Up in Louisiana, down in Pennsylvania; Close Las Vegas?

Posted on July 17, 2020 by David McKee

It’s an extraordinary circumstance when a 19.5% drop in gambling revenue is a cause for celebration. But it happened in Louisiana, suggesting a stronger-than-expected comeback from the casino shutdown. Given that there was one fewer weekend day last month, the numbers may be even better than they initially appear. Harrah’s New Orleans and Fair Grounds racino were only open for 18 days, and paid the price, plunging 75% and 49% respectively. The New Orleans market had the worst of it (-47.5%) while the happy surprise was Baton Rouge, off a mere 4.5%. Lake Charles did second best, in terms of recovery, down 7%. Partly due to the Diamond Jacks closure, Shreveport/Bossier City missed by 17%.

Harrah’s New Orleans grossed a mere $5.5 million while Fair Grounds brought home $2 million. Boomtown New Orleans only missed 6% ($9 million), Treasure Chest was 27% down at $7 million. Amelia Belle sank 41% to $2 million. (It was a bad month for Boyd Gaming generally, a good one for Penn National Gaming.) L’Auberge Baton Rouge was flat (a triumph!) at $12 million, Casino Rouge was down 2.5% at $4.5 million while doomed Belle of Baton Rouge plummeted 31.5% to $1.5 million. L’Auberge Lake Charles slipped 6% but still took first place in its market with $24.5 million. Close behind with $24 million was the Golden Nugget, down 7.5%. Isle Grand Palais (due for overhaul) shed 19.5% to $6.5 million while Delta Downs was off 2% to $15 million.

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Posted in Boyd Gaming, Caesars Entertainment, Churchill Downs, Donald Trump, Economy, Eldorado Resorts, FanDuel, Golden Nugget, Health, Internet gambling, Louisiana, Mohegan Sun, Nevada, Penn National, Pennsylvania, Rush Street Gaming, Sports betting, Tribal | Comments Off on Up in Louisiana, down in Pennsylvania; Close Las Vegas?

Colony Crapital strikes out again; Adelson nixes Mets

Posted on July 17, 2020 by David McKee

Bumbling CEO and key White House economic advisor Tom Barrack is doing what he does best … or most … failing miserably. Barrack, who disgraced the Las Vegas Hilton and sundry other casinos, is now in danger of losing 137 over-leveraged hotels, having defaulted on loans and blown through forbearances. The $3.2 billion in loans secured 89 hotels formerly owned by motel mogul Gary Tharaldson (who some will remember as the former owner of the Westward Ho and sister property The Ho, for which he took Gary Loveman to the cleaners). Forty-eight Inland-branded hotels are also at risk. Trustee Wells Fargo is suing Barrack over a defaulted $768 million loan on the Tharaldson properties, which have run an operating deficit of as much as $25 million over the last three months. Colony is being charged with being “unwilling or unable to fund” aforesaid deficit.

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Posted in Baseball, Charity, Colony Capital, Las Vegas Sands, New York, Sheldon Adelson, Wall Street | Comments Off on Colony Crapital strikes out again; Adelson nixes Mets

Quote of the Day

Posted on July 17, 2020 by David McKee

“I will never put off till tomorrow what I can possibly do–the day after.”—Oscar Wilde

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Cosmofusion; MGM Springfield wants new deal

Posted on July 16, 2020 by David McKee

There are some mighty mixed signals coming out of The Cosmopolitan of Las Vegas. The megaresort informed its thousands of employees that no layoffs are planned. However, it wrote the state that “The layoff and furloughs which began on or about March 24, 2020, and April 17, 2020, may continue beyond six months and/or could become permanent.” So which is it? A Cosmo spokeswoman pooh-poohed the governmental memo as “an administrative notice to the state should a business be forced to make staffing adjustments.” Given the present trajectory of business on the Las Vegas Strip, you’d think those adjustments would be made sooner rather than later, when lean times are expected to fatten. What is the Cosmo really saying? Your guess is as good as ours.

Whatever’s happening at the Cosmo pales in comparison to the job losses at regional casinos. Boyd Gaming sacked 903 employees of IP Biloxi alone, while Boomtown Biloxi dumped 149 and Hollywood Bay St. Louis let go another 167. Louisiana casinos are being hit hard, too, with an aggregate of 1,375 being pink-slipped by Margaritaville, Boomtown New Orleans, L’Auberge Baton Rouge and L’Auberge du Lac, as well as at tribal Cypress Bayou Casino. This brings unemployed casino workers in the state to a dismal 3,000.

