Reality check

Posted on August 18, 2009 by David McKee

It's sackcloth-and-ashes time at the Las Vegas Review-Journal, which ran another "The end is nigh" story about falling gambling revenues. (The Aliante Station Effect appears to have petered out in North Las Vegas.)

Yes, we're all the way down, down, down … to 2004 levels. If we take the Wayback Machine five years into the past, we find the Nevada Gaming Control Board reporting a 6% increase in revenue from June 2003. And June '04 was an "off" month for a year that was distinguished by double-digit growth in casino revenue.

Aliante Station: played out?

That same August, the cost of the MGM Mirage takeover of Mandalay Resort Group inched past the $8 billion mark. "[B]ut Wall Street analysts … said the merger still makes sense for investors and the combined company," wrote the R-J's Rod Smith. Weeks earlier, regulators signed off on the $1.3 billion Boyd Gaming/Coast Casinos merger; Station Casinos, Las Vegas Sands and MGM were all recording record-setting financial performances, and Harrah's Entertainment was girding itself for the conquest of Caesars Entertainment. Heck, the industry was feeling sufficiently bullish to absorb a 0.5% hike in the privilege tax. Read one headline, "State gaming revenue on a roll."

Had the industry lived within its means, today's narrative would be quite different. The Las Vegas Sun helpfully charts the inflation and collapse of the casino bubble, which lasted a good three years, peaking in October '07.

Unfortunately, when what went up eventually had to come down, some companies discovered themselves overexposed and with no margin for error. The likeliest victims, though, are the marginal, standalone properties which might find themselves squeezed out of existence as aggressive discounting by MGM and Harrah's brings quality Strip hotel rooms into the "affordable" realm (Or, as Phil Satre puts it, when the A-level product is priced below the B-level product.)

Valuable perspective is to be had by reading (or watching) this roundtable discussion with three men who dominated much of the gaming industry in the Nineties and early into the new century. Ex-Harrah's CEO Satre has earned the right to be a Monday morning QB. After all, he never did anything so stupid as strapping $30 billion in debt onto his company's back.

Former Station CFO Glenn Christenson seems deeply in denial at many points, though even he concedes, "It wasn’t so long ago that we hated conventions as an industry and now it’s critical to our operations. We’re severely damaged by that loss." But ex-Boyd prexy Don Snyder nails it when he describes "a false sense of security" pervading the industry, adding "I think we all got caught up in that."

2004, meet 2009, where "up" is the new "down."

Posted in Boulder Strip, Boyd Gaming, Current, Downtown, Economy, Harrah's, Marketing, MGM Mirage, Michael Gaughan, North Las Vegas, Station Casinos, Taxes, The Strip, Tourism, Wall Street | Comments Off on Reality check

Greek Isles sold, few care

Posted on August 18, 2009 by David McKee

Vegas' hardest-luck casino changed hands … again. Short of another irrational spike in off-Strip land valuations, Canpartners Realty Holding Co. IV LLC is never going to see its $67 million again. The Greek Isles is in a dead zone, a block too far north (being a block away from Encore doesn't do you any good if you're on the wrong side of the block) and two blocks too far east.

Ah well, kinda serves Canpartners right for lending $56 million against a property that was never worth but a fraction of that amount. And until Canpartners gets a gaming license and captures the casino revenue, instead of leasing out the space as a big-ass slot route, it might as well buy a Motel 6 instead.

Had enough? You'd think that after spending six of the last eight years being used as a doormat by the opposition, congressional Democrats would be saying, "It's payback time." Not yet. If anything finally gets their back up, it may (ironically) be a President whose desire for comity too often translates into giving the store away.

There are still a few crumbs left upon the table for those of us who are uninsured, afflicted with pre-existing conditions or laboring under onerous co-pays. But that'll probably be bartered away, too, and we'll be left at the mercy of people like this s,o.b. M.D. who says it's a "privilege" to be healthy. So I'm guessing he's not down with that Hippocratic Oath stuff, either, huh?

Hard Rock overextended. Having doubled down on its costly purchase of the Hard Rock Hotel & Casino, manager/minority owner Morgans Hotel Group finds itself playing for time with its lenders. Reinventing The Joint proves to have been a good idea; ditto the new convention space — both are helping to stave off catastrophe.

