Jilted in Iowa

Posted on April 18, 2014 by David McKee

Cedar Rapids Mayor Ron Corbett is feeling like a swain who got stood up by his best girl. After the Iowa Racing & Gaming Commission voted 4-1 against Cedar Crossing Casino, Corbett made a speedy exit from the room and was still stung several hours later: “We felt all along that they were encouraging us. Now we have a little bit of a feeling that we were misled.”

roncorbett470Corbett has a valid point to feel led on and perhaps falsely encouraged by the two-year application process. But the IRGC has the at least equally valid point that it has to be guided by what its market studies tell it — and the tale they told of Cedar Crossing was one of severe cannibalization. Heck, Cedar Crossing conceded as much by offering to share revenue with Riverside Casino & Golf Resort, but the latter’s CEO, Dan Kehl, wasn’t having any of it. It was spinach and to hell with it.

Kehl also  had some good advice for Cedar Crossing’s backers: Continue reading →

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Much ado about Massachusetts

Posted on April 18, 2014 by David McKee

CrosbyStephen Crosby, phlegmatic chairman of the Massachusetts Gaming Commission, makes a very unlikely looking lightning rod. But such he has become. He’s already drawn the wrath of Gary Loveman and now Boston Mayor Martin J. Walsh wants Crosby to recuse himself from all Beantown-related matters. According to Walsh, Crosby isn’t just prejudiced, he’s anti-Boston. “Taken together, the pending federal lawsuit [by Loveman], recent commission statements, current press articles, and the commissions’ own actions, create a cloud over the proceedings when Chairman Crosby participates,” wrote Elizabeth Dello Russo, Walsh’s lawyer.

martinjwalsh-headshotDello Russo also launched a preemptive strike at the commission’s forthcoming hearing on Boston’s eligibility to be a “host community.” “The Commission proposes no process for the City to obtain discovery from the applicants. It eliminates the City’s opportunity to call witnesses, to cross-examine witnesses and to create an appropriate evidentiary record that is subject to legal review,” Dello Russo vituperated. “It also fails to address the burden of proof and a mechanism to resolve factual disputes based on documentary submissions with no live testimony. In sum, the proposed procedure represents a thinly veiled attempt to ‘stack the deck’ against the City on the ‘host community’ issue …”

Walsh is himself playing a dangerous game. He’s got a bird in the hand (surrounding-community status) but wants the two in the bush. Walsh can’t be so clueless as to know that putting the Wynn Resorts and Mohegan Sun proposals up to votes in Charlestown and East Boston, respectively, will surely Continue reading →

Posted in Architecture, Atlantic City, Boyd Gaming, Foxwoods, Harrah's, Massachusetts, MGM Mirage, Mohegan Sun, Neil Bluhm, New York, Racinos, Regulation, Steve Wynn, Technology, Tribal | Comments Off on Much ado about Massachusetts

Penn, Cordish kiss and make up

Posted on April 17, 2014 by David McKee

Ann ArundelRemember when Cordish Gaming and Penn National Gaming were bitter rivals in Maryland (left) and more-cordial ones in Massachusetts? Well, that’s all so yesterday as the two are teaming up to get in on the New York State market. They’ve identified South Blooming Grove, in Orange County, as their site. It’s just off I-87, the major artery between the Five Boroughs and the Canadian border, which would put them closer to New York than any other applicant. No details are available other than it’s a $750 million, 120-acre project. Perhaps Blooming Grove residents will get the skinny when Penn and Cordish present their brainchild at a town meeting tonight.

They’re not stopping there, either. The two companies are also talking about partnering on a penn-national-gamingHollywood-branded casino in the Albany area. (Whether the state will give two out of four casino licenses to the same operator remains very much to be seen.) Right now, Continue reading →

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Double whammy in Iowa; Desperation in Illinois

Posted on April 17, 2014 by David McKee

Iowa casino regulators took a strong stand in favor of the status quo, after playing it so cool they had expansion advocates fooled. Following the guidance of their own studies, they shot down the Cedar Crossing Casino project, citing its adverse economic impact on other Cedar Crossingcasinos in the area. Dissenting commissioner Dolores Mertz called for a “market-driven” casino industry in the Hawkeye State: “As a farmer, if I really believe that in agriculture, I’d be really remiss not to do that in gaming.” If they’re going to go to Nevada-style survival-of-the-fittest mode, they’ll need to go to a new process and set of criteria for approving casinos. As it is, the Iowa Racing & Gaming Commission is charged with preserving the financial health of the industry and Cedar Crossing didn’t pass that test.

