Wisdom from Wall Street

"Any gaming operator that postpones spending and preserves capital in this environment should be rewarded, in our view." — Stifel Nicolaus & Co. analyst Steven Wieczynski, reacting to news that MGM Mirage had put its Atlantic City and north-Strip projects onto the back burner. Boyd Gaming has extended the hiatus of Echelon and Las Vegas Sands is curtailing its Sands Bethlehem project.

I.O.U.S.A. Making a movie on the subject of the national debt seems like exercise in masochism. Making an absorbing and readily comprehensible film on that abstruse subject is a signal achievement. For those of you who object to my pro-Obama leanings, I should point out that — based on the facts and figures put forward by filmmaker Patrick Creadon (he did Wordplay, for you Will Shortz fans), the Democratic economic plan wouldn't do much more than nibble around the edges of the national debt burden.

Posted in Atlantic City, Boyd Gaming, MGM Mirage, Movies, Pennsylvania, Sheldon Adelson, The Strip, Wall Street | Comments Off on Wisdom from Wall Street

Boyd Takes Sanity Pill

After insisting right up to the bitter end, and then some, on going full-tilt with Echelon, now on hiatus for 7-12 months, Boyd Gaming CEO Keith Smith is modulating his tone. According to Reuters, "He emphasized that Boyd remains 'committed to having a meaningful presence on the Las Vegas Strip,' and is now looking at alternatives including opening the project in phases, modifying its scope or entering into other partnerships."

Far be it from me to mention that *cough* certain blogs *cough* have been urging all or most of the above for a while now. Especially the "entering into other partnerships" part. As far as Echelon's retail mall is concerned, the collapse of General Growth Properties renders the question moot — and gives Smith an excuse to put it indefinitely on ice.

This might be a good time to ease out flibbertygibbet Morgans Hotel Group, which has been almost as big a drag on Echelon as GGP — but I won't press the point. Whatever Boyd comes up with may not be a second Borgata, but it will still elevate the company's image in Las Vegas. There never was any discernible point in trying to do a CityCenter and build everything in one great gulp. That was stepping a little out of Boyd's league. Smith's pause for reflection will undoubtedly result in a more prudent and affordable — and soundly capitalized — Echelon 2.0.

Putting the "monitor" in Christian Science Monitor. The respected newspaper is going to a Web-based publication model. I wonder if a certain local publisher still thinks it will literally be two generations before Americans regard the Internet as their primary news source?

Posted in Boyd Gaming, Current, Morgans Hotel Group, The Strip | Comments Off on Boyd Takes Sanity Pill

Reader recommendations

Last week, I solicited recommendations for affordable hotel rooms, on behalf of a reader. For those of you who don't monitor the "Comments" threads, here's what some readers had to offer …

Why not the Main Street Station; it's downtown, clean and comfortable with nice beds including down comforters. Decent food and not bad gambling! Rooms are reasonable.

Hooters, it isn't the most modern, but it's probably the prototype of what people mean when they babble about "boutique" hotels. Not too large, intimate feel, and balconies that still be accessed.

I never stayed there in its heyday, but I think the criticism of the Plaza is a bit unwarranted. Is it top quality, no, but it is a fun place to play, great sportsbook, and you don't have to worry about spilling a drink on the carpet. I really believe some critiques I read online are from people who do not realize that in a town where one room may cost you $199 a night, the hotel with the $35 room for the same night might not be of the same quality.

We also got a must-to-avoid missive about Imperial Palace, known to locals as "Impotent Palace." Vox populi, vox dei.

Seen last weekend at Caesars Palace: "On Friday, a substantial amount of water was leaking from the ceiling in the Caesars Palace Forum Casino. Four large wastebaskets were hastily placed in the middle of the casino floor to catch the water–which made Harrahs premier property look like a low-rent grind house. The problem was resolved by Saturday, but it illustrated what happens when you're almost $25 billion in debt and losing money every day: You opt for what's euphemistically called 'deferred maintenance,' which means you don't spend any money on repairs until the pipes break."

Posted in Boyd Gaming, Downtown, Harrah's, The Strip | Comments Off on Reader recommendations

Just say ‘no’

Fall is in the air here and so is election fever. I’m just back from early voting and a honkin’ big Obama rally is gearing up on the other side of town, so the mind is full of matters electoral.