But it was sheer pigheadedness of Morgans to push ahead with not one but two new hotel towers amid declining ADRs and slippage in occupancy. When Boyd Gaming called a timeout on Echelon (partly due to partner Morgans' fecklessness), it should been a cue to "wrap" the megaresort-sized expansion of the Hard Rock, at least for the time being.

Posted in Boyd Gaming, Economy, Encore, Entertainment, Morgans Hotel Group, Politics | Comments Off on Greek Isles sold, few care

Goliath awaits

Posted on August 18, 2009 by David McKee

A reader asks: "Doth thou humble Fasolt not feel intruded upon? Or does he reside at home whilst you work?"

The latter. Fasolt's sheer preponderance, not to mention his total aversion to the litter box, militate against taking him anywhere. However, he loves people and used to "assist" me at Casino Executive Magazine on select occasions. He's also got the good people at Mountain Vista Animal Hospital (one of Vegas' greatest treasures) eating out of his paw. He gets a hero's welcome every time he boards there.

Goliath, meanwhile, has found a foster home, which means he will not be a pleasant distraction at work. The "Colony Capital strikes (out) again" post was written with tiny Goliath asleep on my right knee. In two weeks, he should be ready for adoption, although we'd like to make sure he's going to a good home. At a mere 7-8 weeks, he's far better disciplined than some of my adult cats.

Posted in Animals, Current, Pets | Comments Off on Goliath awaits

Colony Capital strikes (out) again; Big Bleauh

Posted on August 17, 2009 by David McKee

Despite taking a 22% gouge out of expenses, Colony Capital and its Goldman Sachs sidekicks managed to convert a 2Q08 profit to a $10.5 million 2Q09 loss. Revenues were down $30 million (or 40%), half of that from diminished room bookings. Could the service cuts be driving the revenue plunge? It wouldn't be the first time we've seen "death spiral" management be a company's undoing.

It's certainly interesting to see the bracing effect the recession has had on Vegas casino execs. They, who once took convention business for granted and looked upon conventioneers as less desirable than gamblers, have had a salutary wake-up call … hopefully not too late.

Colony also threw in the towel on Resorts Atlantic City, although it left CEO Nicholas Ribis behind to run the place. That means he will serve two Boardwalk masters: The Resorts mortgage holders and Colony, with whom he co-owns the Atlantic City Hilton and which Ribis has also been running (into the ground, some charge). What happens if it's in Resorts' best interest to steal business from the A.C. Hilton?

It's difficult to decide who was more foolish here: Colony, for borrowing 2.5X the value of a casino whose best days were behind it, or the bankers who secured $360 million in loans with a $140 million casino. Let the floggings commence!

Speaking of death spirals, when you can get an Imperial Palace room for $18 (as an acquaintance recently did), who'd stay in Mesquite? That exurb's travails continue drag Randy Black's oligopoly down with them. Scant competition appears to have bred slackness and complacency in the Mesquite and Primm markets. It may be mere coincidence that the competition-rich Laughlin market has suffered to a much lesser degree … but I don't think so.

Defaulted interest payments, renegotiated loan covenants, drawn-out cash reserves … these are some of the unappealing alternatives facing Planet Hollywood. No property's struggle is fun to watch but this one is sadder than most because there's been considerable reinvestment (and some stunning redesign) made to turn the ex-Aladdin into something viable. However, all Robert Earl's horses and all Robert Earl's men have come up a bit short.

Plummeting ADRs have precipitated this crisis and, although losses at Planet Ho have consistently narrowed (and continue to do so), this isn't the first time we've heard that Earl's place was really struggling. And, no matter what Earl does, his casino-hotel has intractable, customer-hostile design flaws that cannot be solved by any means short of implosion.

I've been given reason to believe that whoever ends up owning the physically and fiscally bloated ($4.4 billion, at latest count) Fontainebleau, it won't be Penn National Gaming (at least not unless it's free and clear, and presumably cheap — a tall order). If Steve Wynn has indeed already spurned F'bleau that'd leave Apollo Management, which never saw a bad casino investment it didn't like, and this one's nearly $1.8 billion underwater.

F'bleau would also give Master of the Universe Leon Black a de facto Harrah's Entertainment property on the north Strip, although Harrah's needs to fill thousands more hotel rooms like it needs a gaping hole in the noggin. Considering that it costs Boyd Gaming $3 million a month to keep Echelon on ice, preserving the F'bleau monstrosity until such time as new rooms can be absorbed seems a better use of capital than trying to finish the accursed thing.

