{"id":21914,"date":"2018-06-19T07:48:06","date_gmt":"2018-06-19T15:48:06","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=21914"},"modified":"2018-06-19T07:48:06","modified_gmt":"2018-06-19T15:48:06","slug":"penn-caesars-come-together-big-bet-in-smallest-state","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/penn-caesars-come-together-big-bet-in-smallest-state\/","title":{"rendered":"Penn, Caesars come together; Big bet in smallest state"},"content":{"rendered":"

Penn National Gaming<\/strong> swooped in and bought itself a nice little\u00a0operating contract in Louisiana<\/strong>, the Margaritaville Casino Resort<\/strong>, for $115 million. Considering that the price translates to 5.5X cash flow, \"\"Penn got itself quite a bargain. It’s also a vote of confidence in the Shreveport<\/strong>\/Bossier City<\/strong> market when you consider that Penn will own Boomtown Bossier<\/strong> when its acquisition of Pinnacle Entertainment<\/strong> closes. Margaritaville has grossed $157 million year to date, an 8% increase from early 2017. It’s a curious hybrid of a deal, as the physical assets will be owned by Vici Properties<\/strong>, the REIT of Penn’s archrival Caesars Entertainment<\/strong>, the market leader in the greater Shreveport area. Vici paid $261 million for the riverboat and casino, which it will lease at $23 million a year.<\/p>\n

“The pace of deal activity has picked up meaningfully over the LTM period with nine announced deals totaling ~$6.2 bn of REIT capital outlays. In fact, the $6.2 bn of transactions over the LTM period represents roughly half of the total volume of gaming REIT deals since GLPI\u2019s first acquisition (Casino Queen<\/strong>) in the 4Q13,” writes Deutsche Bank<\/strong> analyst Carlo Santarelli<\/strong>. Indeed, with Vici making a deal that would normally be the province of GLPI<\/strong>, things are getting decidedly incestuous. This may soon be a matter of antitrust concern, although probably not under this administration.<\/p>\n

Speaking of Louisiana, gaming revenues were modestly higher last month, up 1.5% to $222.5 million. This was despite a bad month for Pinnacle, the state’s leading operator. (Caesars made up for it.) Golden Nugget<\/strong> in Lake Charles<\/strong> was gangbusters,\u00a0shooting up 19% to $27 million. That didn’t hurt Delta Downs<\/strong>, up 4.5% to $16 million. However, L’Auberge du Lac<\/strong> slipped 2%, for just under $27 million, while Isle Grand Palais<\/strong> got walloped, down 13% to $8.5 million.<\/p>\n

In New Orleans<\/strong>, vast dominance was exercised by Harrah’s New Orleans<\/strong>, up 7% to $26 million. So much for deleterious effects from \"\"the smoking ban. Coming in a distant second were Boomtown New Orleans<\/strong> (-6.5%) and Treasure Chest<\/strong> (+3.4%), just under $10 million each. Amelia Belle<\/strong> was up 7% to $4 million and Fair Grounds<\/strong> racino up 10% to $3.5 million. Upriver in Baton Rouge<\/strong>,\u00a0master of its domain\u00a0L’Auberge Baton Rouge<\/strong> actually slipped 10% to $13.5 million. Eating its dust were Casino Rouge<\/strong>, down 6% to $5.5 million, and Belle of Baton Rouge<\/strong>, falling 8% to $5 million.<\/p>\n

Which brings us back to Shreveport\/Bossier City, where Horseshoe Bossier<\/strong> rose 7.5% to $16 million, while second-best Margaritaville grossed $14 million, a 5% increase. (One can see its desirability.) Eldorado Shreveport<\/strong> was flat at $10.5 million while Boomtown Bossier<\/strong> slid 8% to $5 million. Sam’s Town<\/strong> bettered it at $6 million, despite a 5.5% slippage and Harrah’s Louisiana Downs<\/strong> was flat at $4 million. Likely-to-move Diamond Jack’s<\/strong> tumbled 9.5% to $3 million. Guess players don’t take to being jilted.<\/p>\n

* Sports betting had better come through in a big way for Rhode Island<\/strong>. The Legislature has baked $23.5 million in tax collections<\/a> from sports books into its next budget. That’ll cover a $6 million lawsuit settlement, free community-college tuition and\u00a0part of a \"\"whopping cut\u00a0in car taxes. The bill passed out of the House at a veto-proof 66-7 and now moves to the state Senate. Sports betting was a last-minute addition, worked out by Gov. Gina Raimondo<\/strong> (D), IGT<\/strong> and casino operator Twin River<\/strong>, which controls both of the small state’s casinos, including a soon-to-open slot house in Tiverton<\/strong>. The generous — for the state — gives Providence<\/strong> 51% of wagers, while IGT sets the lines and manages the sports books.<\/p>\n

Speaker of the House Nicholas Mattiello<\/strong>\u00a0(D) applauded the accord, saying,\u00a0\u201cWe are in sports gaming earlier than other states and we have a better percentage for the taxpayers than any state that\u2019s doing it right now.\u201d In an unrelated development, stadium gaming, already in practice in Pennsylvania<\/strong>, will be legalized in Rhode Island in return for a $4 million fee from Twin River. One thing Raimondo didn’t<\/em> get was a fivefold increase in loco weed dispensaries from three to 15. Call it pot luck.<\/p>\n

Twin River’s Tiverton satellite, right on the state border with Massachusetts<\/strong>, can’t open soon enough for some. Penn National’s Plainridge Park<\/strong>, in the Bay State, saw 4% revenue increase last month, implying an eye-popping $377\/win\/slot\/day. (Remember, $200\/slot\/day is considered a healthy average by the industry.) You can bet your bippy Twin River would like to claw some of that back.<\/p>\n","protected":false},"excerpt":{"rendered":"

Penn National Gaming swooped in and bought itself a nice little\u00a0operating contract in Louisiana, the Margaritaville Casino Resort, for $115 million. Considering that the price translates to 5.5X cash flow, Penn got itself quite a bargain. It’s also a vote … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":6025,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[60,176,199,190,7,58,85,84,112,95,30,33,25,141,74,31,129],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21914"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=21914"}],"version-history":[{"count":1,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21914\/revisions"}],"predecessor-version":[{"id":21915,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21914\/revisions\/21915"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media\/6025"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=21914"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=21914"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=21914"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}