The responsibility that comes with this bully pulpit includes making election recommendations with restraint. So, with exception of a ballot initiative or three, I’m going to attempt to refrain from stumping for individual candidates. Although I would humbly suggest that you might — might — want to think carefully before voting for any candidate who enjoys the blessing of that noted casino industry expert, Continue reading

Posted in Downtown, Election, Reno, Taxes, The Strip | Comments Off on Just say ‘no’

Case Bets: Sands bankruptcy?; California spite, Ted Binion still dead, etc.

The ‘B’ word. Yup, somebody finally said it. Stifel Nicolaus & Co. analyst Steven Wieczynski blames The Big Sands Sell-off on fears that “Las Vegas Sands is in jeopardy of running out of cash and going bankrupt.” Sands stock closed the week at a dismal $6.32 a share, 96% off its 52-week high.

The Adelson family, meanwhile, plans to turn its pockets inside out, looking for money.

Gary Jacobs is a good guy. The MGM Mirage executive veep is among the donors supporting California‘s Proposition 2, which would ban certain forms of cruelty to farm animals. Which earns him this animal lover’s vote of thanks.

Other Nevadans are really motivated to donate to Proposition 8. Steve Friess has all the details. Having shot Nevada’s economy in the leg with their opposition to gay marriage, some of the same folks may inflict similar economic damage on California. Which is their First Amendment prerogative and amen to that, but I’m not of the misery-loves-company persuasion.

Nevada’s casino resorts have been cut out of on a lucrative market segment, although Harrah’s Rincon has been among the California ones benefiting from Silver State prudishness, which Harrah’s Entertainment has cannily leveraged into some Vegas-honeymoon promotions. If tribal sovereignty doesn’t shield Harrah’s Rincon and other gay-friendly casinos from Prop 8, I guess that Prop 8 donors from economically blighted Nevada can congratulate themselves on having lopped off their nose to spite their face yet again. Anyway, kudos to Harrah’s execs Michael Weaver and Gwen Migita for contributing to the anti-Prop 8 campaign.

This just in: Made-for-cable movie about Lonnie “Ted” Binion stinks. Hey, it’s a Lifetime Channel production. What else would you expect?

Posted in Animals, California, Election, Harrah's, Marketing, MGM Mirage, Politics, Sheldon Adelson, The Strip, Tribal, TV, Wall Street | Comments Off on Case Bets: Sands bankruptcy?; California spite, Ted Binion still dead, etc.

Is Peter Carlino crazy?

Now I know that Penn National is all a-flush with cash these days and CEO Peter Carlino is probably feeling bullish. Still, in a recent visit to Vegas to assess possible casino acquisitions, he's alleged to have acted like he just fell off the turnip truck.

According to Steve Wynn — in the course of scotching a rumor that he might buy up some MGM Mirage property — Carlino made the company an offer for Bellagio. Carlino must think that J. Terrence Lanni is an awfully desperate man. Why else would MGM part with its most powerful revenue driver on the Strip, a casino that is regularly in Majestic Research's top three when it comes to game usage (over-simply, sheer preponderance of players)?

Carlino made news by publicly dissing the Tropicana as a potential buy, saying "There's better stuff" to be had. Agreed. But, unless Wynn either misheard or is making mischief, Carlino seems to have veered far off the other side of the road. There's definitely some low-hanging fruit out there: The Rio, Riviera (plus debt), Cosmopolitan (ditto), maybe even the Sahara. Why he thinks MGM would part with its most valuable asset beggars the imagination.

(Wynn's hypothesis that MGM might peddle its Atlantic City land and perhaps its half-share of Borgata makes far more sense, especially with the question of Pansy Ho's suitability still hanging fire in New Jersey. And Penn has shown interest in two other A.C. sites already.)

MGM spokesman Alan Feldman is cagey, though, keeping alive the prospect that Bellagio might be had (perhaps by someone with the initials K.K.) for the right price. But I've got to believe it would take an offer as exuberant as the one El-Ad Properties made for the New Frontier before MGM Mirage would pawn its crown jewel to a rival operator.

And don't forget Downtown: Carlino is welcome to buy out slothful Tamares Group any time he likes.

Posted in Atlantic City, Downtown, Harrah's, MGM Mirage, Penn National, Riviera, Sahara, Steve Wynn, Tamares Group, The Strip, Tropicana Entertainment | Comments Off on Is Peter Carlino crazy?

Butera to NJCCC: Your people are dopes

Tropicana Entertainment has formally petitioned the New Jersey Casino Control Commission for the return of its former Atlantic City casino. Oh, to be in the room when the arguments are thrashed out!

