Icahn: My way or the highway

Posted on December 15, 2014 by David McKee

If Unite-Here doesn’t cave in today, it’s curtains for Trump Taj Mahal. Or so says Carl Icahn, who wants the union to abandon its court fight to restore health and pension benefits breached by Trump Entertainment Resorts. If Icahn carries through with his ultimatum,carl_icahn the property would be mothballed on Dec. 20. TER CEO Robert Griffin got into the act, sending another of his melodramatic missives to Local 54 President Robert McDevitt.

“Please, Bob. This is our final opportunity to help people. Time is running out and money is running short. We simply cannot stay in limbo any longer. Every day, fewer and fewer people patronize the Taj, and we lose more and more of what little money we have left,” wailed Griffin, blaming McDevitt for his own ineptitude. “We just cannot wait any longer.”

At least Griffin is Continue reading →

Posted in Atlantic City, Boyd Gaming, Carl Icahn, Dining, Entertainment, Harrah's, Louisiana, Pinnacle Entertainment, Texas, The Strip, Tilman Fertitta, Tribal, Trump Entertainment Resorts | Comments Off on Icahn: My way or the highway

Migratory patterns in Atlantic City

Posted on December 12, 2014 by David McKee

Considerably less casino revenue continues to flow into Atlantic City, down 13% last month, but it’s not all bad. Thanks to the whale-sized “market correction” of multiple casino closings, Golden Nugget ACthere continues to be more money for everybody who’s left. October’s shifts weren’t as dramatic as September’s save in the case of the Golden Nugget, which rocketed 63% upward, grossing $16 million. That shot it past Resorts Atlantic City ($12 million), which itself gained a respectable 16%, and also vaulted it past the bunglers at Trump Taj Mahal, whose $15 million betokened a 20% decline. The only other casino to lose market share was Bally’s, grossing $17 million and down 5%.

The resorts of the Caesars Entertainment portfolio performed impressively, with Continue reading →

Posted in Atlantic City, Boyd Gaming, Current, Economy, Harrah's, Mohegan Sun, Tilman Fertitta, Tropicana Entertainment, Trump Entertainment Resorts | 1 Comment

Et tu, Harry?

Posted on December 10, 2014 by David McKee

Internet gambling dodged a bullet when the federal government’s omnibus spending bill was sent to the floor without Restoring America’s Wire Act tacked on like a flea riding a harry-reiddog. “If we can’t get it into the omnibus, it won’t be in anything,” said outgoing Senate Majority Leader Harry Reid (D), whose word can presumably be taken as definitive. However, Harry is not Big Gaming’s friend on this issue: He’s been lately seen breaking bread with emissaries of Sheldon Adelson, Public Enemy Number One when online gaming is concerned.

Reid’s support for ‘Net betting has always been shallow and suspect, never extending beyond support for Web poker and wanly at that. Now he appears he’s ready to sell the whole kit ‘n caboodle down the river. To understand the significance of this, recall that almost all of Big Gaming — especially Continue reading →

Posted in Economy, Harrah's, Harry Reid, Internet gambling, Macau, MGM Mirage, Politics, Sheldon Adelson, Shuffle Master, Taxes | Comments Off on Et tu, Harry?

Stale thinking in Atlantic City; Big trouble in little Macao

Posted on December 10, 2014 by David McKee

New Jersey lawmakers, evidently oblivious to the recent spate of casino closings, have decided that what Atlantic City needs is more and smaller casinos, even though the pitfalls atlantic-cityof a casino-based economy have been amply demonstrated. They’re dusting off 2011’s dud “boutique casino” law, which found no takers — unless you count a scrapped Hard Rock International plan — and are removing some of the disincentives. No longer will small casinos have to be built from the ground up. Instead, existing buildings can be repurposed. Also, the 200-room hotel requirement will be sufficient … no longer will operators be obligated to eventually upsize to 500 rooms.