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Posted in Boyd Gaming, Cosmopolitan, Derek Stevens, Downtown, Economy, Health, Louisiana, Macau, Maine, Massachusetts, Melco Resorts & Entertainment, MGM Resorts International, Mississippi, Pansy Ho, Penn National, Sociedade de Jogos de Macau, Stanley Ho, Tribal, Wall Street | 1 Comment

Caesars gets wrist slapped in Atlantic City

Posted on July 16, 2020 by David McKee

Casino developers with eyes for Atlantic City just got their biggest break in years—or at least since the demise of Trump Taj Mahal. Assuming the Eldorado Resorts takeover of Caesars Entertainment goes through (and there’s no reason to believe otherwise), all Caesars-imposed deed restrictions have to be lifted. As reader Mike Zidik puts it, “Hello Showboat Casino!” Not only does this give Bart Blatstein a clear runway, the Atlantic Club and venerable Claridge Hotel are also back in play. In light of “serious concerns” expressed by the Division of Gaming Enforcement (which opposed the merger), pinchpenny CEO Tom Reeg will have to commit $400 million in capex improvements to Harrah’s Resort, Caesars Atlantic City and Tropicana Atlantic City. These will be done over the next three years and Reeg has already put the money in escrow. He’ll have to spend another $125 million if the Bally’s sale to Twin River Holdings doesn’t go through promptly and, even if it does, reinvest 5% of annual gross gaming revenue in maintenance. Don’t forget he’s also committed a half-billion to property upgrades in Louisiana. (And he thought he was going to save $500 million.)

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Posted in Atlantic City, Caesars Entertainment, Dining, Donald Trump, Eldorado Resorts, Health, International, Louisiana, Macau, MGM Resorts International, Nevada, Penn National, Regulation, Security, Slot routes, The Strip, Twin River | 1 Comment

Slot routes feel Sisolak’s wrath

Posted on July 15, 2020 by David McKee

Even after they were ordered to enforce mask-wearing or else, some casinos continue to flout the rules. Clark County conducted 1,600 inspections and found deficiencies at Silverton, an absence of social distancing at the Aria pool and no effort being made to even try to socially distance patrons at the Mandalay Bay pool. Over at Venelazzo, ice cream parlor Cocolini was discovered operating without a business permit (!), an extraordinary oversight for landlord Las Vegas Sands. A Grand Canal Shoppes outlet of Subway was flouting mask-wearing requirements, as were sundry other restaurants around town. It’s difficult to know what it’s going to take for business like these to get serious about Covid-19, short of people dropping dead in the streets, God forbid.

Slot route operators are not merely sulking at being shut down through July 24 by the state. They’re filing suit. After all, some of them derive 50% of their revenue from bar-top gambling, which is now nixed. (It’s not like people are coming for the food.) Huffed one marketing manager, “We see that casinos are still having the ability to be open and function and we feel we did everything we were asked to do and we’re trying to figure out why we’re being targeted.” To which Gov. Steve Sisolak (D) would reply, “We know that Covid-19 can easily spread when people are congregating for long periods of time, like inside a bar. In states where we have seen significant spikes, such as Arizona, Texas, and Florida, they have all taken actions to roll back bars.” Lax conduct at those casino pools and gyms has also put them in Sisolak’s cross-hairs.

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Posted in Atlantic City, Caesars Entertainment, California, Dining, Eldorado Resorts, Election, Golden Nugget, Indiana, Internet gambling, Las Vegas Sands, MGM Resorts International, Nevada, New Jersey, Ocean Resort, Regulation, Silverton, Slot routes, Sports betting, The Strip, Tribal, Unite-Here | Comments Off on Slot routes feel Sisolak’s wrath

Quote of the Day

Posted on July 15, 2020 by David McKee

“With a lack of a coordinated national plan, rising infection rates and the ‘gone-wild’ crowd emerging from hibernation with cocktails blazing, I don’t see things getting back to normal this year. Even if a vaccine were discovered tomorrow, it would not be ready for the public before October.”—World Game Protection Conference founder Willy Allison, who canceled this fall’s event in Las Vegas out of a sheer abundance of caution.

