Mixed readings on Vegas recovery; Trump vs. Titus

Macquarie analyst Chad Beynon tells Komenda, “If it’s fully distributed and kids are back at school at the end of the first quarter, I think that’s when people will start to get more comfortable—when their lives are a little more normal.” That’s a big “if,” given what we are reading about patchy, slow vaccine rollouts. And vaccinating 300 million people, at minimum, is a pretty tall order for the incoming Biden administration. At least pitchman Billy Vassiliadis is confident: “There will be a boom in Vegas. In my regular life, I’ve either said it or heard it a hundred times: ‘Honey, we’ll celebrate my birthday next year when it’s OK,’ or ‘Honey, we’ll do our anniversary next year’ or ‘We’ll save up all the events we missed and have one big party.'” Already there is some vaccine-related uptick. Hotel companies like Hyatt, Marriott and Best Western are seeing their highest booking levels since the Great Shutdown in March. 9,512 bookings were made on Dec. 11 alone. That’s right amid the average number for a year previous. And, yes, Vegas was one of the most-popular destinations … and the only casino-enabled one.

Acquisitions, at least on a small scale, continue to be the rule in a pandemic-driven world. CQ Holdings has doubled down on the Baton Rouge market. After snapping up antediluvian Belle of Baton Rouge, it has moved on the operational rights to Hollywood Baton Rouge. The real estate will still be owned by Gaming & Leisure Properties and CQ will benefit from GLPI’s continuing plans to move the casino onshore. The deal will cost CQ a tidy $28 million. Given the small percentage of Baton Rouge’s gaming revenue represented by the two boats (in a market loomed over by L’Auberge Baton Rouge), we’d be pretty surprised if regulators raised antitrust objections. Last fiscal year L’Auberge won $123.5 million compared to a combined $64 million for Belle and Hollywood. Of course, revenues could increase with capital improvements and with a dual infusion of DraftKings. Even chief regulator Mike Noel allowed, “Maybe with those changes, they’ll be able to compete a little better at the two downtown casinos.” We agree.

In what may be a difference without a distinction, Penn National Gaming has purchased the operational side of Hollywood Perryville for $31 million from GLPI. The latter will still own the physical asset. Penn’s reasons for exercising this option include having a platform in Maryland from which to launch Barstool Sports. It will pay an $8 million/year lease. “With the recent approval of sports betting through the overwhelming passage of Question 2 on Election Day, Maryland is expected to soon become a significant retail and mobile sports betting market,” said Penn CEO Jay Snowden. Hollywood Perryville earns its keep but Penn is obviously banking pretty heavily on that sports-betting revenue. While one might assume a casino will have rights to offer sports betting, that’s for the General Assembly to decide. “Right now there’s a presumption that every casino will have a sportsbook operation, but we don’t know for sure,” said gaming analyst James Karmel. For instance, it might be reserved for horse tracks. Even mobile wagering can’t be assumed. It makes sense but when was the last time politics made sense?

Donald Trump‘s casinos were never known for their architecture (at least not in a good way) but, if his latest executive order stands, federal buildings from now on will have a Trumpian signature to them. That will be a pseudo-Classical style, with vague addendum that they be “beautiful.” Now, beauty is a notoriously subjective criterion, difficult to enforce (as Steve Wynn found out when he hired Philip Johnson and Frank Gehry to co-design his never-built Le Jardin). So if you see a lot of Greek colonnades and Palladian windows when you visit a federal building in the future, you can thank the auteur of Trump Taj Mahal. The idea is to create architecture that ‘commands respect’ from John Q. Public, which is kind of a chilling idea when you think about it. Already, Nevada Rep. Dina Titus (D) is pushing back, introducing legislation to preserve creative freedom. Said Titus, “Imposing a preferred architectural style for federal facilities runs counter to our nation’s democratic traditions. Attempting to implement this misguided mandate from Washington, D.C., by circumventing Congress and gutting decades of … policy and practice without any public notice or hearing is even worse.” We’re reminded of the attempts to classically retrofit Howard Roark‘s architectural designs in The Fountainhead, a mandate more comical than compelling.

Jottings: Good news for Macao casino-concession holders and bad news for anybody wanting to enter the market—the Macanese government appears likely to scrap 2022 re-bids in favor of a unilateral extension through 2025. In other news Londoner Macao is announced for a Jan. 22 opening … What do you with unlicensed casino-resort? Open it without gaming. That’s what Crown Sydney did … Interior Secretary-designate Rep. Deb Haaland (D) has tribal gaming experience. There’s another reason for optimism on that battlefront … Circa has unveiled yet another promo: a bar crawl. A pass (price unspecified) entitles you to seasonal cocktails at Vegas Vickie’s, Circa Bar, Bar Prohibition, Bar Canada and Vue Bar. Buy four passes and you get a free room night to sleep it off … Bart Blatstein‘s proposed water park at the Showboat in Atlantic City is a go—provided that the Casino Reinvestment Development Authority comes through with $2.5 million in annual tax breaks, stretched over 20 years … London casinos can’t catch a break: They’ve gone from curfew to shutdown, in response to Coronavirus mutations that Mayor Siddique Khan described as “deeply alarming.” (OTBs remain open.) This caused Caesars Entertainment to permanently pull the plug on Rendezvous Casino Southend … Ho-Chunk Inc. has established an operating company, WarHorse Gaming to run racinos in Omaha, Lincoln and Sioux City. The company’s political partner, the Nebraska Horsemen’s Benevolent & Protective Association, will be a part of WarHorse.