Quote of the Day

Posted on December 9, 2020 by David McKee

“Before Tony [Hsieh] moved his Zappos headquarters to the former Las Vegas City Hall in Downtown Las Vegas the national image of Downtown was loose slots and cheap shrimp cocktail.”—Downtown Grand CEO Seth Schorr on the impact of Hsieh, part of a moving tribute to the late mogul.

Posted in Downtown, Downtown Grand, Tony Hsieh | 1 Comment

Palazzo closes; iGaming here to stay

Posted on December 9, 2020 by David McKee

There’s no room at the inn at Palazzo. Not permanently. But it’s not a good sign for a Las Vegas Strip whose room rates are bumping along the bottom, even during New Year’s Eve weekend. As Las Vegas Sands said, the decision was taken to “better reflect occupancy patterns,” which have been far from great, Strip-wide: 64% on weekends and only 39% midweek. Sands’ initial plan, back when casinos reopened, had been just to resume hotel operations at The Venetian. That went by the boards in a bit of irrational exuberance. Before long, Palazzo was curtailed to weekends-only status and is now dark altogether, except for its restaurants and bars. However, given recent Covid-19 restrictions (25% occupancy), one wonders how tenable that F&B exception is. Gambling will continue uninterrupted. (This almost goes without saying.) Sands has hinted at a Dec. 23 reopening for Palazzo, although a longer hiatus might make more sense. People don’t exactly flock to Sin City over the Christmas holidays. If Palazzo returns as planned, it will have some newish competition, as The Rio wades back in on Dec. 22, albeit only for weekends.

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Posted in AGA, Atlantic City, Barstool Sports, Boyd Gaming, Caesars Entertainment, Colorado, DraftKings, Economy, FanDuel, Hard Rock International, Health, Iowa, Las Vegas Raiders, Las Vegas Sands, Louisiana, Mohegan Sun, Nevada, New Jersey, New Mexico, Ohio, Oregon, Penn National, Pennsylvania, Politics, Sheldon Adelson, South Dakota, Sports, Sports betting, The Rio, The Strip, Tourism | 1 Comment

End of the honeymoon; Virgin Hotel clings to virginity

Posted on December 8, 2020 by David McKee

Gaming revenue dropped last month in Maryland and precipitously so in Ohio, where the good times had really been rolling. Maryland’s $130.5 million gross represented a 7.5% dip, motivating JP Morgan analyst Joseph Greff to write that “We note the sequential year-over-year deceleration reflects the resurgence of new COVID-19 cases in recent weeks. We expect a similar trend to play out in other regions, which points to a retrenchment relative to 3Q revenues/EBITDA results.” (Two fewer weekend days didn’t help either.) MGM National Harbor was immune to the trend, up 2.5% at $55 million, with high-tax slots off 8% up low-tax table games hopping 18%. MGM’s accountants won’t complain. It held 42.5% of market share, comfortably above Maryland Live‘s 34.5%. The latter plunged 15% (to $45 million) and Horseshoe Baltimore 17% (a meager $15 million). Hollywood Perryville had a good month, up 1.5% to $6 million, while Ocean Downs declined 6% to $5 million and Rocky Gap had a 14% setback, to $4 million.

Over in West Virginia, revenues toppled 28%, with slots and tables falling almost equally. Hollywood Casino at Charles Town Races did only slightly better than the average, tumbling 27% with tables down 39% and slots 26% off the pace. When Maryland catches a cold, West Virginia gets pneumonia.