“This bill addresses a small-scale casino license, but it can help, so we should Continue reading →

Posted in Atlantic City, Economy, Glenn Straub, Hard Rock International, Macau, Regulation, Revel | 1 Comment

Cosmo: Unwin out

Posted on December 10, 2014 by David McKee

Whatever Blackstone Group plans for The Cosmopolitan of Las Vegas, it doesn’t include CEO John Unwin, who will leave at year’s end. Don’t cry for him just yet: He’ll temporarily be on a consulting contract, which conveniently keeps him for peddling his skills 714_Cosmopolitan_John_Unwin_061_RTelsewhere. In his five years at the helm, Unwin was able to create a cachet for the oddly designed resort but was never able to record a profitable quarter nor to generate significant gambling revenue until very recently. No need to worry for Unwin, though, as he leaves the Cosmo a very wealthy man.

Nor is this necessarily a good thing for the Cosmo. Unwin could at least drive revenue through everything but the casino and the place did achieve a vibe as a place to see and be seen that nearby Aria has never achieved. He will probably be replaced by private equity pencil pushers, as the blundering of clueless, cold private equity into the casino sphere has probably been the single worst development in the industry in the last 20 years. Blackstone Group’s takeover of the Cosmo is expected to close sometime in December, which leaves the fund with very little time to find a new CEO.

Unwin would say no more than,  Continue reading →

Posted in CityCenter, Cosmopolitan, Harrah's, MGM Mirage, The Strip, Wall Street | 1 Comment

Big month for Isle; Sentence handed down on Caesars gang

Posted on December 10, 2014 by David McKee

Whether it’s that one less weekend day than last year or holiday shopping or whatever, Missouri was down again in November after tantalizing us with a revenue-positive October.
River City-0-1The statewide decrease was 4%, with table revenues holding steady but slot revenues pulling the total down. A 3% greater spend per visitor couldn’t offset 7% less visitation. In the St. Louis area, Pinnacle Entertainment‘s River City (left) had an unwontedly negative month, down 7%, while its Ameristar St. Charles was only off 1%, and Penn National Gaming‘s Hollywood Casino St. Louis was down just a point more, grossing $17 million to Ameristar’s $21 million. And whatever the magic formula is for Lumiere Place, it’s not yet been unlocked by Tropicana Entertainment, which suffered a 5.5% decline along with an 11% gross.

Kansas City continues to struggle with the loss of Continue reading →

Posted in Harrah's, Harry Reid, International, Internet gambling, Isle of Capri, Kansas, Missouri, Penn National, Pinnacle Entertainment, The Strip, Tropicana Entertainment | Comments Off on Big month for Isle; Sentence handed down on Caesars gang

Indiana giveth, Ohio taketh away; Atlantic City fix finds wide support

Posted on December 9, 2014 by David McKee

Depending on whether or not you count free play as taxable revenue, Indiana was down 6% or 7% last month, with customers spending 3% more but visiting 9.5% less. Penn National AztarGaming‘s Hollywood Lawrenceburg took cross-border competition particularly hard, falling 21%, its $15 million gross still impressive but a shadow of its former days. Belterra Casino Resort felt the Cincinnati pinch too, slipping 12%. Worst off was Rising Sun, plummeting 31% to a $4 million gross. Outside the area impacted by Cincy casinos and racinos, perennially fortunate Tropicana Evansville (left) was up 13% and Horseshoe Southern Indiana was down 4%, perhaps losing players to “instant racing” terminals in Kentucky. The salaciously named French Lick resort was off 7%.

Pinnacle Entertainment enjoyed a big month up at Ameristar East Chicago, grossing $20 million and improving 13%, while all Continue reading →

Posted in Atlantic City, Boyd Gaming, Current, Harrah's, Indiana, Kentucky, Ohio, Penn National, Pinnacle Entertainment, Politics, Sheldon Adelson, Taxes, Tropicana Entertainment | 1 Comment

Quote of the Day

Posted on December 8, 2014 by David McKee

Foxwoods logo“That is going to be a pretty difficult pivot. Just because you have good amenities doesn’t mean people are going to be willing to drive two to three hours to get there.” — Fitch Ratings analyst Alex Bumazhny on Foxwoods Resort Casino‘s $1.7 billion and CEO Felix Rappaport‘s rebranding strategy.

