{"id":26182,"date":"2020-02-24T10:57:40","date_gmt":"2020-02-24T18:57:40","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=26182"},"modified":"2020-02-24T11:09:16","modified_gmt":"2020-02-24T19:09:16","slug":"reeg-savages-caesars-catskills-rescue-plan","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/reeg-savages-caesars-catskills-rescue-plan\/","title":{"rendered":"Reeg savages Caesars; Catskills rescue plan"},"content":{"rendered":"

Having rashly committed $500 million in reinvestments to the Louisiana<\/strong> market (he’ll have to build whole new casinos to spend that much), Eldorado Resorts<\/strong> CEO Tom Reeg<\/strong> has to make those forfeited \"\"savings back somewhere. Potential sales of Caesars Entertainment<\/strong>‘s branded sports-betting operation and Internet gambling have already been reported. Ditto selloffs of the Colosseum<\/strong> and Caesars Forum<\/strong> convention center (Sheldon Adelson<\/strong> will take your call, Mr. Reeg). Now comes news of more showroom sales<\/a>, as well as outsourcing of the company’s entertainment operations. It’s an open question how much of Caesars will be left after Reeg finishes chipping away at it. Incidentally, we don’t have access to a photo of Reeg but imagine Attorney General William Barr<\/strong> having an identical twin brother and you’ll be on the money.<\/p>\n

The idea is to reinvent Caesars as a gaming-centric company, in which case (if you share Reeg’s vision) some of its amenity-driven Las Vegas Strip<\/strong> resorts would become expendable. As it is, everyone assumes<\/em> Planet \"\"Hollywood<\/strong> is toast. The Rio<\/strong> has already been subtracted. Reeg’s axe may not cease falling: Bloomberg<\/em> reports that he planned to savage even more than $500 million in assets before the corporate board rebelled. Lame-duck Caesars CEO Anthony Rodio<\/strong> (right<\/em>) is trying to shave $100 million off the Caesars bottom line before Reeg and his chainsaw get to work. Sayonara, Japan<\/strong>. “Another unit, which licenses the Caesars name to hotel operators, has been gutted, according to people familiar with the business” (Short-sighted, in our opinion.)<\/p>\n

\u201cThey\u2019ve got an internet casino business that is a material business that I think really gets little to no value,\u201d mused Reeg on a conference call. Caesars Forum, meanwhile, hasn’t even opened and already Reeg is said \"\"to be shopping it. Ruthless! And while he’s downsizing, will Reeg be able to scare up the cash for what are described as badly needed capex reinvestment in Caesars’ remaining properties? (To say nothing of the Eldorado ones in Louisiana that underwhelmed regulators.) Rodio’s fate is safe as a “strategic advisor”\u00a0but CFO Eric Hession<\/strong> and President Tom Jenkin<\/strong> are history. Three high-ranking women are also targeted for elimination, as the top 35 remaining executives are expected to be 91% male.<\/p>\n

Expect an infusion of Caranos, with Executive Chairman Gary Carano<\/strong> and COO Anthony Carano<\/strong> moving over to Caesars, along with six other family members. One might speak of Caesars becoming a “Carano mafia” except that it would be taken the wrong way. (Judging by the number of leaks, there are some very<\/em> unhappy campers at Caesars.) Not to be left out of the nepotism craze, Reeg will bring brother William Reeg<\/strong> aboard as a vice president. Ditto brother-in-law Shawn Clancy<\/strong>.\u00a0Liquor may be quicker but incest is best, they say.<\/p>\n

* After leaving Encore Boston Harbor<\/strong>, former president Robert DeSalvio<\/strong> was quickly tapped by Genting Group<\/strong> to reverse the failing fortunes of \"\"Resorts World Catskills<\/strong>. The initial strategy is to leverage the success of Resorts World New York<\/strong> to feed business upstate. DeSalvio told Global Gaming Business<\/em>,\u00a0\u201cI knew the leadership team\u2014the Lim family and Genting were behind the original notes the Mashantucket Pequot<\/strong> tribe needed to open the original Foxwoods<\/strong>, and over the course of my 10 years there, I came to know both KT Lim<\/strong>, the chairman, and Colin Au<\/strong>, one of the senior leaders of the company.\u201d He found locals business in the Catskills to be “solid” but drive-in business a weak link. The challenge is to shake customers’ preference for other area properties (Wind Creek Bethlehem<\/strong>, for one).<\/p>\n