Short of conducting an exorcism of the spirit of Columbia Sussex CEO William J. Yung III, it's hard to see how the NJCCC will be able to bring itself to do a 180 on this matter. (Especially when TropEnt's publicity releases still flow from Yung's mouthpieces at Beacon Advisors.)

But if TropEnt can convincingly demonstrate both liquidity and independence, it's hard to argue against it. One might feel otherwise had Justice Gary Stein not made such a total clusterfuck of the attempted sale of the Trop. Heaven only knows if even the pallid Cordish Co. bid will still be on the table by the time the New Jersey Supreme Court gets around to adjudicating TropEnt's forcible ejection from the Garden State, which could take several months.

But CEO Scott Butera, whose scattergun public pronouncements are becoming a matter of routine, may have shot himself in (or very near) the foot this time. His petition's assertion that "it is imperative that competent professionals, experienced in casino operations, be brought to bear," perhaps unintentionally implies that Pam Popielarski and the current Trop management team are incompetent and inexperienced. Which, since they were appointed under the auspices of the NJCCC, probably isn't the best way to go about making friends and influencing regulators.

Butera's got a well-respected sidekick in the person of former NJCCC Chairman Bradford Smith. Maybe he ought to let Smith do the talking, at least in situations where a modicum of diplomacy is required.

Posted in Atlantic City, Columbia Sussex, Current, Regulation, Tropicana Entertainment | Comments Off on Butera to NJCCC: Your people are dopes

A reader asks …

… for good hotel-room suggestions, for an upcoming trip — preferably something that's maybe a little underrated and/or off the beaten path. Since you guys (and gals) stay in Vegas hotels more than I do, it seemed best to throw this one open to the collective wisdom of the readership. If you wanted a good value but didn't to descend to the level of the Tropicana or the Plaza (both of which I've heard energetically bad-mouthed by former patrons), where would you hang your hat?

Incidentally, the LVA rating system is now open to all (i.e., no longer a perk for subscribers). So as you surf to restaurant, hotel, nightclub, entertainment pages, etc., feel free to weigh in and praise or damn, or merely damn with faint praise (or praise with faint damns) as the spirit moves you.

Posted in Downtown, The Strip | Comments Off on A reader asks …

Sunday at The Palazzo with Sheldon

OK, so the big fella wasn't actually there, to the best of my knowledge, but let's not allow pedanticism to get in the way of a Stephen Sondheim reference. The Better Half and I partook of a $119/night room special at the Venetian for a quiet weekend getaway.

Maybe not so "quiet." For one thing, the toilet emitted a deafening din every time it was flushed. Other than that, the decade-old hotel rooms are wearing their age lightly. The interface for the TVs is clunky and slow, unless you count the manually operated set in the bathroom. And it would be nice if one could simply draw the blinds by hand. But it was a spacious, comfortably appointed room that would have provided plenty of lebensraum over an extended sojorn. I've wanted to stay in one ever since I saw a prototype back in early '99.

(Hard to believe, but the concept of a minibar in every hotel room was considered a revolutionary-for-Vegas concept back then. Sheldon Adelson, it bears repeating, has to be counted as one of the two or three present-day figures who have done by far the most to move the "casino-based destination resort" concept forward.)

The room offer came with: comps at Lavo that we were able to parlay into five drinks, plus $50 of match play (which went unused; there's only so much you can cram into a day), etc. No "sweating the comps" there. (BTW, I have to take issue with LVA's characterization of the entrées as "Very Expensive," especially when you take into account that they're meant for sharing.)

The Zefferino brunch buffet is, price-wise, only for those in the mood to splurge, but I have no hesitation in saying it's the best I've sampled in Vegas so far. The erstwhile 40/40 Club is now the Sportsbook Bar & Grill. Former owner Jay-Z may be gone but the service there is as shitty as ever. After being pointedly ignored by the (copious) wait staff, we went over to the little coffeehouse off of Dal Toro Ristorante and were much the better off for it.

The al fresco drinking and dining at Lavo were so pleasant (and the service so exceptional) that two hours passed in what seemed like half the time. The Bloody Mary wasn't quite as good as on a previous visit, where you could eat it with a fork, but it rates up there with the ones at Gallagher's and Memphis Championship BBQ. The S.O. opted for a Saggio, which is too fruity for me, but we both enjoyed at least one Uva Bianco — a lightly sweet martini with white grapes in lieu of olives.