Posted in Conventions, Health | Comments Off on Quote of the Day

Las Vegas: The first shall be last

Posted on July 15, 2020 by David McKee

Don’t stay up late waiting for business in Las Vegas to return to “normal” levels. Sin City is uniquely vulnerable to downturns in the U.S. economy (think of the Great Recession) and a trailing indicator of gambling’s health. The prime beneficiaries of the reopening of the U.S. casino economy are going to be regional casinos, closely followed by tribal ones, then Atlantic City and finally Las Vegas. At least Atlantic City has an ocean to recommend it. Regional and tribal resorts are in an unexpectedly favorable position. With no live entertainment, much fine dining out of commission and not much to offer but gambling, Las Vegas has no compelling advantage over staying close to home. Good for the industry, which spurred regional diversification in the early 2000s. Not so good for Las Vegas, which relies on offering things you can’t find anywhere else. Not these days.

Nor is it just a matter of tourism. The recent collapse of Global Gaming Expo highlighted how vulnerable the Las Vegas Strip is to the vicissitudes of the convention business. If trade shows and expos don’t firm up in 3Q20 and 4Q20, the year will be a massive write-off, reliant upon weekend business to prop it up. Perhaps the best news Las Vegas can hope for is that the Moderna vaccine for Coronavirus continues to show promise (it has improved life for 45 test subjects to date) because, barring a watershed event in public health, Las Vegas is going to be something of a pariah. Then again, if Jacksonville becomes too fetid to host the Republican national convention, there are plenty of empty exhibit halls going begging in Sin City …

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Posted in Alabama, Aristocrat, Atlantic City, Boulder Strip, Boyd Gaming, China, Conventions, Downtown, Economy, Eldorado Resorts, Florida, G2E, Hard Rock International, Health, Las Vegas Sands, LVCVA, Macau, Melco Resorts & Entertainment, Ohio, Penn National, Technology, The Strip, Transportation, Wall Street, Wynn Resorts | 1 Comment

Encore Boston reopens and other good news

Posted on July 14, 2020 by David McKee

“It put a big smile on my face,” customer Marcia Hamilton said of Encore Boston Harbor‘s reopening last Sunday. We’ll have to take the smile on faith because employees and customers alike are required to wear PPE masks. Still, Encore is back, even in a somewhat limited form. It was preceded last week by Plainridge Park and followed yesterday by MGM Springfield. The Boston Globe reported that customers were actually “excited” to apply hand sanitizer and don their masks. Good! The workforce is greatly diminished, 1,300 employees having been furloughed. Those that haven’t have been set to such tasks as ‘swooping in’ with disinfectant the moment a slot machine is vacated. Others will take your temperature at the door. Like MGM, Wynn Resorts has the advantage of having been through this already in Macao, so it’s well versed in Coronavirus response. Some of the changes are: No roaming with beverages, no handheld menus, no spa and no nightclub. No poker, craps or roulette, either, and don’t touch those cards when you’re playing 21. Still, the news is—on the whole—cheering.

More positive news: Sports betting is a hit in its first month in Colorado, posting $25.5 million in handle. This translated into $946,741 of revenue is one of the best debuts of sports betting in any state, topped only by Indiana‘s $35 million rollout. Colorado doesn’t break out revenue by operator but, no surprise, DraftKings Sportsbook/Golden Gulch Casino and FanDuel Sportsbook/Golden Gates Casino were reported to be the market leaders. One of the hits was—big surprise—table tennis, generating over $6.5 million in handle. Other popular propositions were golf, UFC, Bundesliga football, NASCAR and Korean baseball, for all you night owls. “One of the primary reasons why Colorado fared well in its first month is that the top brands were ready to go from the beginning,” remarked analyst Dustin Gouker. “Having FanDuel and DraftKings, in addition to Bet MGM and BetRivers, accepting bets on the first day of operation is unprecedented. It shows just how much confidence operators have in the future of the Colorado market.” Color us confident, too.

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Posted in Charity, Cretins, Dining, DraftKings, Economy, FanDuel, Health, Las Vegas Raiders, Las Vegas Sands, Massachusetts, MGM Resorts International, Penn National, Real Estate, Security, Sports, Sports betting, The Strip, Tourism, Transportation, Tribal, Wynn Resorts | 3 Comments

Quote of the Day

Posted on July 13, 2020 by David McKee

“One can measure success at multiple levels. There can be success at a very local level. There can be success at a state level. And there can be success at a national level. But in order for the country as a whole to have an effective response, it has to be a unified, coordinated federal response.”—Johns Hopkins University epidemiologist Dr. William Moss on the U.S.’ handling of Coronavirus.