“Beyond dismayed.” That’s how Penn National Gaming expressed its reaction to the denial of its Argosy Sioux City supplication. Penn was appealing Continue reading →

Posted in Atlantic City, Harrah's, Illinois, Penn National, Regulation, Taxes, Warner Gaming | 2 Comments

MGM’s sudden change of heart

Posted on April 17, 2014 by David McKee

MGM Springfield detailWell that’s torn it. MGM Resorts International has gone from being a shoo-in for a Massachusetts casino license to asking the state to delay its decision. That means Massachusetts is short some $200 million (including an $85 million licensing fee). Why? Because MGM wisely doesn’t want to pay for a license of which it could be stripped in a referendum. Right now, it’s in the hands of the state Supreme Judicial Court, which will decide whether a casino-repeal measure goes onto the ballot. And if it does, the uncertainty extends into November.

That means no construction work in Springfield and no mitigation payments to the city and its neighbors. The do-gooder brigade has really scored an own-goal on Springfield with its holier-than-thou crusade. If they win, Springfield can kiss $800 million worth of MGM investment goodbye. The company is being Continue reading →

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Las Vegas, Wranglers both grounded

Posted on April 16, 2014 by David McKee

fremont-street-experienceReports of Las Vegas‘ rebirth have been greatly exaggerated … or so the Brookings Institute‘s Mountain Monitor tells us. True, job growth was second only to Phoenix‘s, at almost 1% and double the regional average. Most of that growth, however, seems to have been in low-productivity jobs (casino industry to the white courtesy phone, please). “Putting those together, you get a view of a region focused on relatively less productive jobs. You have decent job growth, but it’s not yielding the kinds of output gains that growth is yielding in other places,” report author Mark Muro told the Las Vegas Review-Journal.

He added that, while higher employment is Job One, economic diversification is ultimately necessary to improve the region’s sluggish economic recovery. We still lead major U.S. cities in Continue reading →

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Self-delusion in Illinois; Grave-robbing at Penn project

Posted on April 16, 2014 by David McKee

Robert RitaThat’s a nice pair of rose-colored glasses that state Rep. Robert Rita (D) must be wearing. He says a 10,000-position Chicago megaresort will “capture the revenue in the Chicago market without creating the cannibalization and oversaturation.” In case he hasn’t noticed, there’s already cannibalization and oversaturation happening in the Illinois market, with Rivers Casino the main beneficiary. Downstate lawmakers are, understandably, less than enchanted with Rita’s bill draft. “I would suggest that downstate taking the leftover crumbs from Chicago is a laughable assertion that no downstater would bite on,” was the rejoinder of state Rep. Chad Hays (R).

The horsey set, meanwhile, bridles at an alternative Rita bill which would allow an unspecified number of racinos but curb their slot machine inventory (outside of Cook County) to 450 each. Rita’s Plan B also calls for a 4,000-position Chicago casino, plus one in an undetermined suburb, one in Rockford, one in Danville and one in Lake County, each with 1,200 gaming positions. One shudders to Continue reading →

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Wynn Boston: Solution or overreach?

Posted on April 16, 2014 by David McKee

Wynn EverettSteve Wynn‘s attempts to buy a former Monsanto chemical plant in Everett have been stymied by the antics of the sleazy characters who own the land. First, there was convicted felon Charles Lightbody, whose hidden ownership had to vacated (saving Wynn a lot of money, as the parcel’s price dropped to $35 million). Then co-owner Anthony Gattineri lawyered up, raising questions of whether Lightbody was still involved, especially when Gattineri refused to sign a pledge disavowing any secret partnerships. (The guy, frankly, stinks to high heaven.) “We only know what we hear, and what we hear we don’t trust,” said City Council President Michael Marchese.