Be warned, though: You'll be directly across from the ridiculous "Sirens of T.I." show that is too bad to be either Camp or even mere cheese. The dialogue would embarrass an X-rated film, although nobody goes to "Sirens" for its dramaturgic values.

Cap it off with late-night dining at Grand Luxe Café (the best value for the dollar to be had on-property) and we enjoyed the makings of a near-perfect day … and a crowded one. Maybe the aggressive discounting of room rates was driving Venetian/Palazzo attendance, but the joint was definitely jumping. (Unless you wanted to play Wheel of Fortune; a bank of machines had just been removed from Venetian's floor.) Business wasn't shabby in either casino, but players clearly gravitate to the older gaming floor, judging from the greater density of people on games at the Venetian.

Between the sheer body count and the general high spirits on view, you'd be hard-pressed to know that there's a recession in progress. But be prepared to rack up some serious mileage when you stay there. After traversing the length of the Venetian/Palazzo megalith three or four times (I lost count), the unrelenting monumentality of it does get to be a bit much.

Then again, "a bit much" might be the Sheldon Adelson aesthetic in three little words.

Your father's Plaza.

Tamares gets wild. Those crazy party animals at Tamares Group have really cut loose with the budget this time. They've renovated all of four rooms at the downtown Plaza. Woo-hoo!

All right, these are prototypes for made-over rooms that Tamares promises to deliver once it settles on a design it likes. So far, color me unimpressed. The new-fangled room doesn't look like that much of an upgrade on the old-hat one.

Not only is $8 million-$13 million a far cry from the $100 million Tamares bulls … claimed it was contemplating spending on the Plaza before those El-Ad Properties spoilsports showed up with their Plaza trademark, their big bankroll and their mean old plans to build a Strip megaresort.

It's also well short of what Tamares would need to spend to get to its stated goal of being "just a notch below the Golden Nugget." (Unless it's a massive notch.) Love him or hate him, owner Tilman Fertitta has spared no expense at the Nugget, and it shows. Tamares is clearly not in his league.

Posted in Downtown, MGM Mirage, Sheldon Adelson, Tamares Group, The Strip, Tilman Fertitta | Comments Off on Sunday at The Palazzo with Sheldon

Adelson's megaphone muted

If Sen. John McCain pulls off the Nov. 4 comeback he’s predicting, it won’t be any thanks to Sheldon Adelson, who puts his mouth where his money is. (Hence those queasy-making odes to Chinese totalitarianism: “People seem to be living a good life in China. Look at the incredible progress China has made. How can someone say they’re doing the wrong thing?“)

Politico reports that, stung by the hornet’s nest that is present-day Wall Street, Adelson has “pulled the plug” on one of his pet projects, Freedom’s Watch.* The latter’s “neverending campaign” has downsized from an artillery barrage ($200 million in planned expenditures this election cycle) to the rattle of small-arms fire ($30 million).

Small wonder, then, that Las Vegas Sands spokesman Ron Reese airily informed the Washington Post that “Mr. Adelson does not comment on his political activity.” Except when he does, of course.

I’ve long wondered if Adelson’s high-profile GOP affiliation worked against him in Kentucky, where Sands found the door rudely slammed in its face. Mind you, the object of Gov. Steve Beshear‘s bromance, Columbia Sussex CEO William J. Yung III, has also been a lifetime Republican backer — until he saw how the chips were falling, so to speak, in the Bluegrass State. Whereupon he strewed Beshear’s path with greenbacks.

As politically polluted as Pennsylvania‘s casino-selection process has been (Give Democratic, get a casino!), at least one right call was made: Handed a choice between a Yung-backed Allentown project and Adelson’s Sands Bethelehem, Pennsylvania regulators opted for the GOP-friendly mogul with a track record of impressive projects, not the one who would shortly become a synonym for insolvency.

* — Back when Adelson’s wallet was still open, conservative activists used to bitch extravagantly (but always anonymously) about how many strings he would attach to the use of what was, after all, his money.

Posted in Columbia Sussex, Election, Kentucky, Macau, Pennsylvania, Sheldon Adelson | Comments Off on Adelson's megaphone muted

Smoke-filled room

Maybe all this fussin’ and frettin’ (some of it from yours truly) about casino smoking bans is masking the real issue: Casino expansion in the U.S. has finally hit the wall in the form of one big-ass recession. Five states are contemplating adding casinos this November and in all but one (Maine), it’s expected to pass. If so, it’ll take some brave souls to buck the headwinds that are pushing casino revenues down.