Shakeup at Sands. Geez, you don't think executives on the chopping block could have anything to do with Genting Bhd's rival project getting ahead of slow-moving Marina Bay Sands, do you? Naaaaah! After all, the executive situation at Las Vegas Sands has been so very tranquil this past year. Just ask William Weidner … or Bradley Stone or …

Posted in Atlantic City, Boyd Gaming, Colony Capital, Current, Economy, Fontainebleau, Genting, Harrah's, Laughlin, Mesquite, Penn National, Planet Hollywood, Sheldon Adelson, Singapore, Steve Wynn, The Strip | Comments Off on Colony Capital strikes (out) again; Big Bleauh

Blogging and cats …

Posted on August 17, 2009 by David McKee

… do not mix well, as you can see:

Goliath, the one-pound, two-ounce kitten we rescued from the I-15 “on” ramp by Caesars Palace, is climbing all over Yr. Humble Blogger — as shown — and, more to the point, all over my computer keyboard.

Goliath has not, however, so much as paused on Joel Stein‘s controversial Time cover story (“Welcome to Fabulous Less Vegas”), thereby proving Rita Mae Brown‘s adage that a page upon which a cat will not deign to sit is probably not worth reading anyway. Goliath’s reign as LVA kitten-is-residence will be brief; a foster home has been arranged, pending his eventual adoption.

Posted in Animals, Current, Pets | Comments Off on Blogging and cats …

A reader responds

Posted on August 15, 2009 by David McKee

 "I'm conflicted: The Vegas Club casino is at least trying different stuff to drive business: Mechanical bull; 'Fetish pit;' Video blackjack; Internet access; Upgraded dining areas; Lobster catch machine, etc. …

"But: I wasn't interested in the fetish pit — I can't trust my back & heart to the bull — the Internet access costs too much for what you get — I want the snack bar &/or the coffee shop back, since I'm NOT a gourmand — I don't play blackjack anymore since I discovered video poker — and the lobster machine has no place in a casino + it's cruel.

"Far as I'm concerned, they should take care of the hotel. I've stayed there a number of times over the years, and the facility & service have continued to decline, year by year, under Tamares. (I come back sometimes because they comp me free hotel stays and $ cash payments @ check-in.)

"Overall, I think they'd do better to invest their money in routine maintenance + upgrades as needed to the LV Club & Plaza … and start paying attention to the low morale of their employees."

[Bobby Ray Harris, are you listening?]

Posted in Downtown, Tamares Group | Comments Off on A reader responds

Saving money? Buy the Trop!

Posted on August 14, 2009 by David McKee

If you're looking for a bargain on the Strip, what about buying the Tropicana Las Vegas? The Las Vegas Review-Journal found that Onex Corp. got $440 million worth of equity (or a 61% share) for a Filene's Basement price of $137 million. That would make the "street value" of the whole Trop $228 million, or $6.7 million an acre — a fifth of what Wall Street valued it at the peak of the Aztar Corp. feeding frenzy. Columbia Sussex won, Pinnacle Entertainment lost … and Pinnacle wound up being the lucky one, as ColSux toppled under insupportable debt.

The Trop's "paper" value would put it in the Treasure Island class, at $733 million. But you'd need an electron microscope to find the Trop's recent EBITDA, so nobody's going to pay Phil Ruffin-sized dollars for the place now. New owner Onex is a private equity firm that dabbles in real estate and sundry other industries. However, unlike some recent bunglers in the casino industry, Onex had the smarts to hire Alex Yemenidjian to head up its casino efforts, first in Illinois and now on the Strip. Compared to those private equity confreres who bought into the industry at its apogee, Onex's Trop move looks downright brilliant.

Posted in Alex Yemenidjian, Columbia Sussex, Current, Economy, Illinois, MGM Mirage, Phil Ruffin, Pinnacle Entertainment, The Strip | Comments Off on Saving money? Buy the Trop!

Tamares' animal cruelty

Posted on August 14, 2009 by David McKee

Man about town Steve Friess has all the gory details, plus video:

Now that new owners have actually made the ex-Tamares Group dump the Gold Spike actually rather spiffy and friendly, the Vegas Club now takes the wilted palm of being Downtown's most depressing casino. It's a no-frills, charmless grind joint, utterly devoid of atmosphere. Casino play, even on a Friday night, was desultory, as though the customers were so despairing they didn't care where they played.