Everett Mayor Carlo DeMaria now proposes to cut this Gordian Knot by using the city’s eminent domain powers to buy the land and seven adjacent parcels — 55 acres — for $41 million, then re-sell it to Wynn at Continue reading →

Posted in Economy, Foxwoods, Iowa, Massachusetts, Mohegan Sun, New York, Penn National, Regulation, Steve Wynn | 1 Comment

Cosmo: The right amount of money; MGM learns Arabic

Posted on April 16, 2014 by David McKee

Cosmo 1978A camel is a horse designed by a committee, the saying goes, and The Cosmopolitan of Las Vegas resembles nothing so much as a camel — and Deutsche Bank executives are accused of dabbling in its design. If Bloomberg News‘ sources are correct, Deutsche Bank has tired of The Cosmo and is taking its dromedary to the bazaar. The bank would endure a severe haircut on the resale, marking The Cosmo down to $2 billion or maybe even $1.5 billion. That will only begin to cover a $3.5 billion loan that Deutsche Bank made to its own, Cosmo-owning subsidiary, Nevada Property 1. (The structure of deals within the casino industry sometimes veers into surrealism.)

But who will buy, especially as the Cosmo continues to bleed red ink? MGM Resorts International has often been mooted as a potential acquirer, especially Continue reading →

Posted in CityCenter, Cosmopolitan, Harrah's, International, Marketing, MGM Mirage, Penn National, Pinnacle Entertainment, Sheldon Adelson, Steve Wynn | 1 Comment

Meet Geoff Freeman

Posted on April 15, 2014 by David McKee

The American Gaming Association‘s new president demonstrates his dynamic style and outlines his priorities.

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NIMBY in Massachusetts; Hard Rock goes local

Posted on April 15, 2014 by David McKee

Anti-gambling forces in Massachusetts gained an ally yesterday when attorney general candidate Maura Healey (D) came out against casinos and for the repeal of their enabling healey_mauralegislation. This puts her at odds with Attorney General Martha Coakley (D), who holds that to reverse course at this point would be an illegal taking of contractual property. Healey’s primay opponent, Warren Tolman (D) opposes repeal. Arguing against Coakley, Healey wrote, “The opinion stated that it is improper to shut down the licensing process now that several casino operators have applied. But voters made a decision to shut down the greyhound tracks with a ballot question and that was an industry that had been running for years.” She reasons that casino operators should have been prepared to get kicked out at any time.

Singing from the liberal do-gooder hymnal, Healey blogged, “Casinos don’t lay a foundation for diverse economies, they take over.” If her allies lose in court, Healey wants casinos to pay for the best lawyers available, so that they can be policed. She also promises to put teams of investigators on Continue reading →

Posted in Election, Golden Gaming, Hard Rock Hotel, Iowa, Marketing, Massachusetts, Penn National, Politics, Slot routes, Station Casinos, Technology, Warner Gaming | Comments Off on NIMBY in Massachusetts; Hard Rock goes local

Ivey, cheater or genius?

Posted on April 15, 2014 by David McKee

Phil Ivey‘s run-in with the Borgata wasn’t his first instance of collision with a casino that thought it had been cheated. In both instances the casinos would appear to have themselves to blame for getting gulled by Ivey’s charm and bankroll. In the spring of last year, Crockford’s, in London, got taken for 9 million pounds. Among the casino’s displays of weakness was keeping the same cards in play two nights running and rotating some of them 180 degrees when putting them back into the shoe simply because Ivey is “superstitious.”

Gaming-casino-croupierThis second point is significant because it enabled Ivey to track cards that had been improperly cut (“edge sorting,” it’s called), theoretically enabling him to know the cards’ value before they were turned. “This way Ivey and his partner could tell from the patterns on the back what cards would be dealt from the shoe. The two of them never even needed to touch the cards. They merely had to look closely. The rest was as easy as printing money.” Crockfords may claim impropriety but it was they who kept the same deck in play instead of destroying it, per club policy. This display of servility came back to haunt them. As at Borgata, Ivey requested — and got — a Chinese-speaking dealer, who communicated with Ivey’s companion. “But still, this is a well known method of cheating, and Continue reading →

Posted in Boyd Gaming, Dining, International | 1 Comment

Quote of the Day

Posted on April 15, 2014 by David McKee

adelson_t200“It may be ironic that while party politicians will be even more reliant on big donors for such monies, and thus even more beholden to those such as Mr. Adelson, the usefulness of party conventions seems to have gone in the opposite direction.” — Aaron Stanley, on the elimination of federal electoral subsidies.

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Soft landing in Atlantic City; Sweating the slots

Posted on April 14, 2014 by David McKee

BorgataA 4% increase in online play helped soften the landing for Atlantic City this month. With cyber-revenue factored into the equation, casinos were down only 2% on a same-store basis. Slot revenue fell 10% but the odds were in the casinos’ favor as table revenues rose 3% despite 15% less play. Borgata (-1%) functioned as a microcosm for the whole market. Its online revenues rose $500,000 from last month, despite fewer players per day. Need I mention that it was crushing the competition?