Gambling halls in Colorado just had another crummy month, with Central City down 26%, Black Hawk off 20% and Cripple Creek declining a “mere” 10%. Some of that is undoubtedly smoking-ban-related falloff, but the smoking issue is beclouding one’s ability to see just how much of the decline is a recessionary side effect.

It’s no easier to get a clear picture in Mississippi. There, you can still smoke ’em if you’ve got ’em, but casino revenues are also on the downward slope. The view here is fogged by Hurricane Gustav, which levied a double-digit whammy on the Biloxi-Gulfport market. But Biloxi Mayor A.J. Holloway — who’s been through good times and bad — isn’t going for the easy explanation. He tells the Clarion Ledger, “the real story here is the economy. It’s catching up on us. This is something I kind of anticipated. Las Vegas and Atlantic City have been seeing this for months, so it was just a matter of time before it reached us.” As a consequence, state and local officials are starting to talk in terms of diminished expectations.

As for Louisiana (-23%), it got thwacked twice over, thanks to both Gustav and his bro, Hurricane Ike. Ergo, the entire month’s numbers have to be tossed out as an aberration, even the relatively modest 9% decline in Shreveport-Bossier City. (“Relatively modest” only if your yardstick is the -34% declivity suffered by Lake Charles‘ riverboats.)

Too bad for Pinnacle Entertainment, though: Its L’Auberge du Lac was starting to give Harrah’s New Orleans tough competition for the #1 revenue-earning spot in the Pelican State — only $1 million behind Harrah’s in July.

Two of the four lowest-earning properties in the state were Tropicana Entertainment riverboats. CEO Scott Butera‘s got his work cut out for him. At least Butera’s finally driven a stake through the heart of that 10,000-room grotesquerie that predecessor William J. Yung III proposed to build on the site of the Las Vegas Tropicana. Trop Ent needs to maximize what it’s got, not chase after pipe dreams.

Posted in Colorado, Harrah's, Louisiana, Mississippi, Pinnacle Entertainment, Tropicana Entertainment | Comments Off on Smoke-filled room

Plaza (the other one) & Gold Spike dispatches

According to the grapevine, El-Ad Properties' Plaza megaresort is not only a "go," but Credit Suisse and Goldman Sachs are likely financiers. That is, if El-Ad and partner Nochi Dankner kick in more equity (I'm hearing $150 million), having exuberantly overspent on the old New Frontier site.

If the deal goes through, Goldman Sachs will have its fingers in quite a few Vegas pies. One of its beards … sorry, I meant to say "affiliates," holds 40% of the Las Vegas Hilton and wields veto power over capital-intensive decisions there. Another octopus arm of Goldman owns Carl Icahn's former ACEP properties, including the Stratosphere. So Las Vegas has a pretty big stake in Goldman's continued financial health.

Up in downtown, The Siegel Group continues apace with its makeover of what used to be Las Vegas' dodgiest casino, the Gold Spike. A detailed set of plans is on file, complete with color swatches. I'm hard-pressed to read the document without my magnifying glass, but the exterior will get a complete face lift, there will be cabañas by the pool, and — so I'm told — a new neon sign is in the works. Enjoy it while you can: Word is that Siegel will run the Spike 2.0 for about five years, then demolish it in favor of something new.

Even so, that will have been 1,000% more than do-nothing Tamares Group has accomplished with the remaining casinos and motels it agglomerated from Jackie Gaughan. And since Tamares emerged from the shadows to challenge El-Ad's Plaza plans (touting a phantom $100 million renovation of its own), how much longer can the Nevada Gaming Control Board maintain the fiction that Tamares is merely a "passive landlord" that does not need to be licensed?

Speaking of the inert, what's the matter with Ameristar Casinos these days? Since the death of CEO Craig Neilsen and the sacking of John Boushy, the company hasn't done much except fire a slew of Chicago-area employees. Ameristar has hunkered down, seemingly in hopes that someone will buy it and put the present leadership [sic] out of its misery. Forward movement at Ameristar — even with several growth opportunities in view — appears to be nil.