The much-hyped "fetish" pit is a joke. It's tamer than any Britney Spears video and the costumes look like they were bought at a Halloween store. It's cheap — and not in a good way. The wife-beater-wearing female dealers at the Gold Spike are much, much sexier … some of the hottest in Vegas, if that's your thing.

The sports book, once the pride of the Vegas Club, has been turned into a pretty spacious showroom, but that's about the nicest thing you can say for the place. Downtown needs entrepreneurs but Tamares is content to be a slumlord.

Posted in Animals, Downtown, Marketing, Tamares Group | Comments Off on Tamares' animal cruelty

Saving money? Buy the Trop!

Posted on August 14, 2009 by David McKee

If you're looking for a bargain on the Strip, what about buying the Tropicana Las Vegas? The Las Vegas Review-Journal found that Onex Corp. got $440 million worth of equity (or a 61% share) for a Filene's Basement price of $137 million. That would make the "street value" of the whole Trop $228 million, or $6.7 million an acre — a fifth of what Wall Street valued it at the peak of the Aztar Corp. feeding frenzy. Columbia Sussex won, Pinnacle Entertainment lost … and Pinnacle wound up being the lucky one, as ColSux toppled under insupportable debt.

The Trop's "paper" value would put it in the Treasure Island class, at $733 million. But you'd need an electron microscope to find the Trop's recent EBITDA, so nobody's going to pay Phil Ruffin-sized dollars for the place now. New owner Onex is a private equity firm that dabbles in real estate and sundry other industries. However, unlike some recent bunglers in the casino industry, Onex had the smarts to hire Alex Yemenidjian to head up its casino efforts, first in Illinois and now on the Strip. Compared to those private equity confreres who bought into the industry at its apogee, Onex's Trop move looks downright brilliant.

Posted in Alex Yemenidjian, Columbia Sussex, Current, Economy, Illinois, MGM Mirage, Phil Ruffin, Pinnacle Entertainment, The Strip | Comments Off on Saving money? Buy the Trop!

Kitty rescue at Caesars; Stingy Station

Posted on August 14, 2009 by David McKee

As we were driving to LVA HQ this morning, we spotted a disoriented-looking little cat running through the Flamingo Rd./I-15 interchange, across from Caesars Palace. We were in a quandary about what to do until it turned and started ambling down the I-15 "on" ramp, heading straight for certain death. I ran down the ramp after it (the kitty's a fast little bugger), scooped it up in one hand and …

Well, what to do? I am now the custodian of a small, tuxedo-patterned kitten who may be carrying God knows what infections. It's too docile to be a feral cat but it's definitely going to need a new residence. So if anybody reading this can lend a helping hand to a homeless kitty, contact me at [email protected]. I could just plop the wee bairn out in the LVA parking lot, along with our resident strays, but they're all massive and it would be a very Darwinian situation, I fear.

Cheesparing at Station: The formidable Jean Scott has news of some recent and untoward developments at Station Casinos, as the bankrupt company resorts to new "economy" measures. While the Fertitta clan sinks approximately $90 million into Orange County mansions, they're recouping the cost of their poor business decisions out of their customers' hides.

Random observations: Last night, we celebrated my Better Half's birthday, partly at Cadillac Ranch, which seems to have an identity crisis. Its menu is slightly countrified (in a C&W sense), its walls are covered with photos of Baby Boomer rock stars (think Steven Tyler) and the video feed is heavy on hip-hop. Go figure. The root beer float is very good, though. At 10:30, as though by prearranged signal, an incoming tide of douchebags flooded the joint and we split …

… the classy southern façade of Mandarin Oriental has now been marred by a building wrap, high up on one corner. It's small by building-wrap standards, managing to both spoil the view and look like a timid half-measure …

… speaking of building wraps, Criss F. Angel has long since been evicted from the eastern façade of Luxor. A new wrap was placed on the northeast corner of Luxor's ancillary hotel, but it's also smallish and — due to way the hotel's buttresses jut forward — hard to see if you're driving into Vegas from the south. Then again, if I were MGM Mirage, I'd probably want to downplay with association with the widely ridiculed Mr. Angel, too.