Posted in Foxwoods, Tribal, Wall Street | 1 Comment

The war over Caesars

Posted on December 8, 2014 by David McKee

That Caesars Entertainment plan to subdivide itself into a REIT may be a one-week wonder: Creditors are reported to be balking at the structure. “The creditors want to make sure the REIT is structured in a way that protects them as the unit’s new caesarscasino_1owners, the people said,” to the Wall Street Journal. They may be concerned that being under the operating-company half of the REIT, which would leave them at the mercy of Gary Loveman, David Bonderman and Leon Black, the Three Horsemen of the Apocalypse. “Some senior creditors are concerned that Caesars would have outsize leverage in managing the properties within the REIT in a way that could affect its profitability, according to people familiar with the talks,” reports the WSJ.

Creditors are asking for guarantees of lease income, which could easily become a sticking point. The longer the disagreement drags out, the closer Caesars gets to Continue reading →

Posted in Atlantic City, Delaware, Harrah's, Internet gambling, New York, South Korea, Station Casinos, Trump Entertainment Resorts, Wall Street | 1 Comment

Illinois disappoints, Ohio surprises and Golden Nugget opens early

Posted on December 8, 2014 by David McKee

Except for a mild, 2% increase at Harrah’s Joliet, it was a very schizoid November for Illinois, whose casinos came in 4% below last year. There was one less HarrahsJolietweekend day, which some will cite as an alibi … but then how does one explain the 17% upsurge at Harrah’s Metropolis or the 4% increase at Rivers Casino? Metropolis did almost as well in dollars grossed as GLPI‘s Casino Queen in East St. Louis, which spiraled 17% downwards. Others who suffered heavily were Argosy Alton (-14%), Boyd Gaming‘s Par-A-Dice (-12%) and MGM Resort International‘s Grand Victoria (13%). Lesser declines were posted by Jumer’s Casino Rock Island (-5%) and Empress Joliet (-7%).

A couple of states over, in Ohio, the proliferation of racinos contributed to a 30% growth in gambling revenue for November. The first thing one notices is Continue reading →

Posted in Boyd Gaming, Genting, GLPI, Hard Rock International, Harrah's, Illinois, Louisiana, MGM Mirage, MTR Gaming, Neil Bluhm, New York, Ohio, Penn National, Pinnacle Entertainment, Racinos, Tilman Fertitta | 1 Comment

The war on Dotty’s; Ultimatum in Macao

Posted on December 8, 2014 by David McKee

In the wake of the Dotty’s brouhaha, I find myself wondering how this got to be such a big issue. After all, Nevada Restaurant Services had been buying up defunct bars Dottys.jpgand store fronts by the score and converting them to Dotty’s with no interference from the Nevada Gaming Control Board or the Nevada Gaming Commission. Only the solons at the Clark County Commission seemed to find Dotty’s a threat to the common good. As Las Vegas Review-Journal columnist Steve Sebelius put it …

It’s really too bad for the Clark County Commission that they simply couldn’t pass an ordinance that says, “All Dotty’s must close immediately!”

Sebelius also revealed that Station Casinos tried to buy Dotty’s in 2013 and was Continue reading →

Posted in California, Dotty's, Economy, Internet gambling, Macau, PokerStars, Regulation, Station Casinos, Tribal | 1 Comment

Trump Taj Mahal buys time

Posted on December 5, 2014 by David McKee

Taj MahalIn the latest of many deadlines, Trump Taj Mahal has pushed its closing date back by another week, from Dec. 12 to Dec. 20. (Given that it has closed one of its hotel towers, we should not be surprised that the Taj is cutting back on workers’ hours.) It’s also still cadging for tax breaks from New Jersey, despite several strong indications that the state has no appetite for bailing out a casino. By winding down its arrangements with Betfair and Ultimate Gaming, the Taj will have access to an extra $1.4 million. That money buys it another week. Betfair has since moved its online-casino games to the Golden Nugget‘s Web site. As for Betfair’s poker site, it no longer exists. Toward the end, its “rake” was literally next to nothing, literally nothing in October.