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Posted in AGA, Boyd Gaming, Caesars Entertainment, Churchill Downs, Cordish Co., Dan Gilbert, Detroit, Economy, Golden Gaming, Hard Rock International, Health, Las Vegas Raiders, Maryland, MGM Resorts International, Ohio, Penn National, Pennsylvania, Sports, Sports betting, Virgin Hotels, Wall Street, West Virginia | 1 Comment

Wall Street crowns DraftKings; Hsieh: Grey Goose vs. cold turkey

Posted on December 7, 2020 by David McKee

Credit Suisse analyst Ben Chaiken is initiating coverage of DraftKings but not getting carried away. He’s put a “neutral” rating on the heavily hyped stock, with a $48 price target that mirrors its recent trading range. “We believe there is a lot to like,” Chaiken writes, pointing to DraftKings’ sheer scale and the propensity of sports bettors to stick with a brand once they’ve tried it. He also cites the company’s “roots as a leader in daily fantasy sports that have resulted in first-mover advantages with branding, a targeted user base, and a scalable technology/regulatory platform.” That said, he is nonplussed by DKNG’s high valuation (7X sales) compared to its peers or to other Internet stocks. He fears that this may not be sustainable and “increasing competition in USSB/iGaming could elongate DKNG’s path to profitability.” Chaiken is somewhat skeptical of the number of states that will actually enact sports betting and Internet gambling, which obviously would be a headwind for DraftKings and its fellows.

“We believe DKNG’s premium multiple and stock performance (+181% since its public listing in April) reflect its position as the largest and most liquid pure-play in the fast-growing USSB/iGaming industry, acting more as a vehicle for investor sentiment/enthusiasm than closely reflecting fundamentals,” Chaiken writes. His cautious forecast of 2025 revenues for sports betting and Internet gaming respectively is $9.2 billion and $4.9 billion, making Chaiken more circumspect than his peers. He predicts that 10 more states will legalize sports betting (bringing the total to 36) and four more will sign on to i-gaming, for a total of nine.

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Posted in Barstool Sports, Caesars Entertainment, California, China, Colorado, Culinary Union, DFS, DraftKings, e-sports, FanDuel, Health, Illinois, Indiana, Internet gambling, Marketing, New Jersey, Pennsylvania, Politics, Prostitution, Tony Hsieh, Tourism, Tribal, Wall Street, William Hill | Comments Off on Wall Street crowns DraftKings; Hsieh: Grey Goose vs. cold turkey

Quote of the Day

Posted on December 7, 2020 by David McKee

“I’m just astounded by the dysfunction, the willingness to just stay the course as hundreds of thousands of people die, and the unwillingness to innovate in literally any way. I’ve realized that when we need to rise up as a country, we have truly no moral capacity to do it. It’s just the most mind-bending, complete ‘Twilight Zone’ experience that makes you ask why the hell we even bother.”—Michael Mina, assistant professor of epidemiology at Harvard University’s T.H. Chan School of Public Health, on public response to Covid-19.

Posted in Current, Health | 1 Comment

The empty city and other sad news

Posted on December 3, 2020 by David McKee

Politico took a trip to Atlantic City and found a “city without a pulse,” its Boardwalk “empty,” its casinos “limping.” One out of every three Atlantic citizens remains without a job, not surprising when casinos can only operate at reduced capacity. That said, one of the many distasteful aspects of the current pandemic is the spectacle of Wall Street boffins rubbing their hands with glee over the improved cash flow that results from casinos getting by on fewer employees and drastically reduced amenities. Big Gaming is not entirely blameless, as its representatives have indicated that this is their ‘new normal.’ As for Atlantic City, “unionized casino employees say they have now been jobless for so long that they’ll have to reapply to their former jobs should their casinos decide to hire them back at all.” A 2,400-turkey Thanksgiving giveaway saw demand far outstrip supply.

Reports Community FoodBank of New Jersey CEO Carlos Rodriguez, “No one’s thriving here.” People who have money are saving it at record levels, not good for an industry that relies on conspicuous outlay of dollars. As for those who don’t have money, there’s scant help coming from the federal government, even if the Senate gets off its duff (a mighty big “if”) and passes a second multi-trillion stimulus package. If you think Covid-19 has been bad for the economy, you ain’t seen nothing yet. As Politico notes, “Atlantic City thrives on the industries the coronavirus hit the hardest—entertainment, tourism, service, hospitality—leaving it particularly vulnerable.” (Mind you, the exact same thing could be said about Las Vegas.) And it’s hitting the people at the bottom of the economic pyramid, those making under $27,000 a year, the hardest.