Posted in Animals, Architecture, Cirque du Soleil, CityCenter, Current, Dining, Entertainment, Harrah's, Marketing, MGM Mirage, Pets, Station Casinos, The Strip | Comments Off on Kitty rescue at Caesars; Stingy Station

Comedy Quest

Posted on August 13, 2009 by David McKee

Having made the rounds of a few laugh lounges lately, I can report that L.A. Comedy Club is not to be sneezed at, especially in its new digs at the Four Queens. However, Tickled Pink, at Planet Hollywood, is one of the more remarkable value propositions in town. Hower, Sin City Comedy Show (not reviewed), also at Planet Ho, manages to be both overpriced and mediocre, and the layout of the room is terrible.

Posted in Downtown, Entertainment, Planet Hollywood | Comments Off on Comedy Quest

I was just saying …

Posted on August 12, 2009 by David McKee

… to a colleague that, given Atlantic City‘s dismal July numbers, a plea for governmental assistance had to be just ’round the corner. Well, whaddya know? In at least five instances, Atlantic City’s casinos are run by companies that just reported profitable quarters, while four more just changed hands for pennies on the dollar. Not to mention that Colony C(r)apital, owner of the remaining two, supposedly was willing to put some or all of $244 million into bankrupt Station Casinos.

I don’t mean to sound unsympathetic, but … considering that Garden State citizens are being asked to tighten their belts, forego tax rebates and the like, if the casino industry needs $20 million to market itself then it can damn well pass the hat and raise the cash in-house. Besides, there’s something unseemly about “pull yourself up by your bootstraps” capitalists clamoring for guvmint subsidy, especially in a state filled with people who are in much greater need. (Yes, I know these are interconnected issues but we’re talking casinos that gross hundreds of millions of dollars every month. They’re not exactly paupers.)

The article’s final paragraph (misleadingly) implies that Trump Entertainment‘s three casinos, the Tropicana Atlantic City and the two Colony properties are all in danger of closing. But might Atlantic City be better off with five — or six, if Revel can be finished — strong casinos, whilst the sicklier ones are put out of their misery?

A reader posed that question to me … and now I pass it along to you.

Posted in Atlantic City, Boyd Gaming, Carl Icahn, Colony Capital, Current, Donald Trump, Economy, Harrah's, MGM Mirage, Tropicana Entertainment | Comments Off on I was just saying …

Carl Icahn, comedian?

Posted on August 11, 2009 by David McKee

"As a result of [Tropicana Entertainment's] continued use of the Tropicana marks in interstate commerce, the Tropicana marks have achieved fame and notoriety and are associated in the minds of consumers nationwide with a consistent level of high-quality casino, entertainment and hotel and restaurant services." — from court filings by Tropicana Entertainment, proud owner of the Tropicana Express in Laughlin, proprietor of the Horizon in Lake Tahoe (above) and evicted operator of the Tropicana Atlantic City. Uh, yeah, that "notoriety" part is right on the money. TropEnt is suing the Tropicana Las Vegas to enjoin it from using the "Tropicana" name.

Posted in Atlantic City, Carl Icahn, Columbia Sussex, Lake Tahoe, Laughlin, The Strip, Tropicana Entertainment | Comments Off on Carl Icahn, comedian?

Rivers Casino by the numbers

Posted on August 10, 2009 by David McKee

Now that you can play the slots in Pittsburgh, just what's on tap? J.P. Morgan has published the slot inventory of brand new Rivers Casino and the slot floor (which is 55% reel-spinning) breaks down by denomination as follows:

Pennies: 973

Two-cent: 320

Nickels: 348

Quarters: 673

50-cent: 38

$1: 351

$5: 85

$100: 4

$500: 1 (plus sundry $2, $10, $15 and $25 slots)

Electronic roulette: 26

Electronic blackjack: 70

Three-card poker: 10

Interesting to see how penny slots, despite being a poorer value play, are now dominant over quarter machines and have thoroughly routed nickel slots. Congratulations to Neil Bluhm and his executive team for getting Rivers Casino up and running in what seems like no time at all, especially after initial developer Don Barden had left it stuck in the mud. Thankfully, the only lasting damage will be to Barden's ability to get future casino licenses.

Posted in Don Barden, Neil Bluhm, Pennsylvania, Technology | Comments Off on Rivers Casino by the numbers

Stanley Ho, ailing monarch

Posted on August 10, 2009 by David McKee

Not many of us make headlines by waking up in the morning and saying something. But when the future of over 50% of Macao's casino market hinges on A) your health and B) your plan of succession, and C) your name is Stanley Ho … well, it's a big deal. Macau Daily Times is reporting that the elderly Ho is both conscious and articulate. However, it's also saying that he needs further surgery to extricate blood clots from his brain. My suspicion that the gambling oligarch suffered a stroke (or something very close thereto) and not a simple slip-and-fall — was first reported — is hardly dispelled by this latest news.