* After much pre-trial bluster, most of the defendants in Continue reading →

Posted in Atlantic City, Harrah's, Internet gambling, Sports, Station Casinos, Taxes, The Strip, Trump Entertainment Resorts | Comments Off on Trump Taj Mahal buys time

Player, manage thyself (sorta)

Posted on December 5, 2014 by David McKee

After much back-and-forth, the Massachusetts Gaming Commission imposed its highly touted “managed play” regime, the first in the nation. One’s first reaction is that Slot playerit doesn’t live up to the advance hype. What was originally a carrot-and-stick plan is now no carrot and very little stick. There will be no free play for gamblers who stay within their pre-set limits and, once those limits have been exceeded, there will no longer be warning messages every 15 minutes. A 24-hour “cooling off” period for players attempting to raise their limit was also nixed. Instead, the reminders will come when John Q. Gambler hits 150% of his limit, then 200% and so on. “It’s important to provide them with the kind of information that will allow them to make an informed decision,” said Director of Research & Problem Gambling Mark Vander Linden.

The policy will be implemented at Penn National Gaming‘s racino as a test measure before being engraved in stone, which may not happen until Continue reading →

Posted in Colorado, Economy, Massachusetts, Penn National, Problem gambling, Regulation, Steve Wynn, Taxes | Comments Off on Player, manage thyself (sorta)

Quote of the Day

Posted on December 4, 2014 by David McKee

IMG-20130507-00006“For Caesars [Entertainment], the problem creating so many subsidiaries is that debt holders who financed the company were intentionally cut out from the valuable assets as they were transferred to new companies. This would be like getting a mortgage to buy a home and then jacking up the home and moving to new land, leaving the bank with no collateral but the land where a house once sat.” — Motley Fool analyst Travis Hoium on the asset-shuffling that is at the heart of a dispute between Caesars and some of its main creditors.

Posted in Harrah's, Wall Street | 1 Comment

Dotty’s loses, Genting hesitates, Penn adapts

Posted on December 4, 2014 by David McKee

Look at that picture. Seriously, keep looking. Does that seem like a tavern to you? A casino? Some curious hybrid? For years the Clark County Commission has been grappling with the vexing Giunchiglianiquestions posed by the rapidly growing Dotty’s chain of slot parlors. With only Commissioner Chris Giunchigliani (left) dissenting, the board voted to require slot parlors (read: Dotty’s) to install full kitchens, pronto, or face the wrath of the law. (Giunchigliani favored giving them a six-month phase-in period.) Although it’ll cost his company $10 million, Dotty’s COO Mike Eide was stoic: “We’ll adapt.”

Under the new regulation, “incidental” gaming revenue has to be less than 50% of total revenues. Slot parlors that exceed that threshold will have to cut down from 15 machines to seven. Compliant, post-2011 parlors won’t be affected, neither will non-compliant ones that predate 2006. So it’s largely a win for Golden Gaming and Station Casinos, with a bone or two flung Dotty’s way.

* Genting Group continues waffling on Resorts World Las Vegas, in part due Continue reading →

Posted in Architecture, Cordish Co., Dotty's, Downtown, Genting, Golden Gaming, Harrah's, Maryland, New York, Pennsylvania, Regulation, Station Casinos, The Strip | 2 Comments

Cokehead gets Nevada casino license; Cosmo sale near

Posted on December 4, 2014 by David McKee

Goodwill generated by the opening of SLS Las Vegas just went up Sam Nazarian‘s nose. The Los Angeles nightclub operator admitted to doing cocaine last April while living it snazup in Mexico. This is the kind of revelation casino pundits have been dreading, should Nazarian ever apply for a gaming license, which he has finally done. Much more concerning, however, is the revelation that Smilin’ Sammy Naz let himself be shaken down for over $2 billion by convicted felon Derrick Armstrong. He also laid $90,000 on Suge Knight and $83,000 on Hai Waknine, both of whom have been sent to the slammer.