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Posted in Atlantic City, Dining, Economy, Health, International, Internet gambling, Mohegan Sun, Politics, South Korea, Sports betting, Tourism, TV, Wall Street | 3 Comments

Heartbreaker for sports bettors; What killed Tony Hsieh?

Posted on December 2, 2020 by David McKee

A last-second Carson Wentz Hail Mary pass and an ensuing two-point conversion didn’t enable the Philadelphia Eagles to catch the Seattle Seahawks but it ruined the evening for 91% of bettors, who expected Seattle to cover the 6.5-point spread. Instead it eked out a six-point win, great for Seattle but disastrous for those for whom it’s not whether you win or lose but did you cover the spread? This so-called “backdoor cover” was a bonanza for sports books, although we’ve yet to see a dollar amount for the epochal bad beat. As Sports Illustrated‘s Jimmy Traina put it, “A completely unwatchable game still had millions of people hanging around at the end because of one thing and one thing only: the point spread.”

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Posted in Connecticut, Internet gambling, Sports, Sports betting, Tony Hsieh, TV | 1 Comment

Sports betting accelerates but NFL oddsmakers baffled

Posted on December 1, 2020 by David McKee

If it weren’t for Coronavirus, this year’s top story in gaming would undoubtedly be the rapid spread and runaway popularity of sports betting. Case in point, Colorado‘s $211 million October handle. The continuing climb in wagering is notable in that it occurred post-NBA and with a normal (more or less) sports schedule on the books. Even the tragicomic struggles of the Denver Broncos (who fielded a wide receiver at QB last Sunday) haven’t dimmed bettors’ ardor. They’re taking most of their action, almost predictably, to DraftKings and FanDuel, although some new entrants hope to make up for lost time. The two leaders have 84% of market share at present, a dominance that will be difficult to dent. DraftKings has a 46% market share and $18 million revenue since May. FanDuel has 38% and $15 million. PointsBet is arriving this month, with Barstool Sports close behind.

Since casino gambling is clustered in three small Colorado cities, action is almost exclusively online: 98%. After losing $3.5 million in September, sports books showed $9.5 million in win. As for the handle, $68 million of it was on the NFL, way up from September, with baseball contributing $23 million and the return of college football $16.5 million. “The jump in interest in college football shows how local interest can affect betting, and a bigger jump should be expected after the return of the Buffs,” said analyst Ian St. Clair. As for the NFL fans, they’ll probably keep betting more and more—just not on the Broncos. Meanwhile, Michigan‘s Lege is considering enacting a waiver that would allow mobile sports betting to go live by month’s end. Not missing a trick, DraftKings signed a partnership with the Detroit Pistons yesterday.

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Posted in Barstool Sports, Colorado, DraftKings, FanDuel, Genting, Health, Las Vegas Raiders, Michigan, New York, Sports, Sports betting, Taxes | Comments Off on Sports betting accelerates but NFL oddsmakers baffled

Wynn zapped again; Canada boosts DraftKings

Posted on November 30, 2020 by David McKee

“Most of the time we can’t even be honest with ourselves.”—The Commoner in Akira Kurosawa‘s Rashomon.

If at first they don’t give you a casino in Massachusetts, litigate. And when that doesn’t work, re-litigate. That’s what pouting Suffolk Downs owner Richard Fields is doing. A federal court dismissed his lawsuit against Wynn Resorts, so Fields is trying a different tack, coming at Wynn through state court. Obviously it’s too late for him to get a casino. That ship has sailed. Instead he’s trying to shake down Wynn for $1 billion. Fields’ suit focuses on the regulatory process from which Encore Boston Harbor was baptized, although it’s carefully couched in such a way as not to antagonize Bay State regulators. Fields might need them as friends in the future (he has racino ambitions).

Fields has accused Wynn in the past of racketeering. When that didn’t fly in federal court—a decision he is appealing—he narrowed his plan of attack to three prongs. One is that Wynn acted to conceal the criminal records of three individuals from whom it bought the land on which Encore stands. (Previous owner FBT Everett Realty is also being sued.) Reports the Boston Globe, Fields “claims Wynn and a few top executives violated a state law against unfair and deceptive acts and practices, in large part by withholding information from the Massachusetts Gaming Commission that could have disqualified Wynn from holding a casino license.”