For reasons I was in the midst of outlining last Friday, just before the Big Computer Freeze destroyed it all, we're far from out of the woods on this. Also, the gathering of family members around the patriarch's sickbed is — due to various business agendas — somewhere between courtiers hovering around an ailing monarch and vultures circling potential prey.

Alas, all that must go onto the back burner until I deal with some outstanding business that includes reviewing L.A. Comedy Club at the Four Queens and Tickled Pink at Planet Hollywood. We had some extra time before the latter last night to contemplate CityCenter. Whether one likes it or not, it's going to make several nearby properties — I'm looking at you Monte Carlo and especially New York-New York — look very antiquated, bordering on tacky. With a few exceptions, the Wynn-initation themed resorts are proving to have surprisingly short shelf lives.

Posted in Current, Downtown, Entertainment, Macau, MGM Mirage, Stanley Ho | Comments Off on Stanley Ho, ailing monarch

Neverland Station?

Posted on August 7, 2009 by David McKee

So long Viva, hello Michael Jackson?

According to NBC News, parts of Neverland Ranch are going to be dismantled and moved to — you guessed it — Las Vegas. Who owns Neverland Ranch? Colony Capital? Who has amassed enormous tracts of Vegas-area real estate? Station Casinos. And who is the majority owner of Station Casinos? Colony Capital.

NBC reports that New!Neverland would be (re)built "near the Las Vegas Strip." I humbly submit that now we know what "Tropicana Station LLC" is going to be and why it was shielded from the recent bankruptcy filing.

The current home of ramshackle Wild Wild West and proposed future home of $11 billion metaresort Viva, Station's Tropicana Ave. site owns the acreage Colony would need — and no other Station- or Colony-held asset quite fits the NBC-outlined criteria. Also, if you're feeling peckish, there's an Inn 'n Out Burger across the street. (If the Fertitta clan tried to drive that away, not even their newly acquired Orange County mansions would keep them safe from pitchfork-wielding mobs.)

Posted in Colony Capital, Current, Dining, Station Casinos, The Strip | Comments Off on Neverland Station?

New flavor of Tropicana; M is infectious; Penn is persistent

Posted on August 7, 2009 by David McKee

Alex Yemenidjian has busted out a new logo for his Strip casino:

Hey, it’s a start. Still no word on a new evening show for the Tiffany Theater (and somehow I don’t think Dirk Arthur is going to cut it as a long-term proposition). Anything being possible, perhaps trademarking a new logo will circumvent that “Tropicana” lease-back clause that Tropicana Entertainment CEO Scott Butera snuck past Yemenidjian … but the Tropicana Las Vegas had better set aside $2 million just in case.

Success breeds development. With M Resort a smash right of the box, naysayers to the contrary, it’s proving to be the catalyst for at least one more casino development. The shrouded-in-mystery Raymond Shapiro project would sit immediately north of M and would — especially if M’s amenities get fully built — synergize with the additional retail/amusement development that are in M’s plans.

Industry wisdom, validated by experience, maintains that casinos do better when clustered — and the Anthony Marnell III and proposed Shapiro properties might even get Gary Goett‘s long-stalled Olympia Gaming project out of its holding pattern. (It would be on the opposite site of Las Vegas Boulevard from the Shapiro parcel, closer to I-15.)

The loser in all of this is Station Casinos‘ stuck-in-limbo Inspirada casino project. By the time both that and the master-planned community upon which it was predicated are ready to go, Shapiro and Goett could be as firmly entrenched as Marnell. But, in this lending climate, the operative phrase for any casino proposal remains, “Show me the money.”

Penn to locals: “Screw you.” For execs at Penn National Gaming, fortifying themselves against competition from in nearby counties supersedes the good will of their constituency. In Jefferson County, home to Charles Town Races & Slots, voters rejected a request for table games in a 2007 vote that went 56%/44% against Penn.

Undeterred, Penn is going to get back in voters’ grille this November, it appears, by dint of either the Nov. 7 ballot or a special election a month later. According to J.P. Morgan analysts, the Jefferson electorate is pondering zoning restrictions “to slow down the influx of people from the greater Washington, D.C. area and the conversion of farms to subdivisions.” If that’s indeed the temper of the neighborhood, Penn’s persistence in trying to drive more traffic into the area seems perverse … if understandable from a dollars-and-cents standpoint.

