gained 34.5% from last year, but the others lost ground, with MotorCity was down 7% and 2% at Greektown. But despite $25 million in handle, all three lost money on sports betting.

Convenience is overriding competition in the New York State Lege, as it looks to expedite casino licensing in New York City. The proposed beneficiaries are MGM Empire City and Resorts World New York, both of which offer VLTs instead of slots and table games. “We’re looking more toward conversion: if you can convert an existing facility to a full-fledged casino, then that would be acceptable,” said Assemblyman Gary Pretlow (D, above), the godfather of gambling in the Empire State. The argument makes a fair amount of sense. If you want Las Vegas-style gambling ASAP, why not go with the two closest equivalents? “The former governor didn’t like that,” said Pretlow, alluding to disgraced Andrew Cuomo. “Hopefully, this governor does. So if we can do a conversion, then it’s a slam dunk for Genting and MGM.”

There are still three hurdles. One is a review process, which MGM Resorts International and Genting Group would surely ace. Another is the third and final license, which has multiple interested parties. And where would that last license go? Manhattan has virtually been declared off-limits and Brooklyn is getting its back up. Staten Island has been mooted, as has Flushing. Pretlow is guardedly pessimistic: “I honestly don’t see a location that a third license would go. And if one was awarded, it’s at least three years down the road” from opening. MGM and Genting have powerful legislators in their corners. Las Vegas Sands, Bally’s Corp. and others … not so much. Considering the $500 million upfront fee, plus a multi-billion-dollar investment, New York City is not going to be a market for the faint of heart, however lucrative it may prove to be.

Neil Bluhm‘s McCormick Place casino proposal got a boost from Chicago‘s Friends of the Parks, who deemed it the most environmentally friendly of the five casino proposals on the table for the Windy City. Its opinion wasn’t uninfluenced by the fact that only Bluhm had made contact with Friends of the Parks, seeking its favor. “As we’ve consistently advocated for, the current proposal imagines greening in the parking area that returns more than five acres of asphalt parking lots to public parkland,” Executive Director Juanita Irizarry wrote to supporters. The Bluhm pitch includes converting the roof of McCormick Place to green space, too, which also pleased Irizarry.

If Chicago officials are looking for a casino sooner rather than later, Bluhm’s is the obvious choice. If they want heavy investment, well maybe not. The McCormick Place conversion would cost ‘only $1.3 billion, which we think sensible in Illinois’ high-tax climate, which scared off MGM and Wynn Resorts. The Bluhm proposal would put a casino closer and more convenient to the existing convention center than any other … too close for the comfort of the convention trade, who fear attendees will be lured from the exhibit floor to the slots instead. A competing Bally’s proposal covets McCormick Place’s truck marshaling yards, to the displeasure of convention center CEO Larita Clark, who told reporters, “In 2019, 35,000 trucks used the marshaling yards and their proximity to our campus is a competitive advantage.”

Hard Rock International is getting into the McCormick Place act, saying that either of two of its halls would be used as a temporary gambling hall while a grand, multi-billion-dollar Hard Rock is built at a discrete location further north. Friends of the Parks favors any solution that “reuses a significant historic building. We believe reusing an existing building and surrounding infrastructure is the most environmentally sustainable choice to reduce carbon emissions.” May the greenest proposal win.

Jottings: Yesterday’s Light & Wonder road show was long on self-promotion but rather short on substance … Should companies “be allocating assets to countries like Taiwan that promote freedom and peace” instead of China which tends to “carpet-bomb” its most profitable industries? Investment analyst Perth Tolle argues in favor of investing in democracy … According to New Jersey Gov. Phil Murphy‘s office, casino tax “collections continue to exceed projections” and are “rising above prepandemic levels.” So remind us please why Atlantic City casinos need smoking … It took 10 years and $400 million but Monarch Casinos‘ new, 516-room hotel in Black Hawk is ready to open. “Customers that would have normally gone to Las Vegas or other venues would stay here at home,” predicts City Manager Stephen Cole … Having moved away from the county jail, Queen of Terre Haute is targeting a May start of construction, according to owner Churchill Downs. The $260 million projected is slated to open next year … If you go 63-for-63 in your March Madness picks, Bally’s Corp. will award you $100 million, provided you bet with them. The “Bally Bracket” is free to play, the latest gimmick in customer-acquisition strategies. The company says it’s not taking a risk: “If we treated the odds for each game as a coin flip, that makes the odds of picking all 63 games correctly 1 in 9.2 quintillion.” Nothing to it.

Quote of the Day: “I will either find a way or make one.”—Hannibal