Posted in Ameristar, Downtown, Tamares Group, The Strip, Wall Street | Comments Off on Plaza (the other one) & Gold Spike dispatches

Smoke-filled room

Maybe all this fussin’ and frettin’ (some of it from yours truly) about casino smoking bans is masking the real issue: Casino expansion in the U.S. has finally hit the wall in the form of one big-ass recession. Five states are contemplating adding casinos this November and in all but one (Maine), it’s expected to pass. If so, it’ll take some brave souls to buck the headwinds that are pushing casino revenues down.

Gambling halls in Colorado just had another crummy month, with Central City down 26%, Black Hawk off 20% and Cripple Creek declining a “mere” 10%. Some of that is undoubtedly smoking-ban-related falloff, but the smoking issue is beclouding one’s ability to see just how much of the decline is a recessionary side effect.

It’s no easier to get a clear picture in Mississippi. There, you can still smoke ’em if you’ve got ’em, but casino revenues are also on the downward slope. The view here is fogged by Hurricane Gustav, which levied a double-digit whammy on the Biloxi-Gulfport market. But Biloxi Mayor A.J. Holloway — who’s been through good times and bad — isn’t going for the easy explanation. He tells the Clarion Ledger, “the real story here is the economy. It’s catching up on us. This is something I kind of anticipated. Las Vegas and Atlantic City have been seeing this for months, so it was just a matter of time before it reached us.” As a consequence, state and local officials are starting to talk in terms of diminished expectations.

As for Louisiana (-23%), it got thwacked twice over, thanks to both Gustav and his bro, Hurricane Ike. Ergo, the entire month’s numbers have to be tossed out as an aberration, even the relatively modest 9% decline in Shreveport-Bossier City. (“Relatively modest” only if your yardstick is the -34% declivity suffered by Lake Charles‘ riverboats.)

Too bad for Pinnacle Entertainment, though: Its L’Auberge du Lac was starting to give Harrah’s New Orleans tough competition for the #1 revenue-earning spot in the Pelican State — only $1 million behind Harrah’s in July.

Two of the four lowest-earning properties in the state were Tropicana Entertainment riverboats. CEO Scott Butera‘s got his work cut out for him. At least Butera’s finally driven a stake through the heart of that 10,000-room grotesquerie that predecessor William J. Yung III proposed to build on the site of the Las Vegas Tropicana. Trop Ent needs to maximize what it’s got, not chase after pipe dreams.

Posted in Colorado, Harrah's, Louisiana, Mississippi, Pinnacle Entertainment, Tropicana Entertainment | Comments Off on Smoke-filled room

Up in smoke

Few issues involving the casino industry cause such a conflict between intellect and emotion as that of second-hand smoke. Personally, I think even manure is less offensive to the nostrils than cigarette smoke — and it has fewer carcinogenic side effects. Exposing one’s employees to a steady barrage of tobacco and nicotine means shooting dice with their health. And if your employees aren’t aware of the risk they’re running, you’d better bring them up to speed.

But … banning smoking on casino floors is practically a suicide vow for a casino. We don’t know just how bad the effect of Illinois‘ smoking ban has been on the state’s casinos, as it’s been coupled with the crash dive of the U.S. economy. However, gambling revenues were down 26% in the Land of Lincoln last month, far more than in any neighboring state.

Atlantic City seemed to have arrived at an acceptable compromise: Ban smoking on all but 1/4 of the casino floor and provide enclosed lounges (in which employees would not have to set foot) for those players who absolutely, positively have to light up. Unfortunately, with the notable — and laudable — exception of Harrah’s Entertainment — compliance was virtually nil, with Colony “Smoke Gets in Your Eyes” Capital being the worst offender. The city council became so miffed it decided to escalate to a 100% ban.

Then the bottom fell out. Caught in the pincers of a recession and swooning casino revenues (plus the threat of mass layoffs), the city fathers decided to lift their ban. However, they waited so long to come to a decision that it can’t be ratified until Oct. 22. The real-world consequence is that, starting Oct. 15, there will be an odd, one-week interregnum [Correction: 12-day] in which Atlantic City casinos will be smoke-free. It will also provide a seven-day laboratory in which to find out what happens to traffic when a destination casino nixes smoking. Too bad the New Jersey Casino Control Commission doesn’t measure gambling win in one-week increments or else we might have some mighty interesting concrete data. Will the smokers really stay home or is it all a lot of huffing and puffing (more huff than puff, perhaps)?