Posted in Alex Yemenidjian, Election, Entertainment, Penn National, The Strip, Tropicana Entertainment | Comments Off on New flavor of Tropicana; M is infectious; Penn is persistent

Case Bets: Ohio, Trump, Fahrenkopfian outrage

Posted on August 6, 2009 by David McKee

With racinos a done deal in Ohio, a suddenly frisky Harrah’s Entertainment is shopping around for a Cleveland-area track. If anything, I’m surprised competing companies haven’t beaten Harrah’s to the punch, but it seems to have sucker-punched its rivals. Good on it.

Donald Trump’s fire-sale acquisition of Trump Entertainment Resorts is far from a done deal, according to the Wall Street Journal. Bondholders who stand to have $1.25 billion flushed away in the Trump/Mark Juliano sweetheart transaction may be able to throw in a spanner in the works.

Casinos spread the wealth — or do they? A Journal of Economic Studies report queries the premise, saying casino expansion dilutes local wage bases. However, casino companies — and some academic allies — aren’t taking this lying down. Both Penn National and Cordish Gaming are making vigorous arguments to the contrary, as is one Frank J. Fahrenkopf.

Posted in Atlantic City, Cordish Co., Donald Trump, Harrah's, Labor, Maryland, Ohio, Wall Street | Comments Off on Case Bets: Ohio, Trump, Fahrenkopfian outrage

Adelson bombing in Pennsylvania; RoboPoker returns; Dissent over Wynn

Posted on August 6, 2009 by David McKee

Both the opening of Sands Bethlehem, and recent expansions of Meadows Racetrack & Casino (+29%) and Mohegan Sun at Pocono Downs (+21%) drove an 18.5% increase in slot revenue this July. With $19.6 million in gross revenue, Sands was only good for fifth place, barely behind Mohegan Sun ($19.8 million).

Adelson's new slot parlor was well off the pace set by Philadelphia Park Casino & Racetrack ($30.8 million) and The Meadows ($29.9 million). Harrah's Chester didn't perform too shabbily, either, pulling in $27.3 million from the one-armed bandits. Both it and Philadelphia Park were less than 2% down from their July '08 revenues, putting paid to the theory that Sands Bethlehem would draw — at least in any significant degree — from the Philadelphia area. Only nearby Mt. Airy Resort & Casino is taking a serious hit.

Downtown Reno's nicest casino, the spacious Silver Legacy, is taking a big step downmarket by succumbing to the cheesy allure of RoboPoker. Even that bit of good news for PokerTek wasn't enough to keep Aristocrat Leisure from writing down its share of the company.

Steve Wynn is The Man, at least in Macao, according to the controversial Jim Cramer. I agree.

Why then, is Wynn Resorts COO Marc Schorr cashing out at a time when the stock is arguably undervalued? Maybe he's just one more American who got overextended in the go-go Bush Era.

Posted in Australia, Cannery Casino Resorts, Harrah's, Macau, Pennsylvania, Reno, Sheldon Adelson, Steve Wynn, Technology, Tribal, Wall Street | Comments Off on Adelson bombing in Pennsylvania; RoboPoker returns; Dissent over Wynn

"You can't bring that sword in here!"

Posted on August 6, 2009 by David McKee

Some do-it-yourself ninja got busted sneaking a samurai sword into Casino Rama, in Ontario. As far as exotic weaponry on the casino floor, S&G thinks this takes the prize.

The not-so-great ATM caper. Both Wired.com and the Christian Science Monitor have been carrying stories on sinister ATM-alikes positioned to capture conventioneers' cash at the Riviera. Since the alleged scam occurred during DefCon, a conclave of hackers, you wouldn't be much of a criminal mastermind if you thought such a scheme would go undetected.

Expanding on the story, the CSM reports that the not-ATM was stationed across from the Riv's security office — a brazen move, if true, and that a similar scheme was unmasked at The Rio. However …

Riviera brass say it was a mixture of hoax and misunderstanding. It was their ATM, they say, and they were the ones who took it offline in anticipation of DefCon. Because, gosh, you wouldn't want operational ATMs in your convention area when it's aswarm with conventioneers, would you? People might actually, like, use it.

Finally, some good news: The video speaks for itself …

Posted in Animals, Harrah's, Horseracing, Riviera | Comments Off on "You can't bring that sword in here!"