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Posted in Atlantic City, Canada, DraftKings, Economy, Election, Las Vegas Raiders, Massachusetts, MGM Resorts International, Mohegan Sun, Pets, Politics, Regulation, Sexual misconduct, Sheldon Adelson, Sports, Sports betting, Steve Wynn, Texas, Wall Street, Wynn Resorts | Comments Off on Wynn zapped again; Canada boosts DraftKings

Quote of the Day

Posted on November 28, 2020 by David McKee

“Tony’s kindness and generosity touched the lives of everyone around him, and forever brightened the world. Delivering happiness was always his mantra, so instead of mourning his transition, we ask you to join us in celebrating his life.”—official announcement of the death of Tony Hsieh, 46. The Downtown Project mastermind (and casino opponent) died of injuries sustained in a Connecticut house fire.

Posted in Current, Downtown | 3 Comments

Las Vegas: First, the bad news …

Posted on November 27, 2020 by David McKee

It’s no wonder October was a bad month for the Las Vegas Strip and Downtown. Visitation to Sin City fell 49.5% and room revenue tumbled 61%. Caesars Entertainment CEO Tom Reeg could, for the sake of argument, be right that Las Vegas will come back bigger than ever at any time in its history. But in the near term it’s pretty clear that things are going to get worse before they get better. Even the locals-casino bubble has burst. Among the factors hurting the Strip last month was that there were zero conventions (a situation unlikely to change anytime soon), leading to woeful hotel occupancy of 47%. Reducing available-room inventory by 8,600 units didn’t help much, even if it was a move in the right direction. Average room rates declined 24% to $112/night and revenue per available room was a meager $52.

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Posted in Boyd Gaming, Caesars Entertainment, California, Cirque du Soleil, Conventions, Derek Stevens, Donald Trump, Downtown, Economy, Entertainment, Internet gambling, Jim Murren, Las Vegas Raiders, Las Vegas Sands, Movies, Real Estate, Sports, Sports betting, Station Casinos, The Strip, Tourism, Transportation | 1 Comment

Quote of the Day

Posted on November 27, 2020 by David McKee

“The result is that you get courthouses that look like corporate office buildings and atrium-equipped government buildings that resemble casinos or upscale resort hotels. Or real clunkers like the FBI Building in D.C.”—architect and critic Witold Rybczynski on the modernist trends in federal architecture that Donald Trump ordered reversed in favor of a neo-Classical look.

Posted in Architecture, Donald Trump | Comments Off on Quote of the Day

Quote of the Day

Posted on November 24, 2020 by David McKee

“[During World War II], people back home collected rubber and bacon grease for years, gave up countless liberties and luxuries, and no one ever called the war a hoax, even if they never saw a Nazi in their backyard. We’re eight months into COVID. World War II lasted six years and a day. The Great Depression lasted 10 years. The 1918 flu lasted two years and two months. Are we really that soft? That careless? That selfish?”—Dr. Mark Morocco.

Posted in Current, Health, history | 1 Comment

A tale of two Nevadas

Posted on November 24, 2020 by David McKee

October was a tale of two Nevadas, one of which (the north) did quite well whilst the other did not. Gaming revenue statewide was down 19.5%, with the Las Vegas Strip acting as a drag anchor, minus 30% at $375 million. Slots were loose, with revenue down 32% on 25% less coin-in. The house played lucky at baccarat, with win up 3.5% but it was a hollow victory, wagering being 42.5% downward. What was gained at baccarat was lost at other table games, which plummeted 38% on 19.5% less wagering. (Good for the players, bad for the house.) Amidst all this bad news, Gov. Steve Sisolak (D) left the door open to a second casino closure, although he was vague about how far his Covid-mitigation measures might go. “Speculating on whether these enhanced restrictions will impact the tourist casinos is challenging to predict,” said casino-law expert Anthony Cabot.