All of which is a rather windy way of saying that these events make an inauspicious backdrop for Continue reading

Posted in Atlantic City, Colorado, Environment, Harrah's, Illinois, Regulation, Sheldon Adelson, The Strip | Comments Off on Up in smoke

… or not

I’ve been informed that Tropicana Entertainment owner William J. Yung III has signed an irrevocable proxy and cannot vote his shares, no matter how many he owns. Nor he can he regain the reins of the company.

Whether that is enough to satisfy the New Jersey Casino Control Commission remains to be seen. From what I hear, the inarguable fact that TropEnt is in Chapter 11 may be its biggest obstacle to regaining a foothold in the Garden State.

If you’re looking for luxury in downtown Las Vegas …

… the El Cortez will soon be running with the “in” crowd. Who’da ever thunk it?

Posted in Atlantic City, Downtown, Tropicana Entertainment | Comments Off on … or not

He's baaaaaaaaaack!

Score one for Columbia Sussex CEO William J. Yung III. The New Jersey Supreme Court will hear his appeal of the New Jersey Casino Control Commission's revocation of his license, even though a lower court booted it, 3-0. ColSux has been superseded by Tropicana Entertainment, but Yung was still calling the shots when the NJCCC kicked him out of the state. If the Supremes rule in ColSux/TropEnt's favor, there's nothing to stop* TropEnt owner Yung from retaking control of the company and rampaging back into the Garden State. What can we expect then? Oh, probably something like "mass layoffs, regulatory violations and unsanitary conditions ranging from bedbug-infested guest rooms to overflowing toilets."

*[Editor's note: Actually not. See next item.]

Posted in Atlantic City, Columbia Sussex, Tropicana Entertainment | Comments Off on He's baaaaaaaaaack!

Quote of the Day

“It really wasn’t about a quarter. It was really a matter of understanding the slot payout tables.” — Boyd Gaming spokesman Rob Stillwell, on the subject of a 25-cent dispute that began at The Orleans and ended in front of the Nevada Gaming Control Board.

Bonus Quote (since we didn't have one yesterday): "The Vegas economy is built on human stupidity and irrational thinking: it'll always be safe." — Las Vegas Review-Journal reader Michael Wertman, sounding a perversely sanguine note on local economic troubles.

Old school. If you relish old-fashioned, fire-breathing populist rhetoric (I certainly do), then check out the stemwinder below by AFL-CIO Sec'y-Treasurer Richard Trumka. And if that's not your thing, maybe you'll enjoy David Schwartz's latest takedown of public-policy absurdities or, as he calls it, "good old-fashioned municipal ineptitude."

Posted in Atlantic City, Boyd Gaming, Current, Labor, Regulation | Comments Off on Quote of the Day

Trop this!

The fourth time’s the charm — at least if you’re Justice Gary Stein, the tortoise-powered conservator of the Atlantic City Tropicana. Having prolonged the timeline for selling the mammoth hotel-casino three times already, he’s asking the state for a fourth extension. He double-pinky swears that, if the New Jersey Casino Control Commission gives him until Nov. 12, he’ll have deal with Cordish Co. signed, sealed and delivered. Honest Injun.

It’s difficult to see that the NJCCC has any choice in this matter. Stein’s playing chicken with them, considering that they have to vote on his request on Oct. 15, one day before his current deadline to get the deal done. The commissioners picked this nincompoop to handle the Trop sale, so responsibility for this latest delay redounds right back to the NJCCC. Besides, if you had Stein’s cushy $650/hour gig, would you be in any hurry to wean yourself off the Garden State’s teat?

Stein’s slumbrous pace is only further aggravating Tropicana Entertainment CEO Scott Butera. He says the NJCCC should give his company a chance, since it’s “essentially” a different entity now. That “essentially” is certain to be a sticking point, as it’s a tacit admission that owner William J. Yung III is still lurking in the shadows. Unless TropEnt creditors wrest every last share of equity from Yung’s purse, it’s impossible to envision a scenario in which TropEnt gets its wish.

When I joked earlier that Butera had gone “off his meds,” I didn’t know the half of it. Now he’s making off-the-wall remarks about “making an offer for an existing [Atlantic City] casino, or trying to build a new one.”

Butera’s remark would not be ridiculous on its face were TropEnt not in Chapter 11 and limping along with an emaciated cash flow, thanks to the loss of its most lucrative property (the A.C. Trop). Oh, and its flagship riverboat, Casino Aztar, is now being run by the State of Indiana. So Butera would have to sing a very sweet siren song to investors to get them to part with the kind of dough his plan requires. And even then, it’s still a Yung-owned entity, so he’s back to Square One with the Jersey regulators.