Adds DeSalvio, “when I looked at the northern New Jersey<\/strong> market\u2014at Paramus<\/strong>, Bridgewater<\/strong>, Fairmont<\/strong>, Fern Rock<\/strong>, Passaic<\/strong>, Bergen County<\/strong>, Morris County<\/strong>\u2014our penetration rate was very low, even though we\u2019re the \"\"closest casino, the customers have a high propensity to game, and they have a high net worth.” GGB<\/em>‘s Frank Fantini<\/em> finds merit in DeSalvio’s plan<\/a>.\u00a0\u201cLas Vegas Sands<\/strong> certainly showed they were capable of getting Asian players out of New York City<\/strong>, mainly out of Queens<\/strong>, to go to Sands Bethlehem<\/strong>,\u201d he said. \u201cThere\u2019s a precedent for tapping into New York City for a casino 70, 80 miles away. The combination of having the Catskills and New York City is amazing, if they can complement each other.\u201d<\/p>\n

Meanwhile, Genting is doubling down on its Queens racino, adding retail, restaurants and a hotel, to capitalize on its proximity to JFK International Airport<\/strong>.\u00a0\u201cThe rooms will be reasonably priced compared to New York City. For all these reasons, we think this is a game-changer,” \"\"DeSalvio told GGB<\/em>. In the meantime, Genting faces its heaviest-ever lift with Resorts World Las Vegas<\/strong>, at $4.3 billion the most expensive U.S. casino resort ever built. The recent infusion of three<\/a> Hilton Hotels<\/strong> brands, announced last week, is the best news the project’s had since Genting took it over.<\/p>\n

* There are now two lottery proposals before the Alaska<\/strong> Lege, one from Gov. Mike Dunleavy<\/strong> and the other from state Rep. Steve Thompson<\/strong>. The oil business apparently isn’t what it used to be and the ensuing budgetary crisis has concentrated solons’ minds wonderfully upon gaming as a solution<\/a>. Forty-five states have lotteries and Thompson argues that Alaska should become #46. Dunleavy has particular cause to promote a lottery, as his proposed budget cuts have raised voters’ hackles and spurred a recall effort. ‘Nuff said.<\/p>\n

* Harvey Weinstein<\/strong>. Guilty<\/a>. Hallelujah.<\/p>\n

* Michael Bloomberg<\/strong>‘s digital billboards targeting Donald Trump<\/strong> (Sample: “Donald Trump went broke running a casino”) have made it to the Las Vegas Strip. The former New York City<\/strong> mayor tweeted a photo of one on the fa\u00e7ade of Planet Hollywood … I almost typed “the Aladdin” because it still looks so damned Arabian. Trump supporters, meanwhile, resorted to animal cruelty<\/a> to get their Vegas message out.<\/p>\n

* Congratulations to our boss, Anthony Curtis<\/strong>, on his election<\/a> to the Blackjack Hall of Fame<\/strong>. That’s one candidacy we’re happy to endorse, albeit after the fact.<\/p>\n","protected":false},"excerpt":{"rendered":"

Having rashly committed $500 million in reinvestments to the Louisiana market (he’ll have to build whole new casinos to spend that much), Eldorado Resorts CEO Tom Reeg has to make those forfeited savings back somewhere. Potential sales of Caesars Entertainment‘s … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[13,98,244,274,42,14,199,26,4,166,120,37,171,241,264,84,53,112,248,101,6,279,232,243,280,9],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/26182"}],"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=26182"}],"version-history":[{"count":3,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/26182\/revisions"}],"predecessor-version":[{"id":26187,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/26182\/revisions\/26187"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=26182"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=26182"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=26182"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}