Posted in Current, Health | Comments Off on Quote of the Day

Mixed signals from Vegas

Posted on July 10, 2020 by David McKee

Reading the Las Vegas tea leaves on a daily basis has one oscillating between seeing a faster-than-anticipated or slower-than-expected recovery. Case in point: Penn National Gaming‘s lack of plans to reopen the Tropicana Las Vegas. It’s worth remembering that Penn has $337.5 million of free rent on the Trop, courtesy of owner Gaming & Leisure Properties, so it can afford to be sanguine. Trop employees may not be feeling so laid-back. They’re going to have a lot of company. Casino.org reports that “numerous” Strip casinos are informing the state of plans to institute large-scale, permanent layoffs, hinting (hell, proclaiming) a downsizing of the traditional resort experience.

Penn is one of those winnowing jobs, specifically at M Resort (328 workers). Independent operators like the Sahara and Treasure Island (414 employees) also make the list. Also on the termination list are workers at Trump International. As its namesake said recently, “You put the wrong person in office, you’ll see things that you would not have believed are possible.” True that. Nor are the job slashings confined to Sin City. The Peppermill Resort Casino is among the Reno resorts that are downsizing. Nationwide unemployment may be waning somewhat but Nevada‘s stands [sic] at a staggering 25% and likely to worsen. The Sahara blamed its job jihad on “a number of protective measures” with which it must comply, a foretaste of what will surely become a familiar excuse.

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Posted in Caesars Entertainment, Derek Stevens, Donald Trump, Economy, Entertainment, GLPI, Health, M Resort, Nevada, Penn National, Phil Ruffin, Reno, Sahara, Technology, The Strip | 1 Comment

Canary in the coal mine

Posted on July 9, 2020 by David McKee

In Asian cultures, safety protocols like wearing a face mask are routine—they’ve dealt with viral outbreaks in the past, it’s not unusual,” gaming consultant Andrew Klebanow told Global Gaming News. And though Covid-19 cases spiked at 17,000 in Singapore, Klebanow’s betting on it to recover faster than other, less-prepared jurisdictions. (Skeptics are postponing a full recovery until 2023.) In comparison to the city-state, Nevada “closed for 78 days, but we didn’t get much guidance from the CDC or the state for at least half that time, 45 days.” Heck, Singapore was erecting protective barriers and shutting slot machines and practicing social distancing before it went into casino lockdown. While some aspects of Singapore’s paternalistic society wouldn’t go down so well over here, there’s quite a bit to be learned from its proactive approach to Coronavirus in the casinos.

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Posted in Caesars Entertainment, California, Diversity, Economy, Eldorado Resorts, Health, Nevada, Regulation, Singapore, Sports betting, Tourism, Transportation, William Hill | 2 Comments

Quote of the Day

Posted on July 9, 2020 by David McKee

“Marginalized community members may fill the lower ranks of the hospitality industry, but the glass ceiling for them is set incredibly low. Few will ever say anything in public for fear of retribution, but we have noticed and frequently talk among ourselves about the fact that the upper echelons of the industry are of a very particular variety. Where are the women? The blacks? The Latinos? The Asians? The gays? The youth? Seriously, where the hell is everybody else?!”—Majestic Hospitality Group CEO Christopher Henry on prejudice in the hotel industry.

Posted in Current, Diversity | 1 Comment

This just in …

Posted on July 8, 2020 by David McKee

Global Gaming Expo, the biggest American gaming trade show and one of the three premier such conventions in the world (the others are in London and Macao) is toast. American Gaming Association President Bill Miller just announced the cancellation of this year’s G2E, once set to begin in October 5. That’s a bitter pill to swallow not only for co-sponsor AGA but for Sands Expo Center, where the show is traditionally held. “In light of continued uncertainty around a viable marketplace at a physical G2E show, global travel restrictions, and currently unknown guidance on large public gatherings this fall, we have come to the unfortunate conclusion that we simply cannot hold an in-person G2E this year,” stated Miller. He added, “Health and safety have always been our top priority and the uncertainty created by the ongoing pandemic makes this the prudent decision ahead of critical deadlines for exhibitors planning to participate.”