Let’s put the build-a-new-casino idea aside for a moment, because it looks prohibitively expensive for a company as waterlogged as Butera’s. Let’s say he can scrape together the hundreds of millions it would require to buy somebody else’s casino. (It’s a stretch, but work with me.)

Perhaps he could go for one of the market’s laggards, like Resorts Atlantic City or the Hilton. Both perform better than Trump Marina (market value: $316 million), so perhaps a deal could be swung for a half-billion or less.

Or maybe Harrah’s Entertainment, which is getting hurt in Atlantic City by Harrah’s Chester, in Pennsylvania, would like to lower its oceanside exposure. The Showboat would be the obvious candidate to pursue; it brings in the lowest daily average win of the four Harrah’s properties and it uses a brand that Harrah’s has effectively discontinued. But you’re talking about a casino-hotel that (with a smaller facility) pulls in Trop-sized revenues. So if Butera really thinks the Trop is worth $950 million or more, what would the Showboat fetch?

If Butera is serious about being a buyer in Atlantic City and not just trying to make a nuisance of himself in order to wear down the NJCCC, he’s getting into a bit of a bind. The higher the price he says the Trop ought to merit, the more it’s going to cost him to get back onto the Boardwalk or into the Marina by buying from someone else. Is his strategy crazy or crazily brilliant? It’s sure got me foxed.

Posted in Atlantic City, Columbia Sussex, Harrah's, Regulation, Tropicana Entertainment | Comments Off on Trop this!

Control Board changes its tune

Waaaaaaaaaaay back in 2000, the Aladdin 2.0 was struggling into being, and Jack Sommer and London Clubs International were at each others' throats. Sommer's shallow pockets had forced LCI into taking a much bigger stake in the megaresort than it had ever envisioned. We all know what happened next: The Aladdin tanked massively, took LCI down with it and broke the health of the company's CEO.

Much of this handwriting was on the wall when the Aladdin went through its licensing hearings. Much Sommer/LCI dirty laundry was aired in public, providing ample reason to doubt the project's viability and solvency. Nevada regulators, however, saw no reason not to let the foredoomed project move ahead. It's that old "Too big to fail" thing.

Aliante Station: All the charm of a corporate HQ.

Perhaps they've learned better, though. The solvency of Aliante Station was front and center at its licensing hearing. Even if revenue projections are 66% overestimated, the new locals casino will still break even, we're assured.

On the other hand, what was Control Board member Randall Sayre smoking when he said it was "refreshing" to see a Vegas casino built for less than $1 billion? Only a fool would spend that much on a locals casino (which relies on a drastically different business model than a Strip resort). And Aliante's $662 million price tag is scarcely a badge of frugality.

Sayre might want to ask why Station had to spend so much when Eastside Cannery, a comparable property, was brought in for 38% of that budget. Station has the two poshest locals casinos in the Vegas area — Red Rock Resort and Green Valley Ranch — but its spending levels strongly suggest that Station's cost control isn't terribly stringent.

Posted in Cannery Casino Resorts, Regulation, Station Casinos | Comments Off on Control Board changes its tune

Buddy, can you spare six billion?

Chuck Monster of VegasTripping.com is a man of few words, but he doesn't miss much (and his Dodgers are four wins shy of the World Series). He's run the numbers on Dubai World's purchase of MGM Mirage stock and found that the sovereign fund's $8.15 billion stake had lost $6,012,496,598 of its value by Oct. 3. To illustrate his point, he's whipped up a graph that puts it in terms that are, well, pretty graphic.

Is this going to end up as yet another saga of overseas investors coming to Vegas and getting taken to the cleaners (Swiss Casinos, London Clubs, Tamares Group, El-Ad Properties, etc.)?

What's in a name? A big headache, possibly. Chuck has also been compiling "Trippy" award nominations and Glenn Schaeffer may want to rethink that Fontainebleau moniker. Chuck's readers have written in with at least nine different spellings, not counting the only-too-inevitable "Fountain-blow." Boyd Gaming's in-abeyance Echelon doesn't prove very spelling-friendly, either. Six different spellings were offered, my favorite being "Echolon." Lord knows, Boyd's found the project to be no small pain in the butt.

Posted in Boyd Gaming, Fontainebleau, International, MGM Mirage, Tamares Group, The Strip | Comments Off on Buddy, can you spare six billion?