And there may be others. “This isn’t the first time I’ve had to deal with this kind of parasite,” said Nazarian attorney Joseph Taylor. Another Nazarian consigliere, Anthony Cabot, argued that the incidents should be ignored in light of his business expertise. That’d be a bit like saying Allen R. Glick‘s relationship with Lefty Rosenthal should have Continue reading →

Posted in Cosmopolitan, Harrah's, history, Macau, Regulation, Sam Nazarian, Sheldon Adelson, Steve Wynn, The Strip | 1 Comment

Saving Atlantic City; Smokeless in Iowa

Posted on December 4, 2014 by David McKee

In an effort to solve the problem otherwise known as Atlantic City, policymakers are floating a variety of remedies. One would see the city’s casinos make a lump sum atlantic-citypayment of $150 million for two years, in lieu of property taxes. If Boardwalk gaming revenue stays between $2.2 billion and $2.6 billion, the lump sum is then reduced to $120 million. If the bottom falls out of the market and casino revenue dips below $1.4 billion, the lump-sum payment then goes down to $75 million. Mayor Don Guardian is keeping current property-tax numbers under wraps, so it’s impossible to say how this compares to what casinos are currently paying the city. Unfortunately for people who live in Atlantic City, they have to make up for every reduction in casino property taxes.

Funds intended for redevelopment would also be rechanneled into retiring the city’s debt. Similar versions of this overall scheme have been put forward by Continue reading →

Posted in Atlantic City, Boyd Gaming, Environment, Harrah's, Iowa, Isle of Capri, Pinnacle Entertainment, Regulation, Taxes | 1 Comment

Chronicle of a bankruptcy, foretold

Posted on December 3, 2014 by David McKee

Dipping into Shakespeare, Howard Stutz endeavors to do justice to the Elizabethan complexity of the Caesars Entertainment bankruptcy. The fault is not in the stars
but in Gary Loveman, architect of the disaster. When it was rolled out, back in 2007, when Las Vegas was still going strong, the leveraged buyout looked like the second-longest of long shots (second only to Station Casinos‘ LBO). In order to work, two things had to happen: The economy had to keep improving and gambling revenue had to keep going up. It was a plan which made no contingency for adversity. Then-Harrah’s Entertainment was expected to grow, service its debt and pay it down. Well, one out of three still isn’t good.

(It was a bad sign when analysts were talking about asset sales before Continue reading →

Posted in Atlantic City, Fontainebleau, Genting, Hard Rock International, Harrah's, International, Macau, New York, Pennsylvania, Singapore, Station Casinos, The Strip, Tribal, Wall Street, Wisconsin | 2 Comments

Walk softly, carry a Talking Stick

Posted on December 3, 2014 by David McKee

There’s a new symbolic benchmark for the economic importance of tribal gaming in the U.S. What was the US Airways Center, in Phoenix, home of the Phoenix Suns, is becoming Talking Stick Resort Arena. It’s a testimony to the financial clout of the Salt River Pima-Maricopa Indian Community and of “the new buffalo.” The tribe hopes to generate additional business at Talking Stick Cultural & Entertainment Destination, which isn’t just home to a casino but a golf course and baseball stadium, and the new name of the basketball stadium will be everywhere from business cards to the roof. Although the change will Continue reading →

Posted in Arizona, Dotty's, Entertainment, Golden Gaming, Politics, Regulation, Station Casinos, Tribal | 1 Comment

Death throes at Trump Taj; Casino clash in Maine

Posted on December 2, 2014 by David McKee

trump-taj mahaEven with a $5 million cash infusion from rich uncle Carl Icahn, that didn’t stop Trump Taj Mahal from going into Death Spiral Mode. Its greatest asset, its new(ish) hotel tower, has been closed and the casino will no longer issue you credit. Already Trump Entertainment Resorts has petitioned the State of New Jersey for permission to shut down altogether. It’s not clear whether these or serious measures or more scare tactics from upper management, to try and bring Local 54 of Unite-Here into line. Judging from the string of melodramatic pronouncements made by Trump CEO Robert Griffin, I’m going with Door #2.

* Research done by Maine‘s Legislature’s Veterans & Legal Affairs Committee shows that the state could sustain two additional casinos, at the extreme northern and southern ends of the state. But Continue reading →

Posted in Atlantic City, GTECH, Horseracing, IGT, International, Lawrence Ho, Maine, Melco Crown Entertainment, Penn National, Politics, Tribal, Trump Entertainment Resorts | Comments Off on Death throes at Trump Taj; Casino clash in Maine