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Posted in AGA, G2E, Health, Las Vegas Sands | Comments Off on This just in …

Chicago compromise effected

Posted on July 8, 2020 by David McKee

Windy City Mayor Lori Lightfoot (D) may have won a battle but is still losing the war. The Illinois Lege has passed—and Gov. J.B. Pritzker (D) has signed—a ‘relaxation of Chicago‘s 72% casino tax, a burden so onerous it would ensure that any gambling house built would lose money. However, the improvement in the new bill is difficult to discern. Basically, the new law would negatively incentivize casino development by making it more profitable for developers to keep a casino (and its grosses) small. Revenue from slots would hit 75% if revenues exceeded $1 billion, with a baseline of 22.5%. The maximum installed slot base would 4,000 machines. Table game taxes would start at 15% and escalate to 35% if revenues hit $375 million.

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Posted in Boulder Strip, Caesars Entertainment, California, Environment, Greenwood Racing, Health, Illinois, Internet gambling, MGM Resorts International, Michigan, North Las Vegas, Oklahoma, Politics, Sports betting, Station Casinos, Taxes, The Strip, Tribal | Comments Off on Chicago compromise effected

Quote of the Day

Posted on July 8, 2020 by David McKee

“You’re not going to die from this.”—Tilman Fertitta. 130,902 deaths later …

Posted in Economy, Health, Tilman Fertitta | 1 Comment

True grit

Posted on July 7, 2020 by David McKee

Few things test our communal patience like Coronavirus. It’s endless, enervating, aggravating and, yes, scary. Even Yr. Humble Blogger’s nerves are getting a wee bit frazzled, especially after a near-miss here at home. It’s the worst U.S. health catastrophe since the 1918-20 Spanish Flu pandemic and shows few signs of abating. We didn’t think much of Steve Sisolak (D) before he became governor of Nevada but he’s shown true grit in confronting Covid-19. That quality is being taxed by the behavior of what New Jersey Gov. Phil Murphy (D) would call “knuckleheads” (yes, we believe that’s the medical term). True, the casino industry has done a fairly outstanding job of complying with state health protocols, with 111 violations out of thousands upon thousands of inspections. But it’s an outlier.

On July 3, the governor’s office issued a statement that only 49% of business surveilled for mask-wearing were actually in compliance. Bars and restaurants did not better, 50% compliant. (One might call that a half-assed crisis response.) Other businesses, ranging from auto dealerships to tattoo parlors, were at 61% compliance. “Since enforcement of Directive 024 began, the overall business compliance rate is 85 percent in Northern Nevada and 65 percent in Southern Nevada.” What part of ‘mandatory’ do these businesses not understand?

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Posted in Health, Nevada, Regulation, Sheldon Adelson | Comments Off on True grit

Big Bellagio blunder

Posted on July 7, 2020 by David McKee

Given the dearth of major-league sports in the U.S., Nevada sports books have reluctantly turned to South Korean and Chinese baseball for betting fodder. This led to a novice mistake in the wee hours of June 28, when one could be understandably bleary, a blooper that could cost MGM Resorts International as much as $250K. The Bellagio sports book system took bets on games that had already started, a particularly costly mistake because one savvy gambler scored $137,107.38 with a 10-game (!) parlay. That’s a nice return on a $250 wager. Another, eight-game parlay brought home $11,156.60 on a $100 bet. Las Vegas bookies were taking it in stride—and no wonder. The odds are stacked in their favor. Several told the Las Vegas Review-Journal that the winners could get their money in return for agreeing to be permanently 86’d from the casino. The alternative is to grab your ankles and let the house keep the dough.

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Posted in Caesars Entertainment, Economy, Health, Japan, Laughlin, Louisiana, MGM Resorts International, Regulation, Sports betting, Wall Street | 1 Comment

Quote of the Day

Posted on July 7, 2020 by David McKee

“People react to fear, not love. They don’t teach that in Sunday school but it’s true.”—Richard Nixon

Posted in history | 1 Comment

Quote of the Day

Posted on July 6, 2020 by David McKee

“Tis surprising to see how rapidly a panic will sometimes run through a country … Yet panics, in some cases, have their uses; they produce as much good as hurt. Their duration is always short; the mind soon grows through them, and acquires a firmer habit than before. But their peculiar advantage is, that they are the touchstones of sincerity and hypocrisy, and bring things and men to light, which might otherwise have lain forever undiscovered.”—Thomas Paine

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