If Sisolak goes the full monty, a two-week closure would probably be insufficient as far as public health goes. Explained Stephen M. Miller, director of UNLV’s Center for Business and Economic Research, “You probably need more than 14 days to see significant effects, since positive tests, hospitalizations, and deaths follow a dynamic path.” Even if a vaccine debuts next month (a big and complicated “if”), “It is hard to imagine a world in which we don’t see more restrictive operating environments for U.S. retail casinos across the next two quarters,” forecast Eilers & Krejcik Gaming analyst Chris Grove.

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Posted in Atlantic City, Australia, Boulder Strip, Caesars Entertainment, Crown Resorts, Downtown, Economy, Elaine Wynn, Entertainment, Golden Gaming, Health, Lake Tahoe, Las Vegas Raiders, Laughlin, Mesquite, Nevada, North Las Vegas, Palms, Real Estate, Reno, Resorts World LV, Sports, Sports betting, Station Casinos, Technology, The Strip, Wendover, Westgate LV, Wynn Resorts | 4 Comments

Biden, vaccine give tourism hope; Cirque du Soleil in crisis

Posted on November 23, 2020 by David McKee

With as many as three Covid-19 vaccines on the way (Pfizer‘s seems to be the favorite horse in the race) and a new presidency two months away, things are looking up, according to people in the tourism industry. “I honestly feel like this may open up a better dialogue between countries,” University of New Haven hospitality expert Jan Jones told the Boston Globe. “That’s something that is so important to tourism … we had a president who was not seen as welcoming to visitors. I think that’s going to change under the Biden administration.” In the first year of Donald Trump‘s administration, tourism fell 4%, leading to the notorious “Trump Slump.” Major feeder markets slacked off and only Canada provided a bright spot. Between 2017-18, gains made during the Obama administration were reversed and a stagnation in U.S. tourism was certainly reflected in Las Vegas visitation and spending. Given all the rabid xenophobia emanating daily from the White House, who could blame tourists for trepidation? One of our leading sources of visitation, Mexico, was particularly demonized by The Donald.

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Posted in Cirque du Soleil, Donald Trump, Economy, Elaine Wynn, Election, Entertainment, Health, MGM Resorts International, Problem gambling, Regulation, Steve Wynn, Technology, The Strip, Tourism, Wynn Resorts | 3 Comments

New rules, green shoots on the Strip; Mixed messages in Michigan

Posted on November 23, 2020 by David McKee

Casinos in Nevada will take a gut punch tomorrow when new state restrictions go into effect. They’ll have to reduce players on the floor to 25% of capacity, and the same holds true for bars and restaurants. Citing “wildfire” levels of Coronavirus in the Silver State, Gov. Steve Sisolak (D) also rolled back meeting levels from 250 people to 50. We don’t know how live entertainment will be affected but Nothing Good seems to be in order. In addition to restrictions already in place on gaming tables and such, dining parties will be constrained to four apiece. The edict will remain in place for three weeks. “As of Friday, November 20, Nevada logged 129,714 cases, an increase of 1,839 new cases since last Thursday. Cases statewide continue to grow at 1,854 new cases per day over the seven days before November 20. The test positivity rate over the last 14 days since November 20 is 15.8 percent,” reported Susan Stapleton. If that doesn’t alarm you, it should.

This setback comes as a green shoot or two was cropping up on the Las Vegas Strip. Room rates for the week of Dec. 13-19 are off only 3% to $100/night. Midweek rates have fallen only 8% and weekend ones up are up 11%. Mind you, mid-December is a slow time for Vegas but we’ll take such good news as we can get. Las Vegas Sands led the pack, jumping 34% midweek and 67% on weekends. Caesars Entertainment, perhaps due to its glut of inventory, lagged the pack with -4% and -7%, respectively, while MGM Resorts International was flat on weekdays and up 10% on weekends. Wynncore spiraled down -54% midweek and underperformed (-4%) on weekends. Placing a vote of confidence in the Strip, Donny Osmond is returning, next August. Presale begins tomorrow (code: CRDONNY) at 7 a.m. Eastern time. Osmond will be planting his flag at Harrah’s Las Vegas, which could use a bonafide headliner and, as he’s one of the hardest-working men in showbiz, Sin City is fortunate to have him back. Well done, Caesars.