Although Caesars Atlantic City was flat with last year, the other three Caesars Entertainment properties suffered declines, with deep ones at Showboat (-17%) and Bally’s (-18%). New business flocked to the Golden Nugget (up 20%), Revel ($15 million, +50% [!]) and Tropicana Atlantic City (+10.5%), along with Resorts Atlantic City (+21%). At $15 million, Revel has lapped Continue reading →

Posted in Atlantic City, Boyd Gaming, Cretins, Harrah's, Mohegan Sun, Ohio, Penn National, Regulation, Revel, Technology, Tilman Fertitta, Tropicana Entertainment, Trump Entertainment Resorts | Comments Off on Soft landing in Atlantic City; Sweating the slots

Big names flock to New York; Reno rebounds

Posted on April 14, 2014 by David McKee

Neil BluhmIt’s starting to get seriously competitive in upstate New York, where Neil Bluhm‘s Rush Street Gaming has been seen canoodling with a Schenectady casino project. Others who have been circling the upstate market with interest include newcomers Churchill Downs and Hard Rock International. All of this betokens a sudden conviction that there’s gold in them thar hills. One of the odder proposals, involves David Flaum‘s E23 project near Albany. Last week, Pinnacle Entertainment was being bruited about as a developer. Now there’s will be a 20,000 OTB parlor. The $845,356 Question is why Flaum would go in with Capital District OTB, which lost that amount in 2012. Why not take some money out back and just burn it?

$2 billion. That’s where Penn National Gaming CEO Tim Wilmott thinks Ohio can get to by 2019 or 2020, after a disappointing, $1.1 billion haul last year. “There’s no question Ohio will be a $2 billion casino state,” sayeth Wilmott, Continue reading →

Posted in Churchill Downs, Economy, Hard Rock International, Harrah's, Macau, Neil Bluhm, New York, Ohio, Penn National, Reno, Sheldon Adelson, Station Casinos, Wall Street | Comments Off on Big names flock to New York; Reno rebounds

Mr. Leven, your tinfoil hat is ready

Posted on April 14, 2014 by David McKee

Leven 2Given the chance to make some friends and influence people in Washington, D.C., instead Las Vegas Sands COO Michael Leven chose to spit in their eye. He made the rather wild claim that the present administration wants legalized Internet gambling “so the Internal Revenue Service can collect taxes to fund a federal government whose spending is out of control,” reported the Las Vegas Review Journal. While we fit Leven for a tinfoil hat, one might note that online play has been so paltry to date that taxes from it wouldn’t begin to cover the foreign aid we pay … oh, let’s say Israel. On the off chance that you care, Leven uttered various and sundry other political positions, which you can read here. As for Leven’s boss, Sheldon Adelson, he might want to look to the money-laundering beam in his eye rather than the mote in U.S.-licensed online casinos’.

Another GOP bigwig, Gov. Scott Walker (R-WI) scored a victory last week. No, not re-election (not yet, anyway). The U.S. Department of the Interior gave him permission to punt the Dairyland Greyhound Park decision from Continue reading →

Posted in Architecture, Internet gambling, Sheldon Adelson, Station Casinos, Taxes, The Strip, Tribal, Wisconsin | Comments Off on Mr. Leven, your tinfoil hat is ready

Kill Phil and other pleasantries

Posted on April 14, 2014 by David McKee

Cards 2That’s what Borgata would like to do to poker pro Phil Ivey. It is suing him after he cleaned them out of nearly $10 million at the baccarat tables. The suit contends that Ivey and a co-conspirator discovered a flaw in cards made by Gemaco and resorted to a cheating tactic known as “edge sorting.” Gemaco may be familiar to you because it’s already being sued by the Golden Nugget Atlantic City for providing packs of unshuffled cards. In Ivey’s case, quirks the printing on the back of the cards made some of them identifiable. (Borgata has been a pretty easy ‘mark’ for cheats lately.) Ivey’s Mandarin-speaking spokesman, Cheng Yin Sun, allegedly gave “special instructions” to the dealer on how to layout the cards, on grounds of “superstition.” Both Gemaco and an anonymous Borgata employee are also listed in the lawsuit.

As The Associated Press reports, “The cards have rows of small white circles designed to look like the tops of cut diamonds, but the Borgata claims some of them were only Continue reading →

Posted in Atlantic City, Boyd Gaming, Genting, Iowa, Penn National, Pennsylvania, Sheldon Adelson, Tilman Fertitta, Tropicana Entertainment, Warner Gaming | Comments Off on Kill Phil and other pleasantries

Progress and caution

Posted on April 11, 2014 by David McKee

IGT-logoInternational Game Technology made history yesterday when it unrolled its Powerbucks interstate, progressive jackpot. Under this technological umbrella, IGT games at 22 Caesars Entertainment and Boyd Gaming properties in Las Vegas can be connected with those at five casinos in Atlantic City. And that’s far from the end: Louisiana, Mississippi and Delaware are all studying the idea, which is to create slot prize pools that rival lottery payouts like Powerball. Luckily for them, winners will only have to pay taxes in the state in which they win. For all the creativity in the casino industry, it’s not often that one comes across a better mousetrap that Continue reading →

Posted in Atlantic City, Boyd Gaming, Economy, Harrah's, IGT, Iowa, New York, Penn National, Pinnacle Entertainment, Racinos, Technology, The Strip, Tourism, TV, Wall Street | 1 Comment

Paint them black; New ideas for Atlantic City

Posted on April 11, 2014 by David McKee

chips“Fortunately for police, the chips floated.” That was the undoing of casino cheat Vuong Q. Truong, who tried to hide the better part of $150,000 worth of forged casino chips at the bottom of a lake. No go. The ongoing Truong saga is back in the newspapers after a Herndon, Virginia couple were charged with cheating at Maryland Live (and possibly at Hollywood Casino at Charles Town Races). According to Cordish Gaming, both Ngan S. Nguyen and Dung N. Vo took $1 Hollywood chips and repainted, so that the white chips would pass as black ones, raising their value to $100. The couple allegedly swapped fake chips for $625 in cash, over a 75-minute period. Considering the (failed) risk they ran, the duo may be wishing they’d tried to cash more chips, on the off change they’d get away with it.

Penn National Gaming‘s overexposure to the St. Louis market is redounding to the detriment of its Alton Belle riverboat. Business has been poor for some time, as in Continue reading →

Posted in Atlantic City, Entertainment, Harrah's, Illinois, International, Marketing, Maryland, Missouri, New York, Penn National, Transportation, West Virginia | 1 Comment

Code of silence; Fan dance in Schenectady

Posted on April 11, 2014 by David McKee

Wynn EverettThere’s no better way of convincing people you’ve got something to hide than acting like you’re hiding something. Meet Anthony Gattineri of FBT Everett Realty, who could deal a fatal blow to Steve Wynn‘s casino plans in Everett. Gattineri refuses to pledge that criminals won’t benefit from his sale of the land on which Wynn Boston would arise. Without that pledge, the Massachusetts Gaming Commission won’t approve the Wynn project. Gattineri has also lawyered up and refuses to testify before the MGC. Way to look like a sleazy operator, dude! Younger WynnGattineri’s omerta behavior is fueling suspicion that convicted felon Charles Lightbody is still one of the underlying landowners and would benefit from the sale — a big no-no with the MGC. (The partners have already been caught backdating documents to conceal Lightbody’s co-ownership.) Lightbody has also been taped saying he had a nearby strip club “locked up tight as a drum.” Gattineri also owes Lightbody $1 million that the latter could roll into an equity position in the land deal. It would be a thousand pities if Wynn’s project — which itself has been deemed free of suspicion — were thwarted because he tried to buy land from scumbags like Lightbody and Gattineri.

Speaking of disclosure, Schenectady Mayor Gary McCarthy‘s fan dance about a potential casino is revealing more than it hides. He says an announcement is imminent, adding, “I McCarthybelieve we’ll be doing a project that is complementary to the development that has happened downtown and in the rest of the community.” That’s got ‘casino’ written all over it. McCarthy wittily brushed aside potential opposition with “If I propose motherhood, apple pie and baseball, there will be pushback.” Whoever applies has but 12 days to get their initial fee paid and, in Schenectady’s case, it looks as though retail developer Galesi Group will be it. In that event, Galesi will have to attend a New York State Gaming Commission conference on April 30, where everybody gets to look daggers at each other while regulators lay out the next step in the process, which is currently moving like greased lightning.

It’s quite possible that the U.S. Treasury Department may ask U.S. casinos not just Continue reading →

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