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Posted in Boyd Gaming, Caesars Entertainment, California, Colorado, Cordish Co., Detroit, DraftKings, Entertainment, FanDuel, Golden Nugget, Health, Illinois, Internet gambling, Las Vegas Sands, Macau, MGM Resorts International, Michigan, Nevada, New Mexico, New York, Oregon, Pennsylvania, Sports betting, The Strip, Tribal, Wynn Resorts | 1 Comment

Boxing returns to MGM

Posted on November 23, 2020 by David McKee
Posted in Charity, Current, Health, Sports, Sports betting | Comments Off on Boxing returns to MGM

Vegas recovery a Mirage; Illinois closes … again

Posted on November 21, 2020 by David McKee

More from the Too Much, Too Soon? file: MGM Resorts International, despite its long pause in reopening The Mirage has evidently decided it jumped the gun. Hotel rooms there and at Mandalay Bay will be closed Mondays-Thursdays through December at minimum. Heck, even giddy Caesars Entertainment CEO Tom Reeg is only reopening The Rio on a four-nights-a-week basis. Restaurants and “amenities” (read: gambling) at M’Bay and The Mirage will remain open week ’round, of course. The Delano is unaffected by the changes, as is Shark Reef Aquarium. (Need to de-stress? Watch the sea turtles for a while. Works every time.) Meanwhile, from his sickbed, Gov. Steve Sisolak (D) warned darkly of new restrictions. Faced with runaway infections, Sisolak said, “My administration is exploring all mitigation options available to get this under control, while walking a tightrope to balance public health and economic impacts. The goal is to have the most impact on mitigating the spread and the least impact on our fragile economy.” Obviously “all mitigation options” would have to include re-closing the casinos … but what would that do to “our fragile economy”? Based on the examples of Iceland and New Zealand, the obvious solution would be to discourage tourism to the greatest extent possible—but at what price? What gets infected outside Vegas stays in Vegas, sad to say.

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Posted in Caesars Entertainment, Cretins, Culinary Union, Dining, Economy, Environment, Health, history, Illinois, Las Vegas Sands, MGM Resorts International, Nevada, New Mexico, New York, Sahara, Sam Nazarian, Sheldon Adelson, Tamares Group, Technology, The Rio, The Strip, Tourism, Transportation, Tribal | 1 Comment

Quote of the Day

Posted on November 21, 2020 by David McKee

“[Donald] Trump is like the kid who’s been told he can’t join the basketball game, who grabs the basketball and sticks a knife in it to deflate it. It would be funny if it weren’t so serious.”—former New Jersey Gov. Christine Todd Whitman (R) on you know who.

Posted in Current, Donald Trump, Election | 1 Comment

Hurricanes batter Louisiana revenues

Posted on November 20, 2020 by David McKee

If it weren’t for bad luck and worse luck, Louisiana might have none at all. Not only does Isle Grand Palais on Lake Charles remain closed after being ripped from its moorings by Hurricane Laura, the state was battered by Hurricanes Delta and Zeta. Pelican State casinos grossed $152 million, down 18%. While Baton Rouge revenues were flat, New Orleans really got slammed, tumbling 32%. Even Lake Charles was ‘only’ 20.5% off and it usually bears the brunt of hurricane season (playing an extended engagement this year). To dispense with Red Stick, L’Auberge Baton Rouge was up 7% to $13 million. Casino Rouge was off 3% to $4 million, while customers continue to flee Tom Reeg‘s beloved Belle of Baton Rouge in droves, -39% to $1 million. (Just close the place already, Tom.)

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Posted in Boyd Gaming, Caesars Entertainment, Churchill Downs, GLPI, Golden Nugget, Louisiana, Penn National, Twin River | Comments Off on Hurricanes batter